Macau Casinos Fall on Tourism Restriction Speculation

Shares of casinos with operation in Macau fell in Hong Kong trading on Tuesday. This weakness occurred on speculation that the Chinese government may be considering tightening its visa and credit policies. This potential tightening could cause a drop in tourist visits from the Chinese mainland according to

. In a Monday note, Wells Fargo said the Macau Daily reported that the territory's visa issuance could be tightened. Visas allow mainland Chinese to travel to the tourist and gaming region. The note also speculated that credit limits on a popular credit card, the China UnionPay card, could be reduced. While casino stocks fell in Hong Kong, U.S. traded casino stocks with exposure to Macau were up modestly on Tuesday. Wynn Resorts

, for example, was trading up around 0.1% while MGM Resorts

was up around 0.5% for the day. Wells Fargo analyst Cameron McKnight wrote that it could not be determined from Chinese press reports “whether tighter policies have already or will soon be implemented, or whether proposals are simply being mooted." In 2008-2009, the Chinese government implemented visa restrictions to Macau. These restrictions caused gaming revenue to fall substantially during the period, according to Wells Fargo. McKnight said that “If 2008-2009 is any guide, investors, analysts and potentially the gaming concessionaires themselves are likely the last to know if in fact a visa- policy change has occurred." The firm said that individual travel visas account for 25% of tourist visits to Macau and around 41% of mainland tourist visits.