The Chinese government took casino investors on a wild ride Thursday when the imposition of new ATM transaction limits in Macau caught the market by surprise.
The Drop
Shares of Melco Crown Entertainment Ltd (ADR) MPEL 0.95%, Wynn Resorts, Limited WYNN 1.28%, Las Vegas Sands Corp. LVS 1.23% and MGM Resorts International MGM 2.16%plummeted 4–15 percent in a matter of minutes on Thursday afternoon when the South China Morning Post published a story revealing that the Chinese government would be cutting the limit for China UnionPay ATM transactions in Macau from 10,000 patacas to 5,000 patacas.
The market seemed concerned that the government was cutting the daily withdrawal limit in Macau for all ATM cards, which would have potentially had a huge negative impact on casino business. However, overnight, Macau officials clarified that the change relates to single ATM card transactions only. There has been no change to the daily withdrawal limit of 10,000 yuan.
Pre-Market Recovery
Macau investors seemed to be breathing a sigh of relief in the pre-market session on Friday now that they have been reassured that gamblers’ daily withdrawal limits haven’t changed. After 26 consecutive months of negative gaming revenue growth, Macau has delivered…
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