Nike and other retail stocks rise after Trump's trade deal with Vietnam reduces tariffs.

Shares of Nike and other apparel makers surged after President Trump announced a trade deal with Vietnam, imposing a lower 20% tariff on imports, down from the initially proposed 46%. Companies had been shifting production to avoid higher costs from Trump’s proposed tariffs on Vietnam, Cambodia, and Indonesia.

The fluctuating tariff policy has caused uncertainty for companies and investors, impacting financial targets. Analysts believe clarity on tariffs will help companies plan for the year ahead. The deal with Vietnam also includes a 40% tariff on trans-shipments and increased market access for U.S. exports.

Nike’s shares rose 4%, Under Armour 2%, and Levi Strauss nearly 2%. Abercrombie & Fitch saw a modest increase, while On Holding stock, backed by Roger Federer, rose 3%. Analysts suggest investors view the deal as a positive sign for rescinding threatened tariffs on Vietnam and other countries.

Despite the positive market response, the deal with Vietnam could heavily impact the footwear industry, which relies on the country for over half of athletic footwear imports. Footwear Distributors and Retailers of America CEO expressed concerns about piling new tariffs on top of existing ones, hurting American families and businesses.

Best Buy’s shares saw a slight increase, as the company had factored in Trump’s 10% base tariff rate in its annual forecast. Analysts anticipate suppliers will adjust supply chains to avoid the 40% trans-shipment tariff. Overall, the deal brings clarity to the electronics industry and reduces downside risk for Best Buy’s outlook.

Read more at Yahoo Finance: Nike, other retailer stocks rise on Trump’s trade deal with Vietnam to reduce tariffs