As the new year began, President Barack Obama took executive action to put stronger gun-control laws and regulations into place. With stricter background checks and more spending on enforcement, it's clear that these laws could make gun ownership a more difficult process. So why, then, is the gun market surging in the face of one of the worst opening days in history for the Dow?

In this clip, Sean O'Reilly and Vincent Shen explain how gun producers like Smith & Wesson Holding (SWBI -1.02%) and Sturm, Ruger & Co (RGR -0.41%) bucked the down trend, and when we've seen this happen before.

Listen to the full podcast by clicking here. A full transcript follows the video.

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This podcast was recorded on Jan 5, 2016.

Sean O'Reilly: Well, long story short, and if our listeners may or may not be aware, President Obama is currently in the process of signing an executive action for basically stricter gun-control laws. It's kind of a, we're not going to get into politics here. That's not our thing, but it's happening. Surprising though, it's been kind of good for the gun industry.

Vincent Shen: Yeah exactly. Yesterday's trading, the market kind of greeted 2016 with a little bit of a chilly reception. The Dow was down 276 points, 1.6%. S&P shed similar, about 1.5%. One of the worst opening days for the market in history. One of the worst.

O'Reilly: It's kind of set off by a week of kind of amazing China. They have, like, a 7% sell-off over there.

Shen: Yeah, and it could have been worse, too, if it hadn't ... they implemented ...

O'Reilly: They have circuit breakers. We don't.

Shen: ... new circuit breakers. They kind of do what a lot of the American exchanges have now, where if the sell-off gets tripped by a certain amount, they'll halt the trading, which is exactly what happened yesterday. Then you combine a lot of that uncertainty around China, manufacturing, the implications around that, the implications all over the world, plus some new tensions in the Middle East with a lot of countries stepping away from Iran, and that basically combined for a very, I guess bearish view -- at least for yesterday. That seems to have continued into today, like you mentioned.

O'Reilly: Well yeah, they're up again. The standouts yesterday amid the sell-off were all these gun manufacturers.

Shen: Exactly. Specifically...

O'Reilly: There aren't many.

Shen: Yeah, there aren't many options here in the sector depending on if you're looking for a pure-play gun manufacturer. There's, of course, people who make accessories, ammunition. If we're looking at Smith & Wesson holding company, they're up 6% yesterday. Then there's also Sturm Ruger, up 3% yesterday, and we can talk a little bit about Vista Outdoor (VSTO 0.64%). They're up 2%. They produce a lot of ammunition. Obviously still involved in that industry, and tied to it.

As you mentioned, why these companies bucked the trend. We had these executive orders coming down the pipeline that are supposed to be announced officially today. It's around background checks, more spending on enforcement, mental health. Things along those lines; but what that has signaled for a lot of gun buyers in this country is these new regulations. We might not be able to get certain guns that are available now, so buy them now. We should buy them now.

O'Reilly: Get them while you can.

Shen: Exactly.

O'Reilly: Supposedly. They're up even more today. This is going to keep, this is very impressive.

Shen: Yeah, they're up even more. Maybe because today is the official announcement. Smith & Wesson is again up 13% today.

O'Reilly: Wow.

Shen: Last I checked, Ruger is up 7%, and Vista Outdoor is up 5%. Not all that surprising considering what we've seen in the aftermath of certain political moves. Also, tragedies where people worry about what is going to be available. There's a huge surge in demand.