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 17 February 2023. BDN financial editor Roger Willis reports.

USA — FALSE EXPECTATIONS

Once again, a week of two halves on Wall Street wiped out earlier gains. American investors began by betting that upcoming economic data would ease the pressure on Federal Reserve central bankers, thereby cancelling the likelihood of further interest rate rises. But when such data duly emerged, it was evident they’d called the wrong shots.

January’s US producer price index had risen at an annualised rate of 6%, down from 6.2% in December but significantly higher than a consensus estimate of 5.4%. In parallel, retail sales in January had been very strong, clearly indicating that the US economy is still running hot. Taken together, they pointed at persistent inflation, suggesting further rate rises will be necessary and factoring out any chance of the rate cuts some analysts had been predicting for later this year.

Suffering their worst session for a month on Thursday, market indices retreated from previously positive positions. The blue-chip S&P 500 and Dow Jones Industrial Average finished on respective 0.3% and 0.1% losses. But having made much greater initial gains, S&P’s MidCap 400 closed 1% up and the tech-savvy NASDAQ Composite clung onto 0.6% positivity. Biker stocks generally bucked the market mood, only Harley-Davidson’s LiveWire offshoot sliding marginally into red ink and Energica parent Ideanomics flatlining.

EUROPE — NARROW ESCAPE

European markets were buoyed by news of swiftly falling wholesale gas prices, after a generally mild winter has left continental reserves in a very healthy position — and comprehensively poked Vladimir Putin in the eye. By the time European Central Bank president Christine Lagarde had saddled up her high horse to issue inflationary warnings on Wednesday, taking cues from US Federal Reserve supremo Jerome Powell to stress the need for more eurozone interest rate rises, impetus was sufficient to keep investors’ show on the road.

Germany’s Dax Performance index in Frankfurt and the Wiener Börse ATX in Austria closed with respective 1.1% and 1.5% weekly gains. Among Teutonic motorcycle-related stocks, both BMW and Volkswagen Group beat the Dax average. Sliding fractionally, KTM, Husqvarna and GasGas parent Pierer Mobility didn’t manage a similar feat versus the ATX.

Italian business confidence continued to be more robust than eurozone neighbours in the north. Milan’s FTSE MIB index added yet another week of blissful positivity, rising by 1.8%. However, a four-week run of muscular share price improvements for national PTW flag carrier Piaggio tapered off into a marginal loss. The scooter giant’s full-year results are expected in early March.

JAPAN — BIKER BONANZA

Tokyo’s Nikkei 225 index flipped from three weeks of minor gains to a 0.6% weekly loss, as rank outsider Kazuo Ueda grasped the Bank of Japan’s governorship succession reins and a monetary policy shake-up loomed.

But the four Japanese motorcycling leviathans were on a roll, claiming their just rewards from investors for a clean sweep of muscular quarterly corporate performances. Honda’s profit-surge hegemony put it on top of the Q3 pile, its resultant share price increase easily outpacing runners-up Kawasaki and Suzuki. While Yamaha full-year 2022 figures were excellent too, 2023 forecasts for the company’s motorcycle operations underwhelmed, so stock-pickers felt the need to be somewhat circumspect.

INDIA — WHAT SCANDAL?

India’s ruling Hindu nationalist Bhartiya Janata Party did its best to put the lid on a massive Adani Group investment scandal. This dysfunctional conglomerate’s multi-billionaire supremo Gautam Adani just happens to be a close acolyte of BJP leader and Indian prime minister Narendra Modi. So any issues of alleged corruption disappeared instantly and it was back to business as usual for India’s investment community.

In Mumbai, trading settled down and the BSE Sensex 30 share index closed 0.5% up. Most motorcycle manufacturer stocks returned to positivity. Question marks continue to hang over the head of indigenous bike market leader Hero MotoCorp, though, which recorded its fourth successive weekly loss.

CHINA — BALLOONING HEADWINDS

A third consecutive week of decline for market indices covering mainland Chinese equities emphasised the febrile nature of China’s post-pandemic economic recovery and rising geopolitical tensions with the US — still its biggest export market. Shanghai’s all-share SSE Composite finished 1.1% down while the blue-chip CSI 300 fell by a firmer 1.7%.

China’s eleven listed motorcycle manufacturers took an almost unmitigated hammering, ten of them losers. The exception was CFMoto, which now figures as a joint-venture global manufacturing hub for expansionist European biker star Pierer Mobility.