Share prices for listed casino businesses in Asia – including Macau-related names – sled on Monday, as the Hong Kong market led losses in the region, amid growing fears over a global trade war sparked by tariffs introduced by the United States.
Last week, U.S. President Donald Trump announced an additional 34-percent tariff on all Chinese goods imported into the United States. It was part of a plan establishing a 10-percent baseline tariff on imports from nearly every country, although many nations – including China – are subject to higher rates.
China stated on Friday – a day that the Hong Kong bourse was closed due to a public holiday – that it would impose reciprocal 34-percent tariffs on all imports from the United States.
On Monday, Hong Kong returned from a long weekend with the Hang Seng Index declining 13.2 percent, while the mainland China’s CSI 300 – consisting of the 300 stocks with the largest market capitalisation – plummeted nearly 7.1 percent.
All of Macau’s six casino names retreated more than 10 percent in stock value on Monday, with SJM Holdings Ltd leading with an 18.0-percent decline.
Hong Kong-listed Melco International Development Ltd, parent of Melco Resorts & Entertainment Ltd, fell 16.1 percent on the day; Sands China Ltd was down 14.3 percent; and Wynn Macau Ltd declined 13.0 percent.
Galaxy Entertainment Group Ltd fell 12.4 percent on Monday, and MGM China Holdings Ltd was down 11.9 percent at the close of trading.
NagaCorp Ltd – the firm behind Cambodia’s largest casino, NagaWorld in the capital Phnom Penh – ended 19.9 percent lower in Monday’s trading in Hong Kong.
Hong Kong was not alone in Monday’s downward trend, as all major Asian markets experienced losses, the same happening to a number of listed casino firms.
Philippines-listed Bloomberry Resorts Corp – which runs Solaire Resort & Casino in the country’s capital Manila, and also Solaire North in nearby Quezon City – saw its shares decline 8.7 percent on Monday.
In Singapore, the locally-listed shares of Genting Singapore Ltd – which runs Resorts World Sentosa – ended Monday down 7.5 percent. Sister firm Genting Malaysia Bhd – listed on Bursa Malaysia – recorded a 7.4-percent decline on the day.
Casino operators listed in the South Korean bourse were a bit more insulated from Monday’s meltdown, with declines of between 1.3 percent and 3.9 percent.
Equity research provider Morningstar said in a recent note that “geopolitical and U.S. policy actions” were increasing the “risk premium” for the stock prices of American casino operators with exposure to Macau’s gaming market.
