Marlins COVID-19 Outbreak Throws A Curveball At MLB Season, Sports Betting Stocks

Just days after Major League Baseball began its dramatically shortened season, multiple games have been postponed due to a COVID-19 outbreak among MLB players and staff. Concerns and rumors surrounding the remainder of the season has several stocks trading lower.

What Happened: MLB has taken extreme caution to keep its players and staff safe, including playing in front of empty stadiums, conducting regular testing and banning players from spitting during the games.

However, the Monday game between the Miami Marlins and Baltimore Orioles and the game between the Philadelphia Phillies and New York Yankees has been canceled after at least 13 Marlins players and staff members tested positive in recent days. The Marlins played the Phillies during their opening series of the season.

In a statement, MLB said members of the Miami Marlins traveling party are self-quarantining while the league conducts additional COVID-19 tests. The league will also hold an "emergency" meeting to discuss any further steps related to the teams and the shortened MLB season.

Market Reacts: The news sent shares of fantasy sports leader DraftKings Inc DKNG down 7.3% on Monday.

The start of the MLB season reportedly triggered a boom in sports betting at the Borgata casino in Atlantic City. Borgata reportedly took the equivalent of three weeks' worth of MLB bets during the first three days of the season last week despite its casino floor is limited to just 25% capacity.

In addition to DraftKings, other MLB-linked stocks traded lower on Monday as well. U.S. regional casino and sportsbook operator Penn National Gaming PENN, the parent company of sports media company Barstool Sports, traded lower by 6.4%. Shares of Atlanta Braves owner Liberty Braves Group BATRK were down 2.8%.

DraftKings Shares Dip Sharply To Session Low As Traders Circulate Tweet From Account Posing As SportsCenter That Suggests MLB Cancelled Season; This Was Not The Verified SportsCenter Account; DraftKing Shares Rebounded Immediately, But Still Lower #MLB pic.twitter.com/nI2Imq2PoO

— Benzinga (@Benzinga) July 27, 2020

Benzinga’s Take: At this point, MLB has given no indication the season is in jeopardy, but an outbreak within the first few days of games is close to a nightmare scenario for the league. The three stocks mentioned above, as well as any other companies with exposure to MLB and sports gambling, will likely continue to be extremely volatile until the MLB is certain it can continue its season safely.

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Photo credit: Roberto Coquis, Wikimedia