A new pair of sneakers is an easy purchase to put off when filling up the tank suddenly costs $80 instead of $50. If oil and gasoline prices fall, the psychological effect can be bigger than the actual dollar savings. Suddenly filling up the car doesn't feel as painful. Consumers have a bit more breathingroom, and they become less defensive about discretionary spending. Maybe it's a new pair of running shoes, a hoodie, or a pair of Jordans that they were putting off.
Nike has been a heavily scrutinized stock, so once the market starts looking for evidence that the turnaround is working, small positives can suddenly matter a lot more: better traffic, fewer promotions, improving inventory, stronger full-price sales, or a better consumer backdrop.
People say Nike stock is getting hammered because it’s a dying brand and consumers prefer On Running or Hoka. While that may explain the crash from $169 to $70 it’s not why the stock crashed from $70 to $36. The fall from $70 to $36 goes hand in hand with ONON, DECK, DKS falling 20-40 % in the past month and the catalyst here was oil prices.
Nike earnings are coming up in a few weeks. Expectations have never been lower. They honestly can’t say anything that will make the stock crash. The reaction to earnings will either be flat or a pop.