The U.S. House of Representatives is taking another step to cut out China’s influence in the country. It will fast-track a vote next week that will push ByteDance six months to divest TikTok. If the company, based in China, does not comply, it will face a U.S. ban.
Reuters reported that the Energy and Commerce Committee voted 50-0 on this action.
The vote infers that the U.S. will continue to scrutinize Chinese technology firms operating in the U.S. PDD, formerly known as Pinduoduo, relocated its headquarters outside of China. However, its Temu app is a fast-growing e-commerce service. Temu advertises heavily on Google’s search site and Meta platforms (META). The ad revenue on Instagram and Facebook enriches the parent company. Alibaba (BABA) also spent heavily advertising on Facebook, Instagram and Google.
Last month, China posted a trade surplus. It increased to $125.16 billion, up from $103.8 billion. The latest moves may slow China’s trading volumes with the U.S.
Inflation Watch
Now that stock markets closed at fresh new highs on Thursdays, investors may let their guard down. Fed Chair Jerome Powell said this week that the Fed was not in a position yet to cut interest rates. Still, it gave the market hope by increasing the likelihood of a cut at some point this year.
Beware of next Tuesday’s inflation report. The U.S. Consumer Price Index may indicate inflation is far higher than the Fed’s 2% target. This will increase the attractiveness of gold as a safe-haven holding. Gold closed at a record high this week.
