JPMorgan said that it turned optimistic about Macau's gaming industry in June 2025, as it judged the industry to be in an 'upcycle,' driven by high-end demand from the wealth effect, ample market liquidity and a K-shaped economic divergence. In the subsequent quarters, GGR exceeded the market's most optimistic expectations. However, profit margins have not improved in tandem, with earnings growth lagging behind the increase in GGR over the past two quarters. The broker expected a similar situation in 4Q25, mainly due to higher operating expenses and a faster VIP skew. Related NewsUBS Expects MGM CHINA (02282.HK) Property Upgrades to Help Maintain Mkt Shr This Yr; Rating BuyTherefore, JPMorgan downgraded SJM HOLDINGS (00880.HK) -0.020 (-0.851%) Short selling $13.69M; Ratio 35.473% from Neutral to Underweight, and Melco Resorts & Entertainment (MLCO.US) from Overweight to Neutral, adopting a selective strategy focusing on market consensus risks and individual valuations. GALAXY ENT (00027.HK) -0.340 (-0.836%) Short selling $64.78M; Ratio 11.287% remains the broker's top pick. JPMorgan also removed SANDS CHINA LTD (01928.HK) -0.340 (-1.796%) Short selling $31.13M; Ratio 7.199% from its top pick list, and advised investors to avoid SJM HOLDINGS and MELCO INT'L DEV (00200.HK) 0.000 (0.000%) Short selling $6.36M; Ratio 24.944% .(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-01-16 16:25.) (Real-time Streaming US Stocks Quote; Except All OTC quotes are at least 15 minutes delayed.)