Why gun stocks soared after Obama's win
In a repeat of 2008, traders anticipated an increase in firearm sales after the election.
In a reaction that surprised absolutely no one, investors rushed into gun stocks after President Barack Obama's win, expecting firearm sales to soar soon.
Gun makers Smith & Wesson Holding (SWHC) and Sturm Ruger (RGR) rose sharply Wednesday in a repeat of sorts of the response to Obama's first presidential victory in 2008. The stocks were up again in Thursday's trading. Gun stocks have performed well over the four years of Obama's term. Sturm Ruger, for example, rose from $7.04 on Election Day in 2008 to $50 Thursday.
But investors think the stocks have farther to go, propelled by fears that Obama will crack down on guns in his second term.
Sturm Ruger shares rose 6.8% Wednesday and another 4.8% Thursday. Smith & Wesson shares rose 9.6% Wednesday and another 3.8% Thursday. By comparison, the Standard & Poor's 500 Index ($INX) fell nearly 2.4% Wednesday and was down slightly Thursday.
The National Rifle Association certainly contributed to fears of expanded gun control in Obama's second term. "An anti-gun Supreme Court, a U.N. Arms Trade Treaty, and a sweeping gun ban aren't just a possibility in a second Obama term," the association's CEO, Wayne LaPierre, wrote on the group's website. "They're a near certainty."
But Obama hasn't taken much action on gun control. In fact, he signed legislation allowing loaded guns into national parks and on Amtrak trains. Still, in the second presidential debate, Obama mentioned the possibility of keeping automatic weapons out of the hands of criminals and the mentally ill.
"Part of it is seeing if we can get an assault weapons ban reintroduced, but part of it is also looking at other sources of the violence, because frankly, in my hometown of Chicago, there’s an awful lot of violence, and they’re not using AK-47s, they’re using cheap handguns," he said.
That comment may have triggered a consumer fear that gun sales will see tighter regulations. In October, the number of federal background checks on potential gun buyers rose 10.6% from the month before to 1.61 million, according to the FBI.
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| Tags: | Kim PetersonRGRSWHC |
While the NRA (of which I am a member) may stoke fears in gun owners it is not irrational to ear what Obama could do in a second term. The article says "but Obama hasn't taken much acion on gun control. Of course not, he still needed to get reelected. The NRA was talking of a second term which Obama hadn't been reelected for yet. Now he is free to do whatever he likes.
I don't like the "poo pooing" of the fears of gun owners. It is not any more irrational to fear sweeping gun control than Pro Choice supporters feared abortion being made illegal. Abortion is going nowhere because it is a popular right. Guns are feared and hated by alot of people who wold just assume they all be banned. Senator Boxer said so herself in an interview. She was asked something along the lines of getting a Democrat majority in Congress and enacting sweeping legislation and she stated yes, "Mr. and Mrs. America...turn 'em in" as she flinched her fingers in a gimme motion.
The Supreme Court only narrowly...by ONE vote...upheld the language and purpose of the Second Amendement. Obama will likely appoint at least one justice and possibly as many as three. How do you think another vote would go on that? We also have that Small Arms Trade Treaty in the UN that is still lurking in a dark corner. That is not going away.
The 2nd Amendment is there, it cannot be ignored by anyone, any attempt to strip people of their guns will prompt an immediate and large outcry, with resulting court cases. The only way for us to lose our guns is for the 2nd Amendment to be repealed, and there is not a chance in hell that will happen, in fact, a lot of DEMs and liberals have guns and enjoy hunting, the 2nd Amendment is safe.
Not true... After his historical and hysterical vote for ObummerCare justice Kennedy also said that the second amendment does not protect the right of commom citizens to own guns. He was opening the door for Obummer again.
Let's see, troops pulled out of Iran, & soon to come home from Afghanistan. That's going to put a crimp in the number of firearms the manufacturers will sell. Hey, let's claim there's going to be a ban on firearms "someday", & improve those sales figures!
No ban. Not now, not ever. Would you want to tell retailers supplied with lots of guns & ammo you're going to take the food off their families' tables? How do you think they'll react?
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