What Happened?

A number of stocks fell in the afternoon session after concerns arose that a widening conflict in the Middle East could harm the global economy and dampen consumer spending, as Trump warned the crisis might persist for up to a month. 

A worldwide stock sell-off hit Wall Street, with the Dow Jones Industrial Average falling over 1,000 points. The consumer discretionary sector was particularly hard-hit, dropping over 3%. Investors are increasingly worried that the conflict could lead to a sustained rise in oil and energy prices, fueling inflation. This comes as many households are already navigating elevated prices and economic uncertainty. Higher costs for essentials could further squeeze budgets, potentially weakening demand for non-essential goods and services, which directly impacts companies in the consumer discretionary space. The conflict threatens to disrupt supply chains and increase freight costs, adding further pressure on these businesses.

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:

• Home Furniture Retailer company Sleep Number (NASDAQ: SNBR) fell 8.4%. Is now the time to buy Sleep Number? Access our full analysis report here, it’s free.
• Specialty Retail company Petco (NASDAQ: WOOF) fell 5.1%. Is now the time to buy Petco? Access our full analysis report here, it’s free.
• Beauty and Cosmetics Retailer company Sally Beauty (NYSE: SBH) fell 5.9%. Is now the time to buy Sally Beauty? Access our full analysis report here, it’s free.

Zooming In On Sleep Number (SNBR)

Sleep Number’s shares are extremely volatile and have had 93 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 11 days ago when the stock gained 12.8% on the news that reports revealed that its Minneapolis headquarters building sold for $235 million, a price significantly higher than its assessed value. The sale price was reportedly more than eight times the property's assessed value. This eye-popping amount was driven by the fact that the building housed a growing data center built for artificial intelligence and cloud-computing companies. While Sleep Number continued to operate in a different part of the space, the transaction unlocked substantial value from its real estate holdings, providing a significant financial gain for the company.

Sleep Number is down 37.1% since the beginning of the year, and at $5.40 per share, it is trading 58.1% below its 52-week high of $12.89 from March 2025. Investors who bought $1,000 worth of Sleep Number’s shares 5 years ago would now be looking at an investment worth $38.20.

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