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 23 June 2023. BDN financial editor Roger Willis reports.

No sooner had Wall Street relaxed, following an impressive annualised CPI inflation decline, US Federal Reserve chairman Jerome Powell intervened with a warning that further interest rates would nevertheless be inevitable to curb still dangerously high “core” inflation.

Trader disappointment was manifest as market indices sank in unison. The blue-chip S&P 500 and Dow Jones Industrial Average closed on respective 1.4% and 1.7% losses. NASDAQ’s tech-oriented Composite also finished 1.4% down. Biggest punishment was reserved for S&P’s MidCap 400, which fell by 2.5%.

NYSE-listed petrolhead powersport stocks all turned negative. But Harley’s LiveWire ePTW spin-off — also a NYSE resident — made its fifth consecutive weekly advance. Among the NASDAQ sparkies, Italian electric superbike purveyor Energica’s private equity parent Ideanomics performed the wild gyrations of a typically gestural “penny share”. But big-league Chinese e-mobility player Niu, a much firmer proposition lurking on NASDAQ, lost some more ground.

Hawkish signals spanned the Western world, as central banks in the US and Europe prioritised their struggles against stubbornly high inflation while evidence of slowing economies mounted. A series of business surveys on both sides of the Atlantic revealed economic activity had stalled in both the US and eurozone, bolstering analyst predictions that inflation-taming policies would inevitable lead to recessionary spankings.

Key European market indices relating to the motorcycle firmament reflected such gloom. Germany’s Dax Performance yardstick in Frankfurt sank by 3.2%, as both BMW and Ducati parent Volkswagen Group shed value. The Wiener Börse ATX in Austria finished 4% down while KTM parent Pierer retreated in line with local sentiment. In Italy, Milan’s FTSE MIB was 2.3% in arrears and scooter supremacist Piaggio slipped too.

Focusing on the increasingly sombre developed-world mood, Japanese confidence crumbled. Tokyo’s Nikkei 225 index turned sharply negative, retreating by 2.8%. Although the share prices of Japan’s four indigenous motorcycling majors have enjoyed a strong rolling month, investor enthusiasm was clearly petering out. Only Yamaha stayed shiny side up at the past week’s conclusion.

While mercurial Hindu nationalist prime minister Narendra Modi was schmoozing geriatric US President Biden on a state visit to Washington, his meddlesome Ministry of Corporate Affairs initiated a probe into alleged financial shenanigans at India’s largest motorcycle manufacturer, Hero MotoCorp.

Government fingers potentially looting the tills of industrial titans always upsets Indian investors. And this was no exception. Mumbai’s BSE Sensex 30 stock index abruptly lost the previous week’s progress, sliding into red ink by 0.6%. Share price positivity among bike producers vanished in parallel.

People’s Bank of China input to promote economic recovery turned into a shambles, after the central banker comprehensively cocked up a move to radically reduce the country’s mortgage-linked five-year loan prime interest rate — thereby rebooting its deeply troubled domestic property development market. However, the cut’s modest scale wildly undershot investor expectations, engendering a sell-off in real estate stocks which in turn undermined broader confidence.

Market indices were hammered. Shanghai’s all-share SSE Composite dropped by 2.3% and the blue-chip CSI 300 closed 2.5% lower. Biker stocks, which had been almost entirely positive a week earlier, declined across the board. Of the three which remained positive, two were state holding companies controlled by the Chinese Communist Party — Jialing parent CETC and Yamaha JV partner Jianshe — where minimal free floats can be massaged to suit propaganda requirements.