In a recent segment on CNBC’s ‘Fast Money’, Gene Munster, Managing Partner at Deepwater Asset Management, discussed the implications of a U.S. court upholding a ban on TikTok. The conversation centered around potential Chinese retaliation against American companies if such a ban were to proceed.
Munster highlighted the geopolitical chess match between the U.S. and China, particularly in light of the Trump administration’s relationship with tech giants like Meta (META), which could see some upside if TikTok were banned. However, he warned of two possible outcomes if TikTok faced a ban: China could either capitulate, using the threat of a ban as leverage to negotiate better terms or simply take a financial settlement and exit the U.S. market, or they could choose to retaliate.
If China opts for retaliation, Munster pointed out that Tesla (TSLA) and Apple (AAPL) would be prime targets. He explained that China has a history of using “red tape” to exert pressure, which could involve manipulating work hours, energy usage at manufacturing facilities like Foxconn, or even influencing public perception through state-controlled platforms like Weibo. For Tesla, this could mean disruptions in logistics, potentially affecting how vehicles are shipped to Europe. For Apple, similar tactics could slow down production and lead times, subtly impacting stock prices and investor confidence without overt, headline-making actions.
When asked about the resilience of Apple against such pressures, Munster expressed concern. Despite Apple’s stock being at an all-time high, he noted that roughly 45% of Apple’s revenue is tied to manufacturing in China. This dependency suggests that even if the impact isn’t immediate or drastic, the subtle slowdown in production and supply chain could affect future quarters, giving investors time to observe these changes before they reflect in financial reports.
Munster’s insights underscore a complex scenario where international trade and tech policy intersect, potentially affecting major U.S. corporations in ways that are more covert than overt, influencing not just their operations but also investor sentiment in the broader market.
Price Action: Tesla closed Friday’s trading session at $389.22, marking an impressive 5.34% gain for the day. This surge was followed by an additional 1.40% increase in after-hours trading, bringing the stock price to $394.67. Meanwhile, Apple closed Friday’s session slightly lower at $242.84, a 0.08% decrease, and then fell by 0.20% to $242.36 in after-hours trading.
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