What Happened?

A number of stocks jumped in the afternoon session after President Trump reversed course on a military escalation against Iran that wiped $1.2 trillion from the market earlier in the day. 

The session opened under heavy pressure after Trump posted on Truth Social that the U.S. would attack Iran "VERY HARD TONIGHT" and threatened to seize the country's oil assets. Then, around midday, he posted again cancelling the planned strikes. His statement said discussions had been brought to "the highest level of Iranian leadership" and that final points of a peace deal had been "approved by all parties involved," citing thirteen countries including the U.S., Israel, Saudi Arabia, UAE, and Qatar. A signing date would be "announced shortly."

The market moved the moment the post landed. The S&P 500 jumped 1.4%, the Dow surged, and the Nasdaq gained 1.8%. Oil fell more than 3%. The 10-year Treasury yield eased from 4.55% to 4.47%. The read-through is simple: lower oil means lower inflation means less pressure on the Fed to hike. Iran's disruption of the Strait of Hormuz was the single largest driver of the 4.2% annual inflation print reported earlier in the week as energy alone accounted for more than 60% of May's monthly CPI increase. A ceasefire that reopens the Strait unwinds that pressure immediately, potentially taking the December rate hike that markets were fully pricing in off the table.

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 Abercrombie and Fitch (NYSE: ANF) jumped 5.4%. Is now the time to buy Abercrombie and Fitch? Access our full analysis report here, it’s free.
• Apparel Retailer company Urban Outfitters (NASDAQ: URBN) jumped 5.2%. Is now the time to buy Urban Outfitters? Access our full analysis report here, it’s free.

Zooming In On Abercrombie and Fitch (ANF)

Abercrombie and Fitch’s shares are very volatile and have had 27 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 previous big move we wrote about was 22 days ago when the stock gained 3.5% on the news that a trio of major retailers reported stronger-than-expected first-quarter earnings. 

The synchronized beat from companies including Target, Lowe's, and TJX signaled a potential turn in consumer discretionary momentum, triggering a sector rotation back into U.S. retail stocks. The results suggest American household spending remains more resilient than analysts had feared at the start of the quarter. Target, for example, saw a 6.7% increase in net sales, reversing several quarters of decline, with store traffic up 4.4%. These positive reports, particularly from discount-oriented retailers, indicate that while consumers may be navigating inflation, they are still spending, especially when focused on value.

Abercrombie and Fitch is down 27.3% since the beginning of the year, and at $89.95 per share, it is trading 30.7% below its 52-week high of $129.85 from January 2026. Despite the year-to-date decline, investors who bought $1,000 worth of Abercrombie and Fitch’s shares 5 years ago would now be looking at an investment worth $2,087.

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