Hong Kong stocks slip as Apple parts suppliers, Macau casino operators suffer on earnings pressure

Macau entered a second week of Covid-19 lockdown, keeping 42 casinos in the city closed, pressuring gaming revenue and city’s coffers

Chinese companies in Apple’s supply chain suffered as the iPhone maker was said to be slowing hiring amid recession risks

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A man walks outside the Wynn Macau casino resort amid the Covid-19 outbreak, in Macau on July 4, 2022. Poor gaming earnings pulled down casino stock in Hong Kong on Tuesday. Photo: Reuters

Published: 10:37am, 19 Jul 2022Updated: 4:55pm, 19 Jul 2022

Hong Kong stocks retreated from a one-week high as Apple parts suppliers in mainland China and Macau casino operators suffered from poorer earnings outlook. Alibaba Group led losses in tech stocks.

The Hang Seng Index slipped 0.9 per cent to 20,649.43 at close, after surging 2.7 per cent on Monday in the biggest gain in six weeks. The Hang Seng Tech Index declined 1.6 per cent while the Shanghai Composite Index was little changed.

AAC Technologies and Sunny Optical tumbled 3.1 and 4 per cent, to HK$15.52 and HK$106.70, respectively, while Luxshare Precision slid 0.3 per cent to 32.42 yuan in Shenzhen. Apple was said to be keeping a lid on hiring amid recession concerns, Bloomberg reported. In Taipei, Hon Hai Precision retreated 1 per cent to NT$104.

Alibaba Group slid 2.9 per cent to HK$100.90, leading losses among Chinese internet-platform operators, while JD.com lost 1.2 per cent to HK$241.

Galaxy Entertainment shed 1.8 per cent to HK$45 while Sands China fell 0.4 per cent to HK$17.24. Gross gaming revenue slumped 62 per cent in June from a year earlier, according to official data, dragging collection down by 46 per cent for the first half. VIP gaming revenue crashed 77 per cent to a two-year low in the second quarter.

Macau entered a second week of Covid-19 lockdown, its first citywide restrictions after managing to contain cases in the past two years. The move has forced the closure of all casinos that contribute the bulk of the city’s fiscal revenue.