With China easing its lockdowns, pay close attention to casino stocks.
So far, it looks like China’s COVID Zero policy appears to have brought infection numbers under control. Better, according to Bloomberg, the country is reporting the lowest number of new cases since February.
And, according to MarketWatch.com, “The gains come after China’s National Health Commission said it will shorten the country’s quarantine period for international travelers to 10 days from 21 days and loosen testing requirements for people in quarantine.”
With that, some of the biggest beneficiaries of the news have been casino stocks, such as MGM Resorts (MGM), Las Vegas Sands (LVS), Wynn Resorts (WYNN), and Melco Resorts & Entertainment (MLCO).
Even better, “Industry analysts say that any easing of China’s zero-tolerance approach to Covid brightens the outlook for Macau’s casino sector, which has been hit hard by low visitation during the pandemic. The Asian gambling hub recently imposed stricter Covid-19 rules amid a local outbreak of the virus, leading several analysts to lower their forecasts for gross gaming revenue in June,” added Morningstar.com.
If COVID cases stay low, and life can resume some sort of normalcy, oversold casino stocks may be worth the gamble.