The global stock market plunged on Monday (5th August), the worst trading day since 2022. The brutal stock market sell-off affected several companies in the gaming industry.
Fears of a slowing US economic growth caused several major indexes to plummet around the globe. The employment report from last week was weaker than expected. The stock market’s decline on Monday was mostly attributed to the recent news.
A number of companies in the gambling sector saw a marked drop on Monday. Some of the major operators saw their 52-week lowests hit during that day. Among these were Las Vegas Sands ($36.62/PS28.65/EUR33.43), Wynn Resorts ($71.63) and MGM Resorts ($33.44).
In Japan, the Nikkei 225 Index plunged 12.4% in its first hour of trading. This was the worst single-day decline since Black Monday 1987. The S&P 500 fell 3% in the US. This is the biggest drop since September 2022. The Dow Jones Industrial Average dropped by 2,6%, Nasdaq fell by 3,4% and Russell 2000 was down by 3.3%.
The “Magnificent Seven”, a group of US companies that includes Apple, Meta, Nvidia and Microsoft as well as Tesla, Alphabet, Alphabet, Amazon, all closed sharply down. The Wall Street Journal reported that their losses alone erased more than $650bn of market capitalization.
The wave of unease also affected other securities. Bitcoin fell by approximately 7%. Gold rates dropped intraday more than 2%. Commodities also suffered. Cboe Volatility Index (also known as “fear Index”) rose to the highest level since the Covid Pandemic.
Operator, supplier stocks see declines
Other companies also suffered. Caesars Entertainment fell almost 7%, but still managed to stay just above the 52-week minimum of $31.74. Boyd Gaming dropped 2% while Red Rock Resorts, Churchill Downs, and Churchill Downs all fell 3.7%.
DraftKings’ sportsbook fell only 0.7% but in its five most recent days, it has seen a total drop of almost 14%. The main reasons for this are the missed Q2 results and negative criticisms of their announcement about a surcharge on bettors from high-taxed states. FanDuel’s owner, Flutter, fell just under 3%, to $181.83.
Light & Wonder fell almost 5%. IGT fell 1.3% and erased a portion of its gains from the deal with Everi, under Apollo Global Management. Inspired Entertainment’s share price has dropped by over 17% during the past week. 8% came on Monday.
Frank Fantini is the founder of Fantini Research – a gambling financial specialist. He told iGB stocks may continue to perform below expectations. The overall market, he said, is “still overvalued,” and cited big tech companies as an example.
Also, he said that “weaker consumer can force a contraction.” Today could be an early warning.
