Macau casino stock prices declined after Fitch downgraded the ratings of Las Vegas Sands Corp, SJM Holdings and MGM Resorts International due to a possible increase in the oversight of gaming concessionaires.
Macau.- Casino share prices were down after Fitch Ratings revised its outlook for three Macau casino operators and placed them with negative ratings. According to media reports, fears surrounding a possible increase in the oversight of gaming concessionaires were also responsible for the fall.
The stock prices of Wynn Macau and MGM China fell 9 per cent while Sands China shares declined 6.9 per cent and Galaxy Entertainment shares by 4.2 per cent. SJM Holdings shares were down 4.2 per cent and Melco International Development 7.9 per cent.
Analysts at Fitch Ratings said the decision to downgrade the casino operators rating was taken because “failure to secure a new gaming concession or more onerous economic licensing conditions” may have a significant negative credit impact.
However, the ratings agency said it expects the arrangement to be “pragmatic” in the period after June 2022, when the six existing Macau casino operating agreements will expire. Fitch added that it believes all three will “continue to operate in Macau for a long time.”
Fears about a potential spread of the Covid-19 Omicron variant in China could also affect Macau casino stocks despite authorities in mainland China reporting that the most recent outbreak was under control. A few weeks ago, Macau casino stocks were also affected by the arrest of Alvin Chau Cheok Wa, CEO of Suncity Group Holdings.