Wynn Leads Casino Stock Rise After China Signals New Support for Macau
Lily Katz
BloombergBusiness
October 2, 2015 — 10:58 AM CDT
Wynn Resorts Ltd. rose the most in more than six years, leading casino stocks higher following a report that the Chinese government plans steps to revive the flagging gambling industry in Macau, where betting has been in freefall.
Wynn, which generated 70 percent of its revenue in the region last year, jumped 17 percent to $60.29 at 11:32 a.m. in New York, the biggest intraday gain since May 2009. Las Vegas Sands Corp. rose 8.1 percent to $39.99, while MGM Resorts International advanced 4.4 percent. Their Hong Kong-listed subsidiaries also rose.
Macau’s casino-dependent economy has been suffering from an economic slowdown in China and a campaign against corruption, with gambling revenue in the betting enclave dropping for 16 straight months. Li Gang, director of the China’s local liaison office, said the government will introduce support policies by the end of this year, according to Teledifusao de Macau.
“Any potential measures to help Macau’s visitation could be a great boon for the industry, as casual gamblers are now becoming the key pillar of the industry profits in the midst of VIP weakness,” DS Kim, an analyst at JPMorgan Chase & Co., wrote in a note.
Gross gaming revenue in Macau fell by a third in September. Results released Thursday showed casino revenue declined 33 percent to 17.1 billion patacas ($2.2 billion) in September.
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