Macau stocks rally after strong June GGR

Macau casino stocks saw their largest rally since December after better than expected GGR results in June.

According to a Bloomberg Intelligence Index, Macau casino shares climbed as much as 7 percent in early Hong Kong trading on Tuesday.

JP Morgan analysts said the data was “surprisingly strong”, while Deutsche Bank upgraded its ratings on Galaxy Entertainment Corp and MGM China Holdings. 

JP Morgan’s DS Kim said it appears that VIP demand is finally stabilizing and that Macau is showing no signs of growth fatigue yet. 

The casino stocks took a 20 percent tumble in May, facing challenges from the US-China trade war, a ban on smoking on casino floors, and new IRs pulling VIPs to other countries. 

June represented the second straight month of growth this year, with gaming revenue up 5.9 percent year-on-year.