Trump Rally Attack Buoys Crypto and Gun Stocks

Crypto stocks, prison operators and other shares benefiting from a potential Trump presidency surged after an assassination attempt at a Trump rally. TMTG stocks soared 46%, with other sectors like cryptocurrency and gun makers also seeing gains. Clean energy stocks slipped due to Trump's stance on climate policies.

Crypto stocks, prison operators, and other shares potentially benefiting from a Donald Trump presidency surged premarket on Monday following an assassination attempt on the Republican candidate, which has boosted his odds in the U.S. elections. Investors expect increased betting on Trump's victory after he was shot in the ear during a rally in Pennsylvania. The former president showed resilience, pumping his fist moments after the attack.

Shares of Trump Media & Technology Group (TMTG) soared by 46%. Trump owns a majority stake in the company, recently valued at approximately $3.8 billion. TMTG, parent of social media platform Truth Social, has seen its stock rise 75% this year, driven by retail traders supporting a Trump victory in the November 5 rematch against Democratic candidate Joe Biden.

Crypto stocks also saw gains, with bitcoin reaching a two-week high. Companies such as Coinbase Global, Riot Platforms Inc, and Marathon Digital increased between 5% and 7% as Trump presents himself as a cryptocurrency advocate. According to Rick Meckler of Cherry Lane Investments, investors' confidence in a Trump victory is becoming more evident in specific sectors, although the overall market impact remains muted. Futures tied to the S&P 500 edged 0.5% higher.

Gun makers and ammunition stocks, like Smith & Wesson Brands and Sturm Ruger & Co, jumped between 5% and 6.7%. Gun stocks typically rise after mass shootings amid public fears of potential gun control legislation. Prison stocks Geo Group and CoreCivic also rose, gaining 6.8% and 7.8% respectively, as a Trump presidency could increase detention center demand.

Software developer Phunware, involved in Trump's 2020 re-election campaign, saw a 30% rise, while conservative-favored video-sharing platform Rumble added 9%. Conversely, clean energy stocks fell, with the Invesco Solar ETF dropping 4.3% and the iShares Global Clean Energy ETF falling 3%, reflecting concerns over Trump's promise to roll back Biden's climate policies. Reuters/Ipsos polls suggest that U.S. voters view Trump as a better candidate for the economy, despite a solid economic performance under Biden, characterized by slowing inflation and low unemployment.

Isaac Boltansky of BTIG believes any increase in Trump's approval post-attack may dissipate but recognizes Trump's defiance after the attack could be pivotal this election cycle.

(With inputs from agencies.)