Las Vegas Shooting Analysis
Autor: Mikki • November 22, 2018 • 1,044 Words (5 Pages) • 491 Views
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Fig 1. Stock price of RGR with respect to gun violence incidents in US
Looking from a financial context, expecting tougher regulations on buying semi-automatic and automatic guns, stocks of gun companies rose immediately after this incident (Fig 1.). Shares of Sturm Ruger were up 4%, while American Outdoor Brands, the company formerly known as Smith & Wesson, gained more than 3%. A company named Olin, which owns the Winchester brand of ammunition, rose 6% to an all-time high. The gun stocks had a cascading effect on the sports good industry as well because of high correlation between these two industries. However, shares of Las Vegas casino operators fell by 5% owing to the fear this incident created leading to potential losses (Source: Reuters). The effect of this has been similar to the 2008 financial crisis which made the financial institutions susceptible to lack of trust. Mostly, these are temporary shocks and the market is expected to sail through the turbulence. At the same time, it is important to point out that the small businesses in the affected industry have to absorb more losses and that can be lethal for them. The large corporations are bailed out or saved by their deep pockets making their existence a little bit more easy.
In conclusion, use of data analytics and communiation mediums have made it easy to measure the market sentiments and quantify the turbulence caused by the Las Vegas incident. It should be noted that, in modern times it can be said that when United States sneezez, the rest of the world catches cold. Therefore any disruption in the US markets will have a temporary effect in the other geographical markets as well. As business leaders, corporations should identify the source of the turbulence and plan their strategy accordinngly. In case of Las Vegas, the casino lobby blamed the gun laws to protect themselves against the ire of the people. Sadly, shifting the blame has always been the go to strategy for big corporates in tragedies like these.
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