Casinos Stocks Plummet On Concerns Over China Coronavirus

Investor sentiment is often swayed by breaking news and headlines, keeping the stock market in its thrall. At present, the coronavirus outbreak in China is not only keeping Wall Street on edge but the global market at large. All major indices ended the day in the red territory yesterday.

The death toll from this coronavirus outbreak — which originated in the city of Wuhan on the banks of Yangtze River, between Shanghai and Chongqing — has reached nine. Moreover, more than 440 have succumbed to the virus.

The infectious nature of China coronavirus has made it a bigger risk. Notably, China coronavirus cases have also been registered in Japan, South Korea and Thailand. The coronavirus has evoked the memories of 2002 SARS epidemic, which spread worldwide in a short period of time.

Casinos Stocks Bear the Brunt of Coronavirus

Macau, the world’s largest gambling hub, will be impacted by any hesitation to travel to China. MGM Resorts International (NYSE:MGM) , Melco Resorts & Entertainment Limited (NASDAQ:MLCO) , Wynn Resorts, Limited (NASDAQ:WYNN) and Las Vegas Sands Corp. (NYSE:LVS) declined 6.2%, 9.6%, 6.1% and 5.4%, respectively, on Jan 21.

Dismal Macau performance have already been hurting the casino stocks. The coronavirus outbreak in China has further added to the woes. In December, Gambling revenue in Macau fell 13.7% to 22.84 billion patacas (US$2.85 billion) from the year-ago period. It was the third consecutive month of decline. Consequently, this lower footfall at the local casinos, led to a persistent decline in gaming revenues. Slowdown in China, tighter visa policies, political unrest and smoking ban on mass market gaming floors have compounded the woes.

Moreover, major cruise and airline companies like Carnival Corporation & Plc (NYSE:CCL) , Royal Caribbean Cruises Ltd. (NYSE:RCL) and United Airlines Holdings, Inc. (NASDAQ:UAL) also declined 2.3%, 4% and 4.4%, respectively. Concerns over the virus are likely to impact Lunar New Year travel plans as well.

Just Released: Zacks’ 7 Best Stocks for Today

Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.6% per year.

These 7 were selected because of their superior potential for immediate breakout.

See these time-sensitive tickers now >>