Stocks of gun companies and
makers of body cameras surged Friday following the deaths of five police
officers in Dallas and the killings of two black men -- Alton Sterling and
Philando Castile -- by police in Baton Rouge and Falcon Heights, Minnesota
earlier this week.
Gun makers Smith &
Wesson (SWHC) and Sturm Ruger (RGR) both rose more than 3% in early trading
Friday.
The two companies have
rallied all week after the latest data from the FBI showed a big increase in
background checks for guns in June -- a month when 49 people were killed at the
Pulse nightclub in Orlando and "Voice" singer Christina Grimmie was
shot dead, also in Orlando.
Both stocks often move
higher following mass shootings. The rationale is that people rush to buy guns
for their own personal protection ... but also due to fears that high-profile
massacres will eventually lead to stricter gun control laws.
Gun sales have boomed
lately, so much so that shares of Smith & Wesson and Sturm Ruger have
outperformed tech giants Apple (AAPL, Tech30) and Google (GOOGL, Tech30) over
the past five years.
But stun gun maker Taser --
which also makes the Axon line of body cameras used by many large police
departments nationwide -- and Digital Ally, another body camera manufacturer,
both surged on Friday as well.
With more and more
police-involved shootings of black men making headlines in the past few years,
investors are clearly betting that law enforcement agencies will want to invest
more in body cameras so they can record any police interactions with civilians
to be used as evidence.
It's also become
increasingly important to equip police officers with cameras now that more
incidents are being filmed by witnesses (and in some cases, victims) on their
cell phones -- and often broadcast live on Facebook (FB, Tech30) and Twitter
(TWTR, Tech30).
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