After first soaring, then finally pulling back in late-week trading last week, shares of Smith & Wesson Brands (NASDAQ: SWBI) are rebounding on Monday. After rising by nearly 10% earlier in the session, they eased back, but were still up by 4.3% as of 1:30 p.m. EST.
There doesn’t appear to be any particular catalyst behind Monday’s move higher. Nevertheless, stocks across the sector — Sturm Ruger, Vista Outdoor, and Ammo Inc. — were also all up modestly. One possible reason is that investors have reassessed the chances of new gun legislation passing through a Democrat-controlled Congress and White House, and thinking that it’s not so great as it at first appeared.
Or investors may be thinking that the chances of tighter gun laws passing are as great as they appear … and that the perceived risk of that will boost gun sales in the near term.