What Happened?
A number of stocks fell in the afternoon session after geopolitical uncertainty and a sharp rise in oil prices weighed on broader market sentiment.
The S&P 500 dropped by 1%, with the Dow and Nasdaq also seeing declines as conflict in Iran intensified. Tensions around the crucial Strait of Hormuz, a key channel for a fifth of the world's oil supply, pushed global energy prices higher. A barrel of Brent crude oil surged 4.9% to $101.98, a significant increase from its pre-war level of around $70. Rising energy costs can impact consumer spending by reducing disposable income, which often leads to concerns for companies in the retail, travel, and leisure industries.
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 - Leisure Facilities company Dave & Buster's (NASDAQ: PLAY) fell 11.9%. Is now the time to buy Dave & Buster's? Access our full analysis report here, it’s free.
- Consumer Discretionary - Footwear company Deckers (NYSE: DECK) fell 6%. Is now the time to buy Deckers? Access our full analysis report here, it’s free.
- Consumer Discretionary - Leisure Products company Ruger (NYSE: RGR) fell 3.9%. Is now the time to buy Ruger? Access our full analysis report here, it’s free.
- Consumer Discretionary - Leisure Facilities company Sphere Entertainment (NYSE: SPHR) fell 4.1%. Is now the time to buy Sphere Entertainment? Access our full analysis report here, it’s free.
Zooming In On Dave & Buster's (PLAY)
Dave & Buster’s shares are extremely volatile and have had 53 moves greater than 5% over the last year. But moves this big are rare even for Dave & Buster's and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 17 days ago when the stock dropped 5.8% on the news that a broader market sell-off was triggered by a sharp rise in oil prices amid escalating geopolitical tensions in the Middle East.
The decline came as part of a wider market downturn affecting all major indexes. Oil prices surged, with U.S. benchmarks briefly touching nearly $120 a barrel, the highest since 2022, as a conflict in the Middle East intensified. This spike in energy costs raised concerns about a potential global economic slowdown and its impact on consumer spending. Consequently, sectors sensitive to consumer sentiment, like the Consumer Discretionary sector which includes Dave & Buster's, experienced significant drops. The negative sentiment was widespread, with futures for the S&P 500, Nasdaq, and Dow Jones all falling more than 1% before the market opened.
Dave & Buster's is down 36.1% since the beginning of the year, and at $10.89 per share, it is trading 68.5% below its 52-week high of $34.55 from July 2025. Investors who bought $1,000 worth of Dave & Buster’s shares 5 years ago would now be looking at only $221.71.
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