Footwear stocks led by Nike (NKE) rose in morning trade on Wednesday after President Trump took to his social media platform Truth Social to share that he “made a Trade Deal with Vietnam.”
Nike, On Holding (ONON), Deckers (DECK), and Lululemon (LULU) spiked in immediate response to the news.
Retail and footwear stocks tempered initial gains as Trump outlined details of the deal in a subsequent post, which said Vietnam will pay a 20% tariff on all goods sent into the US and a 40% tariff on goods that are subject to transshipping, meaning routed through Vietnam with a different country of origin, like China.
After an initial pop to rise as much as 4%, Nike stock was up about 1.7% in mid-morning trade on Wednesday. Shares of ON were up more than 3.5% to lead the rally among footwear names, while Deckers and Lululemon shares were fractionally higher.
Read more about Nike’s stock moves and today’s market action.
Many of the footwear giants have already moved much of their sourcing away from China to Vietnam to diversify and avoid what the companies saw in the first Trump administration as the US-China trade war ramped up.
Nike told investors last week that costs from tariffs are expected to approach $1 billion as the company plans to make additional moves to diversify its supply chain away from China, which currently accounts for about 16% of the shoes it imports into the US. It expects to bring that down to the “high single-digit range” by the end of this fiscal year. The company also announced plans for a “surgical price increase” in the US, which is set to begin this fall.
Read more: What Trump’s tariffs mean for the economy and your wallet
Last month, Lululemon stock had its worst day since 2020 after it warned profits would take a hit amid what it called a “dynamic macro-environment,” with tariff uncertainty and some consumer softness weighing on its outlook.
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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