What Happened?

A number of stocks jumped in the afternoon session after President Trump announced a two-week suspension of attacks on Iran, resulting in a 17% drop in crude oil prices. 

Consumer retail stocks gained as the drop in oil prices alleviates inflationary pressures on both the supply and demand sides. Retailers had been bracing for a period of high freight costs and cautious consumer spending, but the news shifted that narrative toward growth. The retail sector benefits from lower inbound shipping costs as fuel surcharges retreat. Furthermore, as more vessels pass through the Strait of Hormuz, the risk of inventory shortages for goods sourced from or through the region is significantly diminished. This "ceasefire dividend" allows retailers to maintain better margins while potentially passing savings to customers. 

Adding to the optimism, Delta's (DAL) record quarterly sales suggest that discretionary spending power remains intact despite recent geopolitical headwinds. When coupled with the 17% plunge in oil prices, this trend signals a turning point for consumer confidence and a cooling of the inflationary pressures that have recently weighed on the retail sector.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Apparel Retailer company Victoria's Secret (NYSE: VSCO) jumped 5.7%. Is now the time to buy Victoria's Secret? Access our full analysis report here, it’s free.
• Home Improvement Retailer company Lowe's (NYSE: LOW) jumped 5.1%. Is now the time to buy Lowe's? Access our full analysis report here, it’s free.

Zooming In On Victoria's Secret (VSCO)

Victoria's Secret’s shares are extremely volatile and have had 37 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 12 months ago when the stock dropped 13.3% on the news that stocks gave back some of the gains from the previous day as the White House clarified the tariffs on imports from China would add up to 145%, while the baseline 10% tariffs remained in place for all countries. 

This reminded markets that the global trade environment remained volatile, limiting the potential for sustained gains. Also, President Trump said he was willing to accept pain in the short term, and was aware his policies could cause a recession, but he remained more mindful of a more severe case of economic depression (higher unemployment and prolonged downturn). For investors, this suggested that the administration could prioritize long-term structural shifts over near-term economic stability, further increasing policy-driven risk in the markets.

Victoria's Secret is down 3% since the beginning of the year, and at $51.73 per share, it is trading 21.5% below its 52-week high of $65.90 from January 2026. Investors who bought $1,000 worth of Victoria's Secret’s shares at the IPO in July 2021 would now be looking at an investment worth $1,217.

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