What Happened?
A number of stocks jumped in the morning session after oil fell more than 5%, as the Trump administration announced a new peace deal that would lead to the reopening of the Strait of Hormuz.
Most clothing sold in the United States is manufactured in Asia from petroleum-derived synthetic fabrics (polyester, nylon, and elastane) and transported by container ships that burn bunker fuel. When oil spiked after the Hormuz blockade began, both input costs and ocean freight rates rose, compressing margins at almost every step.
With Brent crude falling toward $83 from a May peak above $126, those pressures reverse. Retailers sourcing autumn and winter inventory are in the middle of purchasing commitments right now, so lower logistics and raw material costs at this point in the procurement cycle have direct implications for the margins they will report in the second half of the year.
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:
- Consumer Discretionary - Apparel and Accessories company VF Corp (NYSE: VFC) jumped 3.4%. Is now the time to buy VF Corp? Access our full analysis report here, it’s free.
- Consumer Discretionary - Apparel and Accessories company PVH (NYSE: PVH) jumped 3.3%. Is now the time to buy PVH? Access our full analysis report here, it’s free.
Zooming In On VF Corp (VFC)
VF Corp’s shares are very volatile and have had 28 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 6 days ago when the stock gained 3% on the news that strong retail sales data for May revealed that consumer spending was robust despite inflation and high gas prices.
According to the CNBC/NRF Retail Monitor, sales, excluding autos and gas, rose 0.42% from the previous month and a significant 7.19% year-over-year. This marks the eighth consecutive month of growth. NRF President and CEO Matthew Shay noted that the momentum was driven by a "resilient labor market and consumers' continued willingness to spend." This positive trend was further bolstered by the U.S. Red Book report, which showed sales rising to a 9.1% annual rate through the first week of June. These figures suggest that consumer health is holding up, providing a positive outlook for retailers.
VF Corp is flat since the beginning of the year, and at $18.05 per share, it is trading 16.3% below its 52-week high of $21.55 from April 2026. Investors who bought $1,000 worth of VF Corp’s shares 5 years ago would now be looking at only $220.14.
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