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Snap shares jump 9% on TikTok’s potential ban in the U.S.

Published 03/06/2023, 05:16 PM
Updated 03/06/2023, 05:23 PM
© Reuters.  Snap shares jump 9% on TikTok’s potential ban in the U.S.

By Davit Kirakosyan

Snap (NYSE:SNAP) shares jumped more than 9% on Monday, rising above the 200-day moving average for the first time since 2021, after U.S. Senate Intelligence Committee Chairman Mark Warner told Fox News that he plans to introduce a bill this week to ban Chinese technology, including ByteDance Ltd's social media service.

Snap's shares have been battered by intense competition in short-form video platforms and a bleak digital ad market. The company has underperformed its peers, with shares dropping 75% since the end of 2021, compared to 45% for Meta Platforms Inc (NASDAQ:META) and 27% for Pinterest (NYSE:PINS).

According to Bloomberg Intelligence, if U.S. lawmakers proceed with a TikTok ban, YouTube (NASDAQ:GOOGL) could gain the most user market share among social media peers due to its content-recommendation algorithm and revenue-sharing model. While Snap, Meta Reels, and Roblox may also experience increased engagement, YouTube may attract more creators.

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