SHARE PRICES AND MARKET ANALYSIS

A snapshot of bike and ATV industry share performance across key manufacturers and major global markets at the trading week closure on Friday 27 May 2022. BDN financial editor Roger Willis reports.

USA — FEAR FACTOR FADES

Latched onto vague signs suggesting inflation had peaked and the risk of recession was easing, US investors flipped to optimism after seven weeks of consistent negativity.

Wall Street’s market indices surged. The blue-chip S&P 500 and Dow Jones Industrial Average respectively grew by 6.6% and 6.2%. S&P’s MidCap 400 finished 6.5% up.

However, many analysts remained sceptical about how long this rally would last, taking the view that it could be driven by wishful thinking rather than any change to fundamentals.

HOGOMETER

Initially, Harley-Davidson wasn’t a guest at the party when US equities rallied, flatlining on Monday minus a solitary cent while the S&P rose by 1.8%. The index then briefly retreated by 1.7% on Tuesday and Harley fell further, 2.2% down.

But choppy trading on Wednesday saw the S&P start to recover again, 0.4% up. And Harley beat it dramatically as investor “buy the dip” enthusiasm kicked in, pushing the price up by 6.3%. Index rises of 1.8% on both Thursday and Friday were also trounced by respective gains for Milwaukee’s finest of 5.1% and 2.9%. So, Harley’s horrendous net loss of 13.7% across the previous week was almost entirely wiped out.

EUROPE — HERD INSTINCT

Clutching at transatlantic straws buoyed leading European indices with a measure of improving confidence too. Frankfurt’s Xetra Dax put on 3.4%, exceeded by greater gains for both BMW and Volkswagen. Similarly, a 2.2% lift for Milan’s FTSE MIB was beaten by Italian motorcycling flag-carrier Piaggio.

JAPAN — SECURITY NERVES

Japanese sentiment weakened and Tokyo’s Nikkei 225 index only managed to cling onto 0.2% weekly positivity. Prime minister Fumio Kishida, meeting US president Joe Biden mid-week, had pledged to substantially increase Japan’s defence budget in the face of Chinese sabre-rattling over Taiwan, blowing wind up the skirts of his country’s investment community. Apart from Honda, indigenous biker shares still stayed shiny side up by marginal portions.

INDIA — HOT UNDER THE COLLAR

India’s energy crisis — a lack of sufficient coal for electricity generation, to keep aircon running as a heat-wave rages — remained “hot” news. Mumbai’s BSE Sensex 30 stock index nevertheless added 1% and all major motorcycle stocks made advances.

CHINA — COUNTING COVID COST

The Chinese government admitted that its recent wave of extreme Covid lockdowns had hammered the economy and growth was now likely to be seriously inhibited for the rest of this year — despite various financial measures to support exporters.

Inevitably, market indices turned negative upon hearing these revelations. Shanghai’s SSE Composite and the blue-chip CSI 300 respectively sank by 0.5% and 1.9%, flipping from two consecutive weeks of recovery. Among the country’s eleven listed bike producers, six incurred losses. However, Benelli parent Qianjiang spectacularly bucked that trend.