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Gun stocks rise after shooting

Olin, the maker of Winchester ammunition, rose as much as 5.1 per cent to $36 on Monday morning, the biggest intraday gain since February 21

Polly Mosendz & Kyle Stock | Bloomberg 

Las Vegas Shooting
Police officers stand at the scene of a shooting near the Mandalay Bay resort and casino on the Las Vegas Strip (Photo: AP/PTI)

The grim predictability of stock-market reactions to US mass shootings—where before a final tally of casualties can be reached, shares of gun makers rise—continued Monday in the wake of a Las Vegas attack that killed at least 50 and wounded hundreds more.
 
Historically, gun stocks have experienced a bump after a mass shooting for reasons both political and emotional. Gun sales typically rise over concerns that a deadly event could lead to more stringent gun-control legislation. An additional driver of sales, and by extension shares, is the rush by some consumers to purchase guns to defend against future attacks.

 
Authorities said that Stephen Craig Paddock opened fire from a hotel room high above a crowd attending the Route 91 Harvest Festival concert near the Mandalay Bay hotel. Paddock was later killed by police.
 
Olin, the maker of Winchester ammunition, rose as much as 5.1 per cent to $36 on Monday morning, the biggest intraday gain since February 21. American Outdoor Brands, formerly Smith & Wesson Holding Corp, gained about 7 per cent and Sturm Ruger & Co was up more than 6 per cent. Following the Pulse nightclub shooting in Orlando, last summer, which left dozens dead, Sturm Ruger and Smith & Wesson saw stock prices increase. The same phenomenon occurred after the San Bernardino, Calif. shooting in late 2015, which left 14 dead.
 
In the past, gun rights supporters and organisations such as the National Rifle Association have warned of future regulatory efforts Democratic administrations may try to impose using a mass shooting as justification. This pattern continued throughout the Obama administration, even when the Democratic Party lost control of the House and Senate. Things could turn out differently, however, now that Republicans control the White House and both houses of Congress.
 
Gun makers have made it clear they see a connection between the partisan politics, high-profile shootings, and their business. “Concerns about presidential, congressional, and state elections and legislature and policy shifts resulting from those elections can affect the demand for our products. 

First Published: Tue, October 03 2017. 03:10 IST
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