Stock prices of gun companies rise following Orlando massacre
Smith & Wesson and Sturm Ruger & Co, the two biggest US firearms manufacturers on the stock market, saw their share prices increase by 6.87 percent 8.50 percent, respectively, by the time the markets closed at 4 pm on Monday.
The surge follows an attack on a gay nightclub in Orlando, Florida that left 49 people dead and 53 wounded on Sunday morning in the deadliest mass shooting in US history. The gunman, Omar Mateen, was killed in a firefight with police.
Traders are betting that many Americans may fear that, in the wake of the attack, stricter gun legislation will prevent them from purchasing firearms, such as the semi-automatic AR-15 rifle said to have been used by the Orlando shooter.
Smith & Wesson sold a record $627 million worth of firearms last year. In the most recent quarter, sales soared by 61.5 percent, a rise CEO James Debney attributed to a “long-term trend toward personal protection.”
Similar spikes in gun company stocks were seen after a terrorist attack in San Bernardino, California and a shooting at Umpqua Community College in Oregon.
The Sunday shooting prompted President Barack Obama to give a speech in which he reiterated his call for stricter regulations on firearms.
“We are also going to have to have to make sure that we think about the risks we are willing to take by being so lax in how we make very powerful firearms available to people in this country,” Obama said. “And this is something that obviously I’ve talked about for a very long time."
The act was committed by an Islamic radical, and law enforcement efforts are “being treated as a terrorist investigation.”
Obama has also ordered federal buildings to fly their flags at half-mast until sunset on Thursday.