SHARE PRICES AND MARKET ANALYSIS

A snapshot of motorcycle and ATV industry share performance across key manufacturers and major global markets at the trading week closure on Friday 2 February 2024. BDN financial editor Roger Willis reports.

USA — BIG ON JOBS

The prospect of interest rate cuts by the US Federal Reserve central bank receded after much mid-week speculation. Driver was December’s spectacular jobs growth data release, which showed the American economy is hot to trot and doesn’t need any helping prods from the Fed. At the same time, equities trading was indecisive, as analysts pinpointed weaker quarterly results in some sectors and market indices swerved away from surges.

Both blue-chip S&P 500 stocks and the Dow Jones Industrial Average finished with 1.4% weekly gains. But S&P’s MidCap 400 struggled, a mere 0.1% up, on reports that imminent full-year figures from the likes Harley-Davidson and Polaris are likely to disappoint. The NASDAQ Composite was also behind an overall blue-chip curve, rising by 1.1%.

EUROPE — CONTINENTAL DIVIDE

The eurozone was split in half, as northern Teutonic economic woes conspired together with investor nerves over the profits outlook for Europe’s banking sector. Both BNP Paribas, the largest eurozone bank, and Dutch group ING warned of challenging circumstances for 2024.

But despite a slight 0.3% retreat for Frankfurt’s Xetra Dax index, German automotive stocks held up well. Austria’s Wiener Börse ATX fell a bit more, 0.4% down, and KTM parent Pierer’s share price was on the back foot. Further south, the Borsa Italiana MIB index in Milan continued to out-perform northern neighbours, adding a comparatively healthy 1.1%, although Piaggio shares went marginally negative.

JAPAN — WAITING FOR NUMBERS

Most Japanese companies are now on the cusp of revealing Q3 data. And a 1.1% rise for the Tokyo-Osaka axis Nikkei 225 market index reflected investor optimism. Among indigenous motorcycling majors, Honda and Suzuki attracted the most interest. But whether that is associated to their two or four-wheeled activities will be revealed next week.

INDIA — IPO-DRIVEN STOCK RALLY

Mumbai’s S&P BSE Sensex 30 and the NSE Nifty 50 market indices respectively rose by 2% and 2.3%, as a broad swathe of stocks rallied against a background of more than 60 initial public offers of stocks in new ventures sought to launch listings. Hyper-active speculators bought into existing good bets too, most notably boosting value for Hero, TVS and Royal Enfield parent Eicher.

CHINA — INVESTOR PANIC

Now we know what an economic meltdown with Chinese characteristics looks like. After dithering for more than a year, Beijing regulatory authorities finally forced the world’s most indebted residential property development company, Evergrande, into liquidation. Thousands of half-built Evergrande high-rise apartment blocks, their unglazed windows open to the elements, stand empty all over China, their aspirant dwelling owners’ mortgage deposits long since swallowed. Evergrande supremo Hui Ka Yan disappeared into custody several months ago and is allegedly been held on suspicion of “illegal crimes”. (Is there a different sort?)

Stock markets imploded before trading suspensions limited the rot. Shanghai’s all-share SSE Composite index plunged by 6.2%. The blue-chip CSI 300 lost 4.6%. Among the ten listed Chinese motorcycle manufacturers, seven of them suffered valuation losses of more than 16% in the past week, as spooked investors tried to cash in their chips. Quite extraordinary!