Monday's still unexplained sell-off saw online lottery's stock price plunge over 25 percent
The Hong Kong management at Chinese-facing online lottery firm 500.com spent much of Tuesday trying to claw back investor confidence following a still-unexplained major sell-off on Monday that sent the company's stock plunging over 25 percent.
They were successful in improving the situation by around 12 percent, but the sharp decline left many analysts and investors confused and worried.
Thursday may throw more clarity on the confidence issue when the company reports on its Q3-2016 performance, but pessimism rules at present based on the lack of online lottery revenues since the Chinese authorities cracked down on the vertical over 18 months ago, imposing a rather lengthy suspension whilst the position was reviewed following allegations of official corruption at provincial level.
500.com's revenue shrank to less than a quarter million dollars in the wake of the clampdown, and much of that came from a subsidiary, Sumpay that has since been sold off.
The inability of either the company or the authorities to say when the 'suspension' is to be lifted (if at all) has made the future of 500.com uncertain, further unsettling investors.
However, the massive potential of the Chinese lottery market, as evidenced by the continued growth of revenue from sales in the Welfare and Sports lotteries on the mainland, remain a temptation to stay invested in the company in the hope that the suspension will be lifted and the good times will roll again.
Online Casino News Courtesy of Infopowa