Wall Street took Monday’s initial stock market sell-off as an opportunity to buy beaten-down names. The action also hinted at what investments may keep performing as the U.S.-Iran war continues. The Nasdaq Composite was higher during afternoon trading, staging a massive reversal from its slide earlier in the day when the U.S. and Israel’s joint attack on Iran over the weekend caused the stock market to open red across the board. The Dow Jones Industrial Average was last in negative territory, while the S & P 500 was near the flatline; both indexes were off the lows of the session. Monday’s trading was a reminder that geopolitical conflicts have a limited impact on the stock market , pricing in the worst-case scenario early before taking back that risk. The S & P 500 has lost more than 8% peak to trough on average during major geopolitical shocks, but it has more than fully recovered after three months, according to Bank of America Securities. Nevertheless, what happens next depends on how long the U.S. war on Iran lasts. The severity of any disruption to the passage of oil in the Strait of Hormuz or to any major regional energy facilities will also be a factor. Iran’s Revolutionary Guard said it has closed the Strait , Reuters reported on Monday, sending oil prices higher after the close. “Protracted or not, that is the question,” Claudio Irigoyen, global economist at Bank of America Securities, wrote on Monday. Here’s what that could mean across asset classes. Gold Investors should buy gold and fade it “only after” the war is over, according to Jan Stuart, global energy strategist at Piper Sandler. The safe-haven asset that’s already in an uptrend will likely get another boost from the conflict toward all-time highs. Spot gold was last higher by 1% on Monday, off the highs of the session. “The current geopolitical backdrop is likely to generate a renewed push toward this resistance band,” wrote Laurence Balanco, technical analyst at CLSA. “However, such a move should be viewed as a cyclical upswing within an ongoing consolidation, rather than the start of a sustained breakout.” “This consolidation phase is expected to provide the structural platform for a more meaningful upside resolution and continuation of gold’s longer-term uptrend,” Balanco added. Energy stocks The outlook for energy stocks just got more complicated following the war in Iran. Investors may have been considering trimming their exposure to energy stocks after their massive rally this year, with the sector leading the S & P 500 and surging more than 26% in 2026. If hostilities end quickly, oil prices could drop back to a range of $60 to $70 per barrel , but any attack by Tehran on any neighboring facilities could mean Brent prices above $100 a barrel, according to Francisco Blanch, commodity strategist at Bank of America. A prolonged disruption could mean a spike of $40 to $80 a barrel, the strategist said. Chevron and Exxon Mobil were among the energy stocks to rally Monday. Defense Defense stocks were among the beneficiaries in Monday’s session, but a drawn out conflict could actually dim the sector’s outlook more than a swift resolution, according to Deutsche Bank Research. “It is true that a more extended conflict could drive greater near-term weapons consumption and budget support via operational necessity,” Scott Deuschle, research analyst at the firm, wrote. “However, this could potentially come at the expense of de-legitimizing the use of force and the perceived value of military spending broadly, while also creating political risk for Republicans in the event that there is greater loss of U.S. life, or negative economic repercussions,” he added.