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:
- Boat & Marine Retailer company OneWater (NASDAQ: ONEW) jumped 4%. Is now the time to buy OneWater? Access our full analysis report here, it’s free.
- Vehicle Retailer company CarMax (NYSE: KMX) jumped 4.3%. Is now the time to buy CarMax? Access our full analysis report here, it’s free.
- Department Store company Dillard's (NYSE: DDS) jumped 4.3%. Is now the time to buy Dillard's? Access our full analysis report here, it’s free.
Zooming In On Dillard's (DDS)
Dillard’s shares are quite volatile and have had 15 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 7 months ago when the stock gained 16% on the news that it reported stronger-than-expected third-quarter financial results, beating both sales and profit forecasts.
The department store operator announced earnings per share of $8.31, easily surpassing analyst estimates of $6.17. Quarterly sales grew 2.7% year on year to $1.49 billion, which also beat Wall Street's expectations. The company also noted that comparable store sales increased by 3%. Furthermore, Dillard's operating margin improved significantly, rising to 14.7% from 11.3% in the same period a year earlier, highlighting greater efficiency. The positive results signaled solid momentum for the retailer ahead of the holiday shopping season.
Dillard's is down 3.7% since the beginning of the year, and at $613.23 per share, it is trading 16.1% below its 52-week high of $730.73 from December 2025. Despite the year-to-date decline, investors who bought $1,000 worth of Dillard’s shares 5 years ago would now be looking at an investment worth $3,629.
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