Casino stocks push part recession worries to rally on Friday

The casino sector saw notable gains on Friday as part of a broad rally in consumer discretionary stocks. 

While casino companies did not generate a lot of news during the week, a round of disappointing earnings forecasts from retailers and cautious guidance update from airline companies led to declines across leisure, lodging, and travel stocks. Investors took a cautious approach towards casino stocks, in particular for most of the week, with companies that can maintain profitability even in challenging economic conditions attracting attention.

As part of the mini-reversal on Friday, Caesars Entertainment (CZR)  rose 6.1%. Penn Entertainment (PENN) rallied 5.7% and MGM Resorts International (NYSE:MGM) was up 5.3%. Other notable gainers included Red Rock Resorts (RRR) +4.9%, Golden Entertainment (GDEN) +3.6%, and Boyd Gaming (BYD) 3.0%.

The VanEck Gaming ETF (NASDAQ:BJK) was up 1.9% on the day. The ETF, which aims to track the overall performance of companies involved in casinos and casino hotels, sports betting, lottery services, gaming services, gaming technology and gaming equipment, has outperformed the S&P 500 Index on the year. Top holdings include Arisocrat Leisure (OTCPK:ARLUF), VICI Properties (VICI), Flutter Entertainment (FLUT), DraftKings (DKNG), and Evolution AB (OTCPK:EVVTY).