By Tomi Kilgore, MarketWatch
Shares of Digital Ally Inc. and Cemtrex Inc. powered to near one-year highs on heavy volume Monday, as the nationwide protests against police killings fueled investor interest in the security products makers.
The social unrest and looting in some cities also provided a boost to the stocks of guns and ammunition makers.
Cemtrex’s stock /zigman2/quotes/203363170/composite CETX -5.34% nearly tripled, rocketing 172.4%, to close above the $1 mark for the first time in three months, and the highest close since June 28, 2019. Trading volume spiked up to 196.9 million shares, enough to make it the most actively traded stock on the Nasdaq exchange, and multiples of the full-day average of about 915,000 shares.
The company’s Vicon business makes security cameras used by law enforcement for surveillance.
Digital Ally’s stock /zigman2/quotes/207505408/composite DGLY 0.00% nearly doubled, vaulting 75.9%, to the highest close since June 17, 2019. Volume ballooned to 92.0 million shares, the third-most on the Nasdaq, and compared with the full-day average of about 658,000 shares.
The company makes body-worn and in-car video systems , which are sold to law enforcement agencies and private security customers.
The stocks ranked first and second on the list of the Nasdaq’s biggest percentage gainers.
Elsewhere, shares of Vislink Technologies Inc. /zigman2/quotes/210078876/composite VISL -5.56% soared 22.6% to the highest close since Jan. 28. About 94 million shares changed hands, above the full-day average of about 33.5 million shares. The stock was the second-most active on the Nasdaq.
The company makes communications equipment, such as receiver and antenna systems that provide video and data transmission, which are used by state, local and federal law enforcement agencies and branches of armed forces.
The rallies came amid relatively mild gains in the broader stock market, with the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +1.29% tacking on 91.91 points, or 0.4%, and the S&P 500 index /zigman2/quotes/210599714/realtime SPX +1.22% edging up 0.4%.
The interest in these security stocks follows a weekend in which protests continued across the country, some turning violent, following the killing of George Floyd, a black man, by a white police officer in Minneapolis.
Floyd’s death comes less than a month after two white men were arrested in May, for the shooting death in February of Ahmaud Arbery, a black man who was jogging in a park in Georgia, and the police shooting of Breonna Taylor, a black woman, in her home in Louisville.
With the protests turning violent in some instances, as fires were started and stores were looted, electrical weapons, firearm and ammunition stocks also got a big boost Monday.
Shares of Smith & Wesson Brands Inc. /zigman2/quotes/202273249/composite SWBI +2.49% ran up 15.1% to an 18-month closing high. The gun maker changed its name from American Outdoor Brands Corp., and its ticker symbol to “SWBI” from “AOBC,” effective Monday.
Trading volume was 2..9 million shares, compared with the full-day average of about 820,000 shares.
Sturm, Ruger & Co. Inc.’s stock /zigman2/quotes/200036418/composite RGR +3.05% hiked up 9.4% on volume of 1.5 million shares, which was almost 5-times the full-day average. That put the stock closed at the highest level since Sept. 28, 2018.
Sturm, Ruger makes handguns, assault-style and single-shot rifles , magazines and loaders and silencers.
Gun stocks had already been rallying in recent months, as the COVID-19 pandemic appeared to spark demand for firearms. As KeyBanc Capital analyst Brett Andress pointed out last month, a jump in demand for firearms was a result of “fear-based purchases amid social unrest” caused by the pandemic.
The stock of Axon Enterprise Inc., which changed its name from Taser International Inc. in April 2017, rallied 18.2% to a record close. Volume was just shy of 5 million shares, or more than 6-times the full-day average.
The company makes electrical weapons and body cameras used by law enforcement.
Shares of Vista Outdoor Inc. /zigman2/quotes/205852373/composite VSTO +2.77% , which makes shooting sports and outdoor products , including ammunition, scopes and CamelBak water drinking products, jumped 9.8% on volume of about 5 million shares, which was close to 4-times the full-day average.
The stock closed at the highest price since Jan. 25, 2019.