Lottomatica, betting sector weak after American Kalshi's move

(Il Sole 24 Ore Radiocor) - Changes are in sight in the sports betting sector and the sector is weak in Europe, with Lottomatica Group falling at Piazza Affari. Attracting attention to the sector is the fact that the US regulated prediction markets platform Kalshi is expanding into the sports betting sector by launching a product that mimics parlays, i.e. in sports betting the possibility of combining several events in a single bet. Without any official announcement, during the Monday Night Football game, Kalshi launched a 'build your combo' feature that allows users to combine multiple contracts within a single game. The feature is essentially identical to a 'same game parlay', say analysts at Oppenheimer, who point out that the move represents a further step by Kalshi into the sports betting industry, given that around 90 per cent of its betting volume comes from sports contracts. However, the sports betting business remains limited compared to that of traditional bookmakers and with a limited offer, but it brings the business model closer to that of bookmakers, which could also open the way for legal issues. Kalshi - which is a platform that operates as a regulated market of contracts linked to real events (prediction markets), but in practice functions as a legalised form of financial betting - also allows users to bet on other types of events, such as whether the government will go into shutdown. Stocks in the sector in the US lost heavily, with DraftKings down 11 per cent to $37.47, while shares in Flutter Entertainment, FanDuel's parent company, were 11 per cent in the red at $252.29. Flutter, also listed in London, lost 2.4 percent, as did Entain. 888 Holdings was also down 1.15 per cent.

Also weighing on UK stocks is news that a possible tax increase on gambling in the UK could hit the gross profits of Flutter Entertainment and Entain by 2% and 4% respectively in the 2026 financial year, according to Citi analyst Monique Pollard. The head of the UK Treasury, Rachel Reeves, indicated that she might increase the tax in the 26 November budget, and Citi expects an increase of 5 percentage points.