MW Retail and travel stocks rally after Iran cease-fire - but it could take months for consumers to see lower prices

By Bill Peters

Carnival's stock was among the S&P 500's best performers as Iran cease-fire provides relief from surging fuel costs. Home Depot, Amazon and other retailers were also up

A view of the Carnival Panorama cruise ship in the Pacific Ocean off Los Cabos, Baja California, Mexico, on July 15, 2025.

The cease-fire agreement between the U.S. and Iran triggered a relief rally in shares of cruise operators, as well as in those of other consumer-facing companies, on hopes that a sharp drop in crude oil prices would help lower operating costs, and calm anxious consumers.

Carnival's stock $(CCL)$ shot up 11.2%, the biggest one-day gain since April 9, 2025, to close as the S&P 500 index's SPX third-biggest gainer. The company said in late March that it had cut its full-year profit outlook as a jump in fuel costs offset record cruise demand. The stock tumbled 18% that month after the Iran conflict started.

Mizuho analyst Ben Chaiken wrote in a note to clients that oil prices would likely dictate investor sentiment around the cruise industry, and said travel from North America to Europe remained a risk. But he said Carnival had "almost zero exposure" to that risk.

"Despite a precarious geopolitical environment, we are constructive on the cruise industry, in part due to compressed valuations that in our view fully encompass the recent move in oil as well as some potential isolated demand impacts," he said.

Not too far behind on the S&P 500's winners list were shares of Norwegian Cruise Line Holdings $(NCLH)$, which surged 9.1%, while Royal Caribbean's stock $(RCL)$ rallied 4.3%. And among other travel-related companies, United Airlines Holdings shares $(UAL)$ rose 7.9% and Delta Air Lines's stock closed up 3.8%.

Fuel is generally among the biggest costs for cruise-ship operators and airlines.

Crude-oil futures (CL00) (CL.1) dove 14.8% in recent trading, and were headed for their biggest selloff in six years.

Still, it could be months before consumers see lower prices at gas stations, grocery stores and elsewhere - if at all - as those lower costs tend to just trickle through businesses' operations.

"The retail price is most like a cargo ship. It's not a speedboat," said Nick Vyas, a supply-chain expert and a business professor at the University of Southern California.

As for retail names, the State Street Consumer Discretionary Select Sector SPDR ETF XLY - whose holdings include the cruise operators, as well as retailers and restaurants like Amazon.com (AMZN), Home Depot $(HD)$, McDonald's $(MCD)$ and Starbucks $(SBUX)$ - climbed 2.8%.

The ETF had dropped 6.7% in March after the Iran conflict started, amid fears that rising gasoline prices would make consumers think twice about spending on discretionary items, or things they want, as opposed to things they need.

Among individual retailers, Home Depot's stock jumped 5.5% toward its biggest increase in a year. Amazon's stock added 3.5% and Walmart shares gained 3.9%.

Vyas said the cease-fire deal came as retailers prepare for holiday-season orders. But he said that the retailers he's spoken with were waiting for more clarity on the state of the conflict before they made big decisions on shipping. Barring any additional fighting or policy turmoil, he estimated that it could take at least six to nine months before prices leveled off.

Besides, despite Wednesday's selloff, crude oil futures were still trading 44% above where they ended on Feb. 27 according to FactSet data, which was the day before the Iran conflict started.

The war and the two-week cease-fire represent the latest convulsion to the world's supply chains this decade that have driven up prices, following the pandemic, port backups, the war in Ukraine and tariffs. Over the past few years, some economists suspected that companies kept their prices elevated after those supply shocks, even as costs eased.

Also read: These stocks in the S&P 500 are rising the most after Trump's cease-fire announcement

The deal, announced late Tuesday, followed increasingly dire threats from Trump if Iran could not agree to a deal and reopen the Strait of Hormuz, a major shipping lane for oil. Yet Vice President JD Vance called the deal "fragile," and the contours of any longer-term agreement were also unclear as fighting reportedly continued in the region Wednesday, according to the AP.

Since the Iran war began on Feb. 28, average U.S. gas prices have risen above $4 a gallon, putting further strain on consumers grappling with several years of cost-of-living increases. But larger retailers have downplayed the threat of higher gas prices, at least for now. Consumers, when they have spent, have tried to make it count, and some executives have said travel has remained a priority.

On Wednesday, Delta said travel demand remains strong, noting that higher fares, surcharges and its own oil refinery helped to offset rising fuel costs. The airline's efforts to offer more premium seating classes to draw wealthier consumers hasn't hurt either. However, steeper fuel costs could lead airlines to cut flights from their schedules, and carriers have also recently raised fees on checked bags.

Elsewhere, Nike $(NKE)$ last week said it hadn't yet seen an impact from higher gas prices, at least in North America. And Levi Strauss $(LEVI)$ said late Tuesday that it remained "thoughtful about the external environment," but expressed confidence in demand for its new denim gear in the months ahead.

Last month, Levi's said the Middle East represented less than 1% of its total business, and that the amount of product it got via the Strait of Hormuz was "very, very minor."

Still, Jefferies analyst Aniket Shah wrote in a research note that oil prices would likely stay above prewar levels for months, even as market worries eased.

"With post-cease-fire paths ranging from a narrow diplomatic off-ramp to a frozen conflict or renewed fighting, markets appear to be pricing beyond worst-case outcomes," he said.

-Bill Peters

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April 08, 2026 16:22 ET (20:22 GMT)

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