Melco Crown Entertainment Ltd. (MPEL:US) dropped in New York on concern the World Cup will draw visitors away from its casinos, while solar maker Yingli Green Energy Holding Co. rose before an earnings report.
Melco retreated to trade at a discount to its Hong Kong shares for the first time in a week. Yingli climbed to a seven-week high amid expectations that the biggest solar panel maker will reduce losses when it announces first-quarter results today. NQ Mobile Inc. (NQ:US), the Chinese mobile-service provider, closed at the lowest this month. The Bloomberg China-US Equity Index (HSCEI) rose 0.1 percent to 104.69.
Gross gaming revenue at Macau casinos may decline 8 percent in June from a year ago as would-be customers watch the monthlong World Cup that started June 12, David Bain, an analyst at Sterne Agee & Leach, wrote yesterday. Yingli will report (MPEL:US) a first-quarter loss of 23 cents a share excluding some items, down from 62 cents a year ago, according to the average of five analyst estimates compiled by Bloomberg.
“Maybe people tend to stay at home during the World Cup instead of traveling to casinos in Macau, which will have an impact on top-line figure in the casinos’ quarterly results,” Jeff Papp, senior analyst at Oberweis Asset Management Inc., which oversees $1 billion in Lisle, Illinois, said by phone. “Near term they are challenged because VIP spenders are being restricted by the Chinese government. Longer term, the growth in mass market is healthy.”
Macau’s government plans to further restrict the use of some debit cards at casinos, the head of SJM Holdings Ltd., the city’s biggest gambling company, said last week. Authorities are curbing money flows to the world’s largest gambling hub by making it harder for bettors to buy expensive items that they exchange for cash.
The iShares China Large-Cap ETF (FXI:US), the largest Chinese exchange-traded fund in the U.S., slipped 0.2 percent to $38.02, retreating after a five-week rally. The Standard & Poor’s 500 Index added 0.1 percent as corporate deals and growth in American manufacturing overshadowed escalating tension in Iraq.
Melco’s American depositary receipts slumped 2.4 percent to $32.48, halting a four-day rally.
“Our checks suggest ferry lines were lighter than usual” in the first half of June, partly due to the start of the World Cup, Cameron McKnight, an analyst at Wells Fargo & Co., wrote in a note yesterday. “2014 could be choppy due to a potential slowdown in VIP driven by decelerating credit growth and a softer macro environment.”
Yingli’s ADRs climbed 6.7 percent to $3.52, the highest close since April 25. The company is scheduled to report (YGE:US) its first-quarter financial results before U.S. market opens today.
Sales at the Baoding, China-based company may have grown 9 percent to $470 million in the first quarter, the average estimate of six analysts compiled by Bloomberg show. Net loss may narrow to $36.9 million, compared with a $103.4 million loss a year earlier, according to analysts’ projections.
“Some people are speculating that Yingli’s first-quarter earnings may come better than estimated,” Gordon Johnson, an analyst at Axiom Capital Management in New York, said by phone. “Yingli could surprise to the upside. Investors should wait for a potential bounce in Yingli when they most likely report higher Japanese shipments” this week, Johnson said.
NQ Mobile, based in Beijing, slid 6.3 percent to $7.44 in New York.
Ctrip.com International Ltd. (CTRP:US), China’s biggest online travel agency, surged 4.9 percent to a record $60.06.
The Hang Seng China Enterprises Index was little changed at a five-month high of 10,522.13. The Shanghai Composite Index (SHCOMP) climbed 0.7 percent to 2,085.98, the highest level since April 18.
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