The Wall Street Journal has reported that Apple’s acquisition of a minority stake in Chinese tech giant Tencent has triggered a surge in global stock market volatility.
The move could trigger a dramatic correction in the market’s performance and, if stocks start dropping, could send the U.S. dollar soaring and force it to weaken.
Apple, which is based in Cupertino, California, has already purchased stakes in several Chinese tech companies and is currently exploring buying a majority stake in a Hong Kong-based company.
According to the report, the $1 billion purchase would allow Apple to buy stakes in more than 40 technology companies, including Tencent, China’s biggest social network and mobile service, and Tencent’s mobile payments company.
“It would have an impact on the global market and we’ll be watching it very closely,” Michael Oreskes, an analyst at Oppenheimer & Co. in New York, told the Wall Street journal.
“It could send shares of stocks lower, it would have a huge impact on global stock markets, but also for the U,S.
market, because the dollar could go up a lot, which would hurt the dollar.”
Apple has been one of the biggest tech investors in the world, and has been trying to gain a foothold in China’s booming mobile-payment industry.
Apple’s chief executive, Tim Cook, has been aggressively expanding Apple’s business, and bought stakes in some of the world’s biggest companies in recent years.
It is not known how much Apple paid for Tencent.