Firearm makers' shares rise after Orlando mass shooting

Newly assembled rifles are placed on a stand in a weapons factory in Uhersky Brod, Czech Republic, on May 27, 2016.
Newly assembled rifles are placed on a stand in a weapons factory in Uhersky Brod, Czech Republic, on May 27, 2016. PHOTO: REUTERS

(Reuters) - Shares of firearm makers rose in premarket trading on Monday (June 13), after the deadliest mass shooting in US history sparked renewed fears of potential gun control.

Smith & Wesson Holding Corp shares were up 8.8 per cent at US$23.30, while those of Sturm, Ruger & Co Inc rose 4.5 per cent at US$60.

A man armed with an assault rifle and pledging loyalty to Islamic State killed 49 people during a gay pride celebration at a nightclub in Orlando, Florida early on Sunday before being killed by police.

The rampage - carried out by Omar Mateen, a New York-born Florida resident and US citizen - was denounced by President Barack Obama, who had previously blasted congressional inaction on gun control.

Gun sales jumped in January after President Obama vowed to use executive powers to expand background checks for buyers and bolster licensing requirements for dealers.

The announcement had followed the mass shooting in San Bernardino, California, where a couple pledging allegiance to Islamic State killed 14 people.

Gun sales slowed in May according to adjusted data from National Instant Criminal Background Check System (NICS), which process applications to own firearms.

Sales were up only modestly from a year earlier, compared with expectations for a double-digit rise, BB&T Capital markets analyst Brian Ruttenbur wrote last week.

Ruttenbur had also cut his rating on Sturm, Ruger to "hold"from "buy".

Up to Friday's close, Smith & Wesson stock had risen 39 per cent in last 12 months, while Sturm, Ruger had risen about 6 per cent.