PointsBet shares soar 21% as US gambling stocks close higher after interest rate hike
PointsBet was among the top performers in the ASX 200 benchmark index on Thursday (28 July) after the operator’s share price rocketed by 21%.
At market close, the stock finished trading at A$3.57 per share.
In June, reports emerged that PointsBet had rejected an approach of more than A$220m from Rupert Murdoch’s News Corporation.
Aside from M&A whispers, the most recent share uptick has coincided with an upturn in fortunes for US-listed operators, as most gambling stocks closed higher on Wednesday (27 July).
Caesars’ stock was up 8.9% and DraftKings gained 8.1%, while shares in Rush Street Interactive traded 6.5% higher. The top three performers were followed by MGM (4.94%) and Penn National Gaming (4.75%).In the US, investors widely welcomed the US central bank’s decision to rise the interest rate by a further 0.75% to a range of 2.25%-2.5%.
While this marks the highest level since 2018, markets largely expected the move, which was seen as a signal that the Federal Reserve will slow the pace of rate hikes later this year.
Investors had been concerned that aggressive interest rate hikes could tip the US economy into a recession.
The latest increase, aimed at cooling inflation, came on top of a 0.75% hike in June, as well as smaller rises in May and March.
When the closing bell rang on Wednesday, the S&P 500 had climbed 2.6% and the tech-heavy Nasdaq had surged by 4.1%. This marks the Nasdaq’s biggest rally since November 2020.
Shares in tech giants Microsoft (6.7%) and Alphabet (7.7%) both gained despite reporting quarterly earnings below expectations, as analysts maintained optimistic long-term growth outlooks for both companies.