Naspers tanks after Trump targets WeChat - TechCentral

Naspers tanks after Trump targets WeChat

WeChat is owned by China’s Tencent, in which Naspers has a 31% stake

South Africa’s main stock index halted a four-day rally, falling 1.3% by 9.15am in Johannesburg, as index heavyweight Naspers dropped 4.4% after US President Donald Trump signed a pair of executive orders prohibiting US residents from doing business with the Chinese-owned TikTok and WeChat apps.

The ban starts in 45 days, with Trump citing the national security risk of leaving Americans’ personal data exposed.

Naspers holds a 31% stake in WeChat’s owner, Tencent, which plunged as much as 10% in Hong Kong. Naspers subsidiary Prosus, which holds the company’s stake in Tencent, retreated 5.4%.

“This directly impacts Naspers and Prosus via Tencent and similarly will dampen sentiment on tech,” says Casparus Treurnicht, a fund manager at Gryphon Asset Management in Cape Town. As Naspers and Prosus make up more than 20% of the benchmark index, “one should be worried”.

The fresh US-China turmoil threatens to derail this week’s rally in global shares. Better-than-forecast earnings and optimism on a coronavirus vaccine had helped lift a gauge of world equities to little changed for the year. Friday weakness trims the FTSE/JSE Africa all share’s weekly gains to 2.2%, but it’s still set for a second consecutive week of advances.  — Reported by Adelaide Changole, (c) 2020 Bloomberg LP

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