Macau’s casinos have been suffering in terms of revenue since the beginning of the year. The dip in gaming revenues has been attributed mainly to the slowdown in the Chinese economy amidst the ongoing US-China trade war.
However, for the past two months, the casinos have pulled in revenues par-expectation. While in May Macau casino operators posted a positive gaming revenue figures, in June Macau casino revenues, went up by a significant 5.9 percent year-on-year defying the predictions which estimated it to increase by a meager 1.8 percent.
Following the strong performance of the casinos, the market responded as expected. Bloomberg intelligence index of Macau casino shares jumped by 7 percent in early Hong Kong trading on Tuesday.
Bloomberg Quint reports that JPMorgan Chase & Co. analysts said the data was “surprisingly strong,” while Deutsche Bank upgraded its ratings on Galaxy Entertainment Group Ltd. and MGM China Holdings Ltd. Shares of Galaxy Entertainment shot up by as much as 8.3%; MGM China shares rose as much as 7.5%, while Sands China Ltd. grossed as much as 7.9%.
Analysts and experts opine that the VIP revenue at Macau casinos is stabilizing. Earlier in April, the year-on-year gross gaming revenue fell by 8.3 percent to 23.5bn patacas ($2.9bn). It is by far the most significant revenue drop since June 2016.