Macau casino stocks tumble as U.S.-China trade tensions escalate

Shares of major Macau casino operators plunged on Monday as intensifying trade tensions between the United States and China triggered a broader sell-off in Hong Kong markets, with the Hang Seng Index posting its steepest single-day drop since the 1997 Asian financial crisis.

The Hang Seng fell more than 13%, weighed down by sharp declines in gaming stocks. Galaxy Entertainment Group sank 12.44%, Melco International Development dropped 16%, and SJM Holdings lost 18%, with all three hitting three-year lows.

Wynn Macau fell 13% to a six-month low, while Sands China declined over 14%, also marking a six-month trough. MGM China Holdings slid nearly 12%, its worst performance in three months.

The rout comes amid increasing investor concerns over U.S. regulatory scrutiny and geopolitical friction. In February, the United States designated Macau as a “foreign adversary,” placing the Chinese Special Administrative Region in the same category as Russia, Cuba, and Venezuela, citing national security concerns.

Equity research firm Morningstar warned that U.S.-based casino operators with exposure to Macau face a “higher risk premium” amid the escalating trade conflict. The firm adjusted its fair value estimates for Las Vegas Sands and MGM Resorts, lowering them to $53 from $56 and to $46 from $49, respectively. Wynn Resorts’ valuation was maintained at $111.

Macau remains a critical market for U.S. casino giants. Morningstar projects that by the end of the decade, Macau will account for 60% of Las Vegas Sands’ EBITDA, 50% of Wynn Resorts’, and 20% of MGM Resorts’.