The Dow Jones Industrial Average (^DJI 0.72%) was putting the other major stock indexes to shame Monday afternoon, up about 1% by 1:45 p.m. EDT. There's a lot going on: A new stimulus bill continues to be held up in Congress, executive orders from President Donald Trump escalated tensions with China, and COVID-19 daily cases remain elevated in the U.S. but are trending lower.

Apple (AAPL -2.28%) stock contributed to the Dow's gain on Monday thanks to an analyst price target bump, and despite a dire estimate from a separate analyst for how bad things could get for the company if the executive order targeting China's WeChat is taken to an extreme. Meanwhile, Microsoft (MSFT -0.27%) stock headed lower as its deal for Chinese social media app TikTok looks increasingly unlikely.

Shipping containers painted with U.S. and Chinese flags.

Image source: Getty Images.

WeChat ban could hurt Apple

On Aug. 6, Trump issued an executive order that will effectively ban WeChat, owned by Chinese company Tencent, in the United States in 45 days. While the exact details won't be determined until the 45-day period lapses, the worst-case scenario is bad news for Apple.

Analyst Ming-Chi Kuo estimates Apple's annual global iPhone shipments could plunge by as much as 30% if the company is forced to remove the WeChat app from its App Stores in all countries. If the executive order requires Apple to remove the app only in the United States, Kuo predicts a modest 3% to 6% decline in iPhone sales. WeChat is by far the most popular messaging app in China, with a monthly user base topping 1 billion.

Despite the potential downside for the tech giant related to the WeChat ban, shares of Apple were up 1.3% by Monday afternoon. Part of the reason is likely some positive analyst commentary from Wedbush. Wedbush raised its price target on Apple stock from $475 to $515 on Monday, driven by increased optimism for the company's upcoming iPhones. Under the best-case scenario, Wedbush sees Apple stock rising to $600.

Apple is facing a lot of uncertainty. The company will be launching new iPhones later this year into a very weak economy, and the WeChat ban has the potential to derail its business in China. Despite this, the stock is trading right around its all-time high. It won't take much bad news to send the stock tumbling.

Long odds for Microsoft deal for TikTok

Chinese social media app TikTok will also be effectively banned in the United States in 45 days, via a separate executive order. Microsoft has been in talks to acquire the U.S. operations of the app, which would potentially solve the U.S. government's data security concerns. But a deal is looking less likely.

South China Morning Post is reporting that TikTok's Chinese owner ByteDance is preparing to escalate its legal battle against the U.S. It also cited a source that said that the probability of Microsoft buying TikTok is at most 20%. The odds of Twitter, another potential suitor, buying the company are even lower due to Twitter's lack of resources.

It may be for the best that a deal is unlikely to happen. Microsoft would likely need to shell out tens of billions of dollars for the app, and it would expose itself to regulatory scrutiny and the trade war between the U.S. and China. Microsoft co-founder Bill Gates called the deal "a poisoned chalice" in an interview with Wired, citing the downsides of Microsoft becoming a big player in social media.

Microsoft stock was down 2.1% by Monday afternoon, although it's unclear whether the TikTok deal was the driving force. Like Apple, Microsoft stock trades close to its all-time high. And like Apple, it won't take much bad news to put pressure on the stock.