(NEXSTAR) – After getting a boost in the run-up to a U.S. presidential election so anxiety-provoking that a “disorder” was coined, gun stocks tumbled Monday amid positive vaccine news and a lack of widespread unrest.
Smith & Wesson Brands fell more than 9%, Sturm Ruger & Co. finished down over 7% and Vista Outdoor dropped more than 13%. Vista Outdoor sells ammunition and other sporting goods.
All three stocks rose in the lead-up to Election Day as the nation braced for the outcome and investors imagined a Biden administration crackdown on weapons that might send consumers flocking to gun stores.
Business owners boarded up windows ahead of Election Day, researchers ranked cities most likely to see militia-linked violence and the White House even installed an anti-scaling fence – but the projected chaos failed to materialize.
Now, with a Senate hanging in the balance and Democratic losses in the House, it appears less likely the former vice president will be able to take office and pass sweeping gun control legislation, according to Reuters.
On Monday, Pfizer also announced that a vaccine shot to prevent COVID-19 may be 90% effective, allowing investors to imagine the country getting back to a pre-pandemic way of life.
“If a vaccine that is 90% effective can truly bring COVID to an end, the return to work and school could subsequently bring sales in these categories back down to normalized levels,” Aegis Capital analyst Rommel Dionisio told Reuters in an email, referring to sporting goods- and hunting-related companies.
Dionisio added that stock prices could surge in the future if consumers start to worry that new restrictions that might prevent them from buying weapons.