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Gun Company Stocks Rise After Las Vegas Massacre

Gun Company Stocks Rise After Las Vegas Massacre Promo Image

In the wake of the deadliest mass shooting in modern American history, shares of firearms-related companies surged on the stock market. 

Stock for American Outdoor Brands, Smith and Wesson's parent company, rose 3 percent, according to Market Watch. Ruger stock jumped 2.7 percent and stock for Vista Outdoor, which owns Winchester Ammunition, rose 1.8 percent. 

The jump came after a gunman, Stephen Paddock, opened fire on a country music festival in Las Vegas, killing at least 59 and injuring more than 500 people. 

Stocks rose because traders bet on an increase in gun sales, according to CNBC. Following mass shootings, fear of strict gun control regulation tends to increase, prompting gun owners to make more purchases before the law is potentially changed. 

After both the Pulse nightclub shooting in June 2016 and the San Bernardino shooting in December 2015, there was a "two-to-three month surge in firearms sales," Rommel Dionisio, managing director at investment firm Aegis Capital, told CNBC. 

"[Those attacks] certainly triggered something in the American consciousness about personal safety," he said. 

This effect was particularly noticeable during President Obama's time in office. Gun sales overall climbed between 2008 and 2016 as consumers bought more guns just in case national gun control regulation was implemented, according to CNN Money. 

Since Donald Trump was elected, the likelihood of new gun control regulation has declined, bringing down firearms-related stock in the process. 

In August 2017, Ruger said its earnings had fallen more than 50 percent from earnings in 2016, according to CNN Money. 

The gun maker said the reason for the drop was "stronger-than-normal demand during most of 2016, likely bolstered by the political campaigns for the November 2016 elections," according to CNN Money. 

Paddock, the 64-year-old shooter, killed himself in his hotel room as police breached the door. The New York Times reports he had 19 guns in his room, with at least one being fully automatic. 

The Washington Examiner reports that Paddock bought guns from Guns and Guitars, a store in Mesquite, Nevada, but it is unclear if he used those guns in the shooting. 

"All necessary background checks and procedures were followed, as required by local, state, and federal law," said Christopher M. Sullivan, the store's manager. "He never gave any indication or reason to believe he was unstable or unfit at any time. We are currently cooperating with the ongoing investigation by local and federal law enforcement in any way we can." 

The store sells semi-automatic weapons, but not fully automatic ones, which were banned for civilian use in 1986.

Sources: Market Watch, CNN Money, CNBC, Washington Examiner, The New York Times / Featured Image: Marcin Wichary/Flickr / Embedded Images: Sean Savage/Flickr, ElCapitanBSC/Flickr

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