Streets empty, stock shares down because of Macao COVID shutdown

The streets of Macao were empty and stock shares for Las Vegas companies operating in the Chinese gambling enclave dropped dramatically as the region endured its second full day of a weeklong government-imposed shutdown of the city.

Businesses, including casinos, are expected to remain closed through July 18 because of coronavirus concerns.

Residents were told to stay indoors unless they were buying food or other necessities. Authorities warned that anyone violating the rules would be punished, The Associated Press reported.

Casinos were ordered over the weekend to close for at least a week as the number of coronavirus cases in the territory of 700,000 people rose. On Monday, the government reported 59 new cases, bringing the total in the latest outbreak to 1,526.

Macao and Hong Kong are imitating the mainland’s “zero COVID” strategy that aims to isolate every infected person. About 500 people are reported confined within the Grand Lisboa resort on the Macao peninsula.

The public is required to register for passes to ride buses and other public transportation, which is operating at a reduced capacity, said a resident who asked to be identified only by his surname, Kong.

The Macao government’s order marks the first time since February 2020 at the start of the pandemic that casinos were closed outright, reflecting official urgency about containing the latest outbreak. Restrictions imposed in June limited their workforce to 10 percent of normal levels.

The government says it plans to test everyone in the city for the virus over the coming week. Bus drivers, people who deliver food and some others were told to be tested every day.

The inactivity in the city’s 41 casinos, including six for market leader Las Vegas Sands Corp., three for Wynn Resorts Ltd. and two for MGM Resorts International, has resulted in stock shares on both the Hong Kong and U.S. markets to fall by as much as 8 percent.

Shares of Las Vegas Sands, traded on the New York Stock Exchange on Monday, closed down $2.17, 6.3 percent, to $32.31 a share on volume nearly double the daily average.

Wynn Resorts shares, traded on the Nasdaq exchange, were down $3.65, 6.5 percent, to $52.81 a share on volume nearly three times the daily average.

MGM shares, traded on the New York Stock Exchange, were down 94 cents, 3.2 percent, to $28.40 a share on volume just below the daily average.

Stocks didn’t perform much better on the Stock Exchange of Hong Kong.

Sands China Ltd., affiliated with Las Vegas Sands, was down $1.52, 8.15 percent, to $17.14 at Monday’s close.

Wynn Macau Ltd., affiliated with Wynn Resorts, was off $0.35, 6.7 percent, to $4.89.

MGM China Holdings Ltd., affiliated with MGM, was down $0.23, 5.4 percent, to $4.06.

Sands on Monday made a filing with the U.S. Securities and Exchange Commission detailing an unsecured term loan agreement with Sands China Ltd. for $1 billion (U.S.).

Under terms of the loan, repayable by July 11, 2028, “in the first two years from July 11, 2022, Sands China Ltd. will have the option to elect to pay cash interest at 5 percent per annum or payment-in-kind interest at 6 percent per annum by adding the amount of such interest to the then-outstanding principal amount of the SCL Subordinated Loan, following which only cash interest at 5 percent per annum will be payable.

The SCL Subordinated Loan is pre-payable by SCL in whole or in part at any time without penalty.”

Sands provided no further information on the loan. MGM and Wynn indicated Sunday that they would have no additional comment.

The Review-Journal is owned by the Adelson family, including Dr. Miriam Adelson, majority shareholder of Las Vegas Sands Corp., and Las Vegas Sands President and COO Patrick Dumont.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter. The Associated Press contributed to this report.