Why gun stocks soared after Obama's win

In a repeat of 2008, traders anticipated an increase in firearm sales after the election.

By Kim Peterson Nov 8, 2012 2:41AM
Updated 12:25 p.m. ET

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.Ruger pistols © Getty Images

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: RGRSWHC
835Comments
Nov 8, 2012 1:28PM
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For those that are complaining about the picture. Take a close look at the guy in the blue shirt. Take a closer look at the "gun" in his hand. I'm pretty sure it has a bright orange cap on the barrel. It appears to be a red rider special.

Nov 8, 2012 1:26PM
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Huh, this seems familiar, like this event is repeating itself, almost like this happened in 2008 before Obama was elected, because people KNEW that Obama would crack down on gun owners with harsh regulation, but now that he has won again, people are again buying guns because they wont fall for Obama's facade! They know that Obama was just trying to lull gun owners into a false sense of security. Watch out Obama, these folks are too smart for you.
Nov 8, 2012 1:26PM
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Oh, God. Here come the 2nd Amendment loonies with their bullet proof tinfoil hats. Wait, I thought Obama already took away our guns? So is he gonna do it now? And will it be before or after he hands over the keys to the Whitehouse to Russia? Or is it to Al Qaida? I can never remember which group he is going to install in his cabinet to make us all slaves of  (take your pick) communism, socialism (yes, there is a difference), Sharia Law, etc.  I'd better ask Rush(ian) Limbaugh which one it is since HE seems to know exactly how fast we are all going to hell in a handbasket.
Nov 8, 2012 1:26PM
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strangely, as governor of Massachusetts, Mitt Romney was a VERY TOUGH anti-gun governor, who banned semi automatic assualt rifles amongst other guns...
Nov 8, 2012 1:25PM
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Here's how the fascists & communists do it.  First collapse the government with some kind of economic catastrophe.  Second, since demonstrations are disruptive to the economy, civil rights, Tea Party, OWS protestors, & of course, striking workers must be suppressed.  The government's wrecked, so the boss calls out the militia.

The more politically reliable units are made part of the new army.  Since there's been violence, the militias must be disarmed, naturally.  That's when they take away your guns.

It's when the economy has been wrecked by a small group of people, who then demand a bailout in order to finish off the government, when you have to worry.

Nov 8, 2012 1:24PM
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We have the worlds largest armed standing army.  You take that away and it will be a very bad deal,  who's going to save you when you see parachutes in the sky... 
Nov 8, 2012 1:24PM
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Obama and his Lefty cohorts have been trying to outlaw guns since the 60's.  So far, they haven't been successful. . Obama is the perfect model for a militarist society.  It worked in Germany and based on the fervor for Obama, it could happen here.  Keep an eye on him and his buddies.  Their goal is to get us into the One World Order, taking away our resources, and redistributing them into third world nations, with one world leader, one world banking system, and all of us subservient to their will.
Nov 8, 2012 1:24PM
Nov 8, 2012 1:24PM
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This I understand about gun sales increasing. He and the Clintons have no idea about what will

happen when Oboma attempts again to attack American gun rights. It is just amatter of time as

to when this will happen. So, all you that voted for him, you will pay the price in taxes as well

items such as this.

Nov 8, 2012 1:24PM
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I noticed within an hour of market open yesterday......

Smith/Wesson was heavy and hot as hell.

I absolutely agree with "kneejerk reaction...none of the indicators justify the jump in price.

 

Nov 8, 2012 1:23PM
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keeping you ignorant and paranoid...

Nov 8, 2012 1:23PM
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The same paranoia as the first election, and what did Obama do? allowed guns in National Parks.
Nov 8, 2012 1:23PM
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The solution to this problem is...Deal with the criminals who commit crimes with guns in a swift and just manner! Hey, Law Makers! STOP TREATING CRIMINALS LIKE BABIES! Why in the he!! can't you understand that all this crime BS is your fault! If you would stop being so concerned about hurting the criminals feelings and being more concerned about the victim and their families, crime would stop in this country! Go back to the electric chair for violent crimes with guns, public hangings for other violent crimes, and hard labor in prisons for all other crimes! Gees, you people are idiots!
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Banning guns will not ban criminals. Guns are only dangerious in the hands of those who don't know how to handle them or those who intend to use them to kill.If you change the heart of the person to a heart of love and compassion,then you have control of guns,baseball bats,knives,hands,cars and everything else used for killing.And if you let Him, God can change the heart.

 

Nov 8, 2012 1:22PM
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Ahhhh, and the idiots rush to buy guns and ammo. I own guns but don't run like a scared animal to the nearest gun store. I just hate that this kind of paranoia raises the costs of ammo.
Nov 8, 2012 1:21PM
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 This is completely idiotic .  Maybe White men are planning a terrorist plot or secede form the union( again). 
Nov 8, 2012 1:20PM
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There really is not a more useless sentence than the "Life without Possibility of Parole" one is.  If they can never walk amongst society anymore and they have killed someone or killed more than one, Does it make sense for a society to keep them pinned up in a small cell, feed them each day and take care of all of their needs?  If you are no longer part of society, why should such society pay to keep you alive?
Nov 8, 2012 1:19PM
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A few things to remember when talking about guns.

 

1) The state of Vermont (obviously a hotbed of gun violence and insurrection and the home of Howard Dean) has very few limitations on firearms ownwerhip and does not have an eceptionally high amount of crime involving firearms. By the way the people of Vermont are no crazier than the folks in Massachusetts (next door) where buying anything firearms related is a pain in the ****.

2) It is still possible to purchase a firearm (long gun)  at a New York gun show since they now do NICS checks on the spot.  Purchasing a pistol is more involved.

3) New Jersey has very strict laws on firearms (and I believe no gun shows)  and people are still bing shot in Newark, Patterson and from one end of the New Jersy Turnpike to the other.

4) For all you yokels out there who are on the holy anti-gun crusade, ownership of full automatics have been severly limited for several decades. Other than police they are mostly owned by well to do collectors because they are very expensive.

5) Most of the persons who want to limit firearms ownership do not know what they are talking about.

6) The NRA still has it's uses and is not always wrong but they are way too shrill and often seem to be an organization of firearms manufacturers and gun dealers. They use way to much hysteria and not enough thought.  Wayne La Pierre, get a grip on yourself!

Nov 8, 2012 1:18PM
Nov 8, 2012 1:15PM
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Once again paranoia rears it's head. Hmmm I wonder who is pushing this idea of Obama pushing for tighter gun control? Let's see now who would benefit the most from creating this false scenerio?
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