The S&P 500 rose by 10.2 percent and the Dow Jones Industrial Average increased by 5.0 percent for the 13 weeks ended June 30. The NASDAQ Composite improved by more than 16 percent. Meanwhile, despite persistent market uncertainty over the impact of U.S.-imposed tariffs on footwear, the BRQ Retail Index peaked in Q2’s final week with a score of ’99,’ and the Brand Index finished the period at ‘84’ after peaking at ‘96’ on the day after Memorial Day.

Throughout Q2, the macroeconomic data and information about potential tariffs were mixed and both positive and negative, forcing senior executives at public footwear companies to abandon their FY25 outlooks and their peers to remain alert to constantly changing developments after a tariff lull that benefited stocks. Renewed uncertainty about the direction of tariff rates for various countries could derail the positive momentum the markets have enjoyed in H1, opines some circles.

Good news came to many footwear companies in early July when the U.S. reached a trade agreement with Vietnam, a major supplier to the industry, avoiding a potential 46 percent-imposed tariff. Vietnam granted the U.S. total access to its economy for trade, and the U.S. will impose a 20 percent tariff on all goods imported from the Asian country. That tariff rate rises to 40 percent for any transshipping through Vietnam to the U.S. Of course, many footwear companies, fearful of the higher rate, had to import more Back-To-School and Holiday merchandise earlier than usual this year.

On the interest rate and economic growth fronts, the Federal Reserve is expected to slash the federal interest rate to a range of 3.25-3.5 percent by year-end.  The Fed has lowered its U.S. GDP forecasts for 2025 and 2026 to 1.4 percent and 1.6 percent, respectively, and hiked its outlook on yearly inflation growth to 3 percent this year from its previous forecast of 2.7 percent made in March. And during the first six months of 2025, while the DJIA rose by double digits, the U.S. dollar lost 10 percent of its value and U.S. retailers eliminated 80,000 jobs.

Meanwhile, according to the Conference Board, U.S. consumer confidence fell by 540 basis points in June to 93 percent from its May reading as people assessed current conditions and their short-term expectations for the economy.