What Happened?
A number of stocks jumped in the afternoon session after software stocks benefited from a "risk-on" market sentiment fueled by potential peace negotiations between the U.S. and Iran.
As geopolitical tensions eased, investors returned to growth-heavy favorites like Microsoft and ServiceNow, which offer high-margin subscription revenue and clearer paths for integrating generative AI into enterprise workflows.
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:
- Sales Software company HubSpot (NYSE: HUBS) jumped 6.8%. Is now the time to buy HubSpot? Access our full analysis report here, it’s free.
- Marketing Software company Braze (NASDAQ: BRZE) jumped 9.1%. Is now the time to buy Braze? Access our full analysis report here, it’s free.
Zooming In On Braze (BRZE)
Braze’s shares are extremely volatile and have had 36 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 2 days ago when the stock gained 5.8% on the news that investors moved to buy the dip in high-quality SaaS names that had become significantly oversold amid a fragile market rebound driven by cautious optimism surrounding U.S.-Iran ceasefire talks.
While the Dow Jones Industrial Average retreated under the weight of a spike in oil prices and the naval blockade of the Strait of Hormuz, traders hunted for value in software leaders. Market participants increasingly decoupled cloud-native business models from the physical logistical nightmares and soaring fuel costs straining the broader economy.
This "buy the dip" conviction was further catalyzed by high-profile analyst support for sector leaders like ServiceNow. Bernstein reiterated an "Outperform" rating, framing the company as a foundational AI agent platform with an impenetrable moat in business process automation.
Braze is down 30.7% since the beginning of the year, and at $22.56 per share, it is trading 38.9% below its 52-week high of $36.89 from May 2025. Investors who bought $1,000 worth of Braze’s shares at the IPO in November 2021 would now be looking at an investment worth $241.51.
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