The Trump administration's move to ban US residents from doing business with Tencent Holdings' WeChat app rippled through Chinese markets, erasing US$30 billion from the Internet giant's market value and sending the yuan to its biggest slump in two weeks.with Tencent Holdings' WeChat app rippled through Chinese markets, erasing US$30 billion from the Internet giant's market value and sending the yuan to its biggest slump in two weeks.
The US president's executive order fuelled concern that the deteriorating US-China relationship will weigh on companies, economies and markets. Confusion over the scope of the order led to volatile trading on Friday, with Tencent plunging more than 10 per cent before paring its loss to 4.3 per cent at 1.53pm in Hong Kong. A US official later clarified the ban will only cover WeChat.
The vaguely worded order raised concern that a ban could hammer not just the use of WeChat and WeChat Pay in the US but extend to business relationships with some of America's largest corporations. The world's biggest games publisher by revenue in 2019, according to Newzoo data, Tencent collaborates with US industry leaders like Activision Blizzard and Electronics Arts.
Mr Trump's order on WeChat came after a similar injunction against ByteDance's TikTok, the viral video service the White House accuses of jeopardising national security. But Tencent is at the heart of communications between people and businesses within China and abroad, as the operator of WeChat.
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