By Caroline Lovering
On October 1, 2017, Stephan Paddock opened fire on a crowded country music festival of 22,000 people. And in only 11 minutes Paddock had killed 58 and leftover 500 injured, in what would become to be known as the worst mass shooting in modern American history. The third time a shooting has had that classification in less than a decade.
Yet in the wake of this darkness, sales in gun manufactures shares swelled in the week following after what seemed to be a record low year. According to Tiffany Hsu of the New York Times, American Outdoor Brands, formerly known as Smith & Wesson, shares went up by almost 3.2% on Monday and 2.5% on Tuesday. While Sturm Ruger, a producer of a semi-automatic and single shot rifles, rose 3.5% on Monday and 2.4% on Tuesday. This was accompanied by a rise in Olin, the owner of Winchester ammunition, of 6% over those two days to an all-time high for the company.
Unfortunately, this trend is more than common following situations like Las Vegas. Following a mass shooting, traders buy up shares in gun companies in order to anticipate citizens stocking up on firearms to protect themselves and their families. In what some researchers call a “knee-jerk reaction,” this response is common among civilians. This forces in an influx in the prices of shares for many of the prospering gun producers.
Rommel Dionisio, a managing director at Aegis Capital, an institutional broker-dealer, was quoted telling CNBC that the gun industry was looking at “a two-to-three-month surge in firearm sales” after last year’s tragedy at Pulse Nightclub, where a shooter entered a gay nightclub wounding 58 people and leaving 49 dead. After this horrible event, the New York Times reported that shares in Sturm Ruger rose almost 9% and American Outdoor Brands rose almost 7% in the days following. He also explained that this increase was apparent after the shooting in San Bernardino, California in 2015, which left 14 dead and 22 seriously injured. After this tragedy handgun sales spiked over 62% in the month of December alone.
In a new study published by the Annals of Internal Medicine, handgun sales in California were tracked after the 2012 Newtown massacre. This study confirmed the increase in sales and reported 53% more purchases of handguns after the Sandy Hook disaster while also finding a larger jump in handgun purchases from people who had not previously owned a gun. Although this study did not directly ask buyers their reason for purchase, in 2013 the Pew Research Center conducted a study that reported that half of American gun owners claimed that protection was their main reason for owning a gun.
However, some sources believe that the increase in gun purchases after the San Bernardino shootings and Plus Nightclub shootings was partially due to President Obama’s response of promising to tighten gun laws. Citizens fears of stricter regulations and harder qualifications drove shoppers to buy more guns before that right was taken away from them. Therefore, a sales
bump is not necessarily guaranteed under the new administration due to their lesser gun regulations.