Gun stocks tumble, as election uncertainties sparked worries of reduced demand
Shares of gun makers tumbled Wednesday, as a failed Democratic election sweep assuaged concerns over potential tighter regulations, which could have sparked further demand for firearms. Smith & Wesson Brands Inc.'s stock plunged 1.7% and Sturm, Ruger & Co.'s stock dropped 10.5%. Shares of ammunition and shooting sports accessories maker Vista Outdoor Inc. was knocked down 4.6%. The selloff bucked the surge in the broader stock market, in which the Dow Jones Industrial Average jumped 643 points, or 2.3%, and the S&P 500 hiked up 3.0%. Gun stocks had rallied on Tuesday, amid growing expectations that Former Vice President Joe Biden would be elected president and Democrats would take over a majority of the Senate. Analysts say that concerns over tighter gun regulation tends to be the primary driver of demand for firearms. Meanwhile, gun stocks had been soaring since March, as worries about social unrest stemming from the COVID-19 pandemic and calls to defund the police also fueled demand.
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