Gaming, Travel Stocks Fall Amid Coronavirus Outbreak
By Dave Sebastian
Stocks of gaming, airlines, lodging and online-travel-agency
companies declined in premarket trading Monday as global stocks
fall on fears surrounding the coronavirus outbreak.
Shares of casinos with operations in Macau such as Wynn Resorts
Ltd. (WYNN), Las Vegas Sands Corp. (LVS) and MGM Resorts
International (MGM) fell 6%, 5.7% and 3.4%, respectively.
"We expect the news flow to continue to evolve, given the
Chinese government cancellation of tours globally and the most
extreme possibility of the Macau government shutting down all
casinos," Jefferies gaming, leisure and lodging analyst David Katz
said in a note to clients. "At present the impact on estimates and
the stocks near term, remain speculative."
Shares of airlines, some of which have allowed customers to
cancel or change flights with no fee, also fell. United Airlines
Holdings Inc. (UAL), American Airlines Group Inc. (AAL) and Delta
Air Lines Inc. (DAL) were off 3.5%, 3.4% and 3.1%, respectively.
American depositary shares of China Eastern Airlines Corp. (CEA)
and China Southern Airlines Co. Ltd. (ZNH) were down 7.1% and 5.3%,
ADRs of Chinese online-travel agency Trip.com Group Ltd. (TCOM)
were off 9.4%. Shares of Expedia Group Inc. (EXPE), TripAdvisor
Inc. (TRIP) and Booking Holdings Inc. (BKNG) fell 4.1%, 3.8% and
Shares of Marriott International Inc. (MAR), Hyatt Hotels Corp.
(H) and Hilton Worldwide Holdings Inc. (HLT) declined 2.2%, 2.1%
and 2.1%, respectively. Shares of cruise lines Carnival Corp.
(CCL), Royal Caribbean Cruises Ltd. (RCL) and Norwegian Cruise Line
Holdings Ltd. (NCLH) respectively fell 3.2%, 4.2% and 3.1%.
Mr. Katz said the travel restrictions in and around Wuhan and
cancellations of Lunar New Year events would weigh on companies'
first-quarter results. "But how large and will it linger onward
remain the questions," he said, adding that a "Buy on weakness"
call would be premature.
The pneumonialike virus has infected more than 2,700 people and
killed at least 80, the vast majority in Hubei province, of which
Wuhan is the capital.
Write to Dave Sebastian at email@example.com
(END) Dow Jones Newswires
January 27, 2020 08:05 ET (13:05 GMT)
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