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Do Investors have to be Careful about Tik Tok Fate?

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This is not a question for the millions of its American users, what had happened to Tik Tok?

This video app is also an investor’s interest as it’s a flashpoint for the tensions between China and the United States. Between the two biggest world economies the geopolitical conflict is there, now the destiny of TikTok will be sending a signal to the businesses, what will be the consequences of a world which is less globalized. 

As per the sources, even after days when President Donald Trump had said that he would ban TikTok operations in the United States, still, Microsoft (MSFT) was discussing its purchase. 

Satya Nadella, CEO of Microsoft, had said that they would have a talk with Trump regarding buying it from ByteDance, which is a Chinese startup. Policymakers of the US are expressing their concerns that it could be a risk on national security. 

Microsoft wants to acquire TikTok with a complete review of security and giving full benefits economically to the United States, which also includes the United States Treasury. They also said that they would talk to ByteDance within few weeks. 

TikTok may avert ban, which is being threatened to be put by Trump on late Friday, where he said that the use of his executive order or an emergency economic power could be used for blocking the app operation in the United States. 

TikTok will be owned and operated by Microsoft in the US, Australia, New Zealand, and Canada. After this, the share of the company in early trading rose to 4%.

 There is no certainty of the app’s future, as Trump’s position is still not set. At the same time, there are reports that ByteDance is planning to spin off TikTok then to sell it as they are planning for moving headquarters to London instead of Beijing. 

Mike Pompeo, US Secretary of State, has said to Trump that they will be taking action in a few days for the Chinese apps. So, it could be significant to another tech China’s app like WeChat of Tencent’s. 

Global companies around the world need to navigate because of the relationship between Beijing and Washington deteriorates. 

CEO of global bank HSBC (HBCYF), Noel Quinn, said that the tension prevailing had created a difficult situation for HSBC.

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