Trump’s plan to relax overseas gun sales rules sees US firearms firm shares surge

The plans will reportedly cover small arms, assault rifles and ammunition

(Reuters)

Shares in US gun companies surged on Tuesday on the back of reports that President Donald Trump is planning to relax rules on sales of American firearms around the world.

Four senior US officials told Reuters that the President intends to shift control of non-military weapons sales outside the US from the security-focused State Department to the trade-focused Commerce Department. The plans will reportedly cover small arms, assault rifles and ammunition. The news agency reported that the administration has all but finalised the new rules and a draft version could be sent to the White House budget office for review within days.

American Outdoor Brands, formerly known as Smith & Wesson, jumped as much as 18.5 per cent after the news broke, before falling back to close 10.1 per cent up at $15.70 (£11.61) on Tuesday.

Fellow gun maker, Sturm, Ruger & Co leaped as much as 18.5 per cent before finishing the day 13.7 per cent higher at $54.35 in New York. A busy day’s trading saw five times as many shares in the company traded than the average for the last 30 days, according to Reuters, and the most since the day after Mr Trump won the presidential election.

Shares in Vista Outdoor also rose on Tuesday, gaining more than 6 per cent and closing up 3.1 per cent at $23.00.

Gun manufacturers have seen sharp falls in their stock market valuations since Mr Trump won the presidential election in November. Demand for firearms has fallen off as people have become less concerned that gun ownership rights may be restricted.

In February, Mr Trump signed a bill rolling back regulations proposed during Barack Obama’s administration to prevent the sale of guns to people with certain mental disorders.

The planned legislation came as part of Mr Obama’s efforts to improve and strengthen background checks on the availability of firearms in the wake of the 2012 Sandy Hook school massacre in which 26 children and staff were murdered.

In the shooting, 20-year-old Adam Lanza, who suffered from several mental impairments including Asperger’s syndrome and obsessive compulsive disorder, shot his mother dead at home, and then went to the school where he fatally shot 20 students between six and seven years old, as well as six teachers. He then turned the gun on himself.