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Casinos Face Stock Drop After Macau News
NEW YORK, NEW YORK --
The stocks of the major casino players in Macau have taken a tumble recently, as the Chinese government seems determined to slow the explosive growth the tiny enclave has undergone in the last few years. MGM Mirage, Las Vegas Sands, and Wynn Resorts all saw the price per share of investing in their companies decline following a Morgan Stanley report that the Beijing government was considering visa restrictions and other methods to slow gaming growth.
China had been upfront for weeks about examining ways to lessen the burden on the outdated and overworked infrastructure of Macau, and to bring the development and expansion of gambling under control, reducing them to a more manageable pace.
Among the possible solutions being debated by Chinese officials are further restricting visas from the current one visit per two month allowance to a six month program. The issuing of new casino licenses has been suspended.
Morgan Stanley suggested growth would drop from the current fifty percent for the year's first half to around twenty-five percent for the rest of 2008, and sixteen percent for 2009, still quite a healthy rate.
When the report was released Tuesday, MGM Mirage and Las Vegas Sands both had their stocks decline eleven percent, while Wynn Resorts was off seven percent, despite no new information in the Morgan Stanley announcement.
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