What happened
Shares of casino giant MGM Resorts International (MGM -2.58%) jumped 15.7% in June, according to data provided by S&P Global Market Intelligence, as investors got more bullish on the entire industry.
So what
The biggest news for MGM Resorts came early in the month when Macao released its casino revenue figures. The region saw $3.21 billion of gambling revenue, which was up a modest 1.8% from a year ago, but a big change from the 8.3% decline we saw in April.
The Macao skyline, including the tricolor MGM resort at the right. Image source: Getty Images.
In the U.S., improving investor sentiment about the economy and trade wars, which pushed the entire market higher, had a disproportionate effect on a casino stock like MGM because it's generally seen as a leveraged bet on consumer spending.
Now what
There wasn't a significant change in MGM's operations in June, but rather a change in market sentiment. Investors grew more bullish overall, pushing the entire market higher, and casino stocks were a big beneficiary. What I'm watching most closely in the rest of 2019 is Macao's gambling revenue and the share MGM captures. The company recently opened MGM Cotai there, which could be its best performing casino when fully operational. So there's a lot riding on Macao even though it contains only two of the company's resorts.
