Pestilence On The Move Once Again: All Macau Casinos in China Will Shut Down Monday as COVID Outbreak Worsens, Pale Horse In Play

HNewsWire: Macau, the greatest gaming hotspot in the world, will close almost all casinos and non-essential enterprises for a week beginning on Monday as an epidemic of COVID-19 sweeps over the autonomous enclave on China's south coast.

Macau's senior municipal official, Andre Cheong, told a news conference on Saturday that casinos would be closed from July 11 to July 18 due to "static management." The AFP cites Andre Cheong as saying this. Only critical establishments will stay open, such as supermarkets, petrol stations, and pharmacies.

The step came after Macau reported 71 new COVID cases on Saturday. Since June 18 a total of 1,374 illnesses have been registered, a modest amount yet sufficient for the city to apply the severe zero-COVID policy of mainland China.

The most popular casino in Macau, the Grand Lisboa, was shuttered last week after 13 diseases were discovered at the casino/resort complex.

Macau is the biggest gambling center in the world, surpassing Las Vegas. More than half of the city's GDP is generated from the gaming sector, and 20 percent of the population is employed by casinos. Due to the economic burden of imposing strict lockdowns and widespread testing, the curb will deliver a severe blow to the community.

The zero-COVID measures (particularly shutting down Shanghai for two months) have caused an economic downturn in the world's second-largest economy since President Xi Jinping made it apparent a few weeks ago that "COVID zero" is here to stay. The likelihood that Beijing's 2022 growth objective of 5.5% can be attained is diminishing because to the continuing danger of fresh lockdowns.

Bloomberg reported last week that Beijing has decided to issue 1.5 trillion yuan ($220 billion) in "special" local bonds in the second half of the year to finance infrastructure expenditure to counteract the recession.

How will Macau gaming stocks respond to the weekend's news? Following an index of casino stocks in the city that has failed to establish support at a 2015/16 low, we anticipate a continuation of the decline.

The US casino businesses operating in Macau include Wynn Macau Ltd, Sands China Ltd, and MGM China Holdings Ltd, whose shares are anticipated to decline on Monday in response to the news.

Bloomberg adds, "Beyond the virus, the casino business has other hurdles, such as a new regulation that dramatically tightens government supervision over operations and Beijing's crackdown on high-stakes gamblers to limit capital outflow."