Asian casino stocks sink as US-China trade war intensifies
The ongoing trade tensions between the United States and China have rattled global markets, and the casino industry in Asia has also borne the brunt of this volatility. Casinos across Asia were impacted, with several Hong Kong-listed operators hitting multi-year lows on the Hong Kong Stock Exchange (HKEX) on 7 April 2025 (Monday).
The casino stocks plunging is part of a broader Hang Seng sell off, largely driven by the tariff war between the two countries. Hong Kong’s main stock market index, the Hang Seng Index (HSI), fell by over 13 percent on Monday—the steepest decline since the 1997 Asian financial crisis. Among casino stocks, Galaxy Entertainment Group experienced one of the most significant daily losses, with its share price falling over 12 percent to close at HK$26.40 ($3.37), down from HK$30.15 earlier in the week.
Stocks hit along with rest of HK stocks
Melco Resorts & Entertainment experienced a drop of 9.8 percent, hitting $4.80. While Las Vegas Sands, which owns Sands China, dropped by 8.4 percent, closing at $33.37. Wynn Macau dropped 13 percent to hit a six-month low. Interacting with SiGMA News, Andrew Sullivan, founder of Asian Market Sense, explains how Asian stocks have just been hit along with the rest of the Hong Kong stocks. He said, “a lot of international investors get their exposure to China via the HSI so those that are worried about a trade war will sell their Hong Kong stock to reduce their exposure to China.”
The Asian casino stock plunge comes amid US President Donald Trump’s unexpected announcement of sweeping new tariffs, sparking market volatility and investor anxiety across the gambling industry. On the other hand, Chinese President Xi Jinping has called for strengthened efforts to “fully unleash” the country’s consumption potential to encourage growth. However, Sullivan believes it is worth noting that President Xi’s recent statement exhorting people to increase domestic consumption did not mention gambling.
The new tariffs caused casino stocks across the US to tumble sharply on 3 April 2025. The sweeping losses reflect mounting concerns among investors about the potential impact of Trump’s tariff plan on consumer spending and global tourism flows, both of which are crucial for casino and entertainment operators.
Discretionary spending under pressure: experts
Analysts noted that international visitor numbers, particularly from Asia, could take a hit if economic tensions worsen, directly affecting revenues for casino companies. Sullivan said, “The key is that with China slowing, discretionary spending will be under pressure.” He said this would also impact cause arrivals in Macau to be down. Sullivan added that, “The problem is really that Hong Kong gets caught in the crossfire; closely linked to China and close to the US via the HKD/USD peg.”
For context, US President Donald Trump imposed a 34 percent tariff on China, prompting Beijing to retaliate with an equivalent tariff on American goods. This also resulted in research firm Morningstar devaluing stock valuations of leading US casino operators as rising geopolitical tensions between the United States and China cast a shadow over their operations in Macau. The equity research firm cited growing risks tied to policy decisions and international relations, prompting it to reduce its fair value estimates for Las Vegas Sands and MGM Resorts.
