Snap jumps as US TikTok ban plan gains momentum

3 years ago 1

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Snap Inc. shares soared on Monday as lawmaker efforts to ban TikTok appeared to be gaining traction in the US.

The Snapchat owner rose 9.5% after US Senate Intelligence Committee Chairman Mark Warner told Fox News on Sunday that he plans to introduce a bill this week to allow the US to ban Chinese technology, including the social media service owned by ByteDance Ltd.

Monday’s gain pushed Snap shares above the 200-day moving average for the first time since 2021, according to data compiled by Bloomberg.

Pinterest Inc., which competes with Snap for digital advertisements, gained 1.1% while Facebook owner Meta Platforms Inc. fell 0.2%.

Snap shares have been battered amid rising competition in short-form video platforms and a gloomy market for digital ad spending.

While Wall Street analysts have been speculating that rivals such as Alphabet Inc.’s YouTube or Meta Platforms could benefit more from a potential TikTok ban, Snap has underperformed peers.

Since the end of 2021, Snap is down 75% compared with a drop of 45% for Meta Platforms and 27% for Pinterest.