What Happened?
A number of stocks fell in the afternoon session after the Federal Reserve held its benchmark rate steady at 3.5%–3.75%, where it remained since the late-2025 easing cycle ended, and signaled through the dot plot that the next move may be upward rather than down.
The consumer discretionary sector had been hoping that the rate cuts of 2025 would eventually translate into improved consumer confidence and spending; instead, the FOMC's revised projections suggest those cuts may be partially unwound. Footwear brands sits firmly in the deferrable category as a shoe purchase is easier to delay than almost any other discretionary item and a consumer facing potential rate increases on top of 4.2% inflation is precisely the consumer who delays.
The dollar's appreciation on also added a currency headwind for brands with material European and Asian revenue. Inventory that had been gradually clearing now faces softer demand conditions before it fully works through the system.
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:
- Consumer Discretionary - Footwear company Genesco (NYSE: GCO) fell 2.8%. Is now the time to buy Genesco? Access our full analysis report here, it’s free.
- Consumer Discretionary - Footwear company Steven Madden (NASDAQ: SHOO) fell 3%. Is now the time to buy Steven Madden? Access our full analysis report here, it’s free.
Zooming In On Steven Madden (SHOO)
Steven Madden’s shares are quite volatile and have had 18 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 9 days ago when the stock gained 2.7% on the news that consumer discretionary stocks recovered alongside a broad market rebound, helped by easing geopolitical risk and a retreat in Treasury yields from the levels that triggered the previous week's selloff.
The sector was among those hardest hit when the Nasdaq fell 4.2% as the 10-year yield spiked above 4.5%, raising concerns about consumer debt costs and discretionary spending capacity.
With Iran declaring its first wave of strikes complete and Trump pushing for a ceasefire, oil prices retreated from overnight highs, reducing the energy-price shock risk that had threatened to squeeze household budgets. The World Cup beginning in the week added a modest consumer spending tailwind across retail, entertainment, and travel.
Steven Madden is up 1.6% since the beginning of the year, and at $42.88 per share, it is trading close to its 52-week high of $46.23 from January 2026. Investors who bought $1,000 worth of Steven Madden’s shares 5 years ago would now be looking at an investment worth $1,007.
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