Studio City International Holdings stock jumps 60% on China reopening hopes (NYSE:MSC)

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Shareholders of Studio City International Holdings (NYSE: MSC +63.3%) were the big winners on Tuesday.

Shares of the Hong Kong-based casino operator jumped more than 90% to intraday highs as investors eyed the reopening of its flagship Cotai, Macau casino and seaside resort. While the gains moderated towards Tuesday’s close, the gain was nonetheless remarkable and essentially recouped all of the stock’s heavy losses for the month of May.

The outsized move in stocks is consistent with broader moves for Macau-linked casino stocks in light of falling COVID cases across China. The pandemic trend has raised high hopes that restrictions in major economic regions, including Macau, may soon be lifted.

For example, Shanghai is set to lift what it called “unreasonable” restrictions from Wednesday. Details of the “unreasonable” crackdowns were not spelled out, although the removal of fences blocking residential areas was a hopeful sign.

Meanwhile, Beijing has reopened public transport and shopping malls from Sunday. While Macau has yet to offer specific guidance on its timeline for easing the draconian restrictions, the optimism about reopening is certainly visible in the movements of many region-dependent casino operators.

Melco Resorts & Entertainment was among other major casino stocks making relatively smaller, but still notable moves on the day. (MLCO +5.9%)Wynn Resorts (WYNN +1.3%)and the sands of Las Vegas (LVS +2.5%).

Macau-specific casino stocks: Wynn Macau (OTCPK:WYNMF), Sands China (OTCPK:SCHYY), MGM China (OTCPK:MCHVF), MGM Resorts (MGM), Galaxy Entertainment (OTCPK:GXYEF) and SJM Holdings (OTCPK: SJMHF).

Learn more about a similar move seen in early May that could give investors a sense of deja vu.