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 24 May 2024. BDN financial editor Roger Willis reports.

Wall Street investors blundered all over the place in the past week, as did market indices. Conflicting US economic data was largely responsible for losses, while the strong quarterly fortunes of American microchip giant Nvidia promoted gains.

At one point, the blue-chip S&P 500 suffered its biggest one-day drop of the month, before recovering to close virtually flat — positive by just 0.1%. The Dow Jones Industrial Average finished 2.3% in arrears and S&P’s MidCap 400 was also a loser, 1.3% down. All six biker-related stocks were consistently negative. Only the tech-heavy NASDAQ Composite blossomed, rising by 1.4%.

Debatable UK inflation figures, with some yardsticks still dangerously high, left the Bank of England in a difficult place ahead of the UK general election on 4 July. Analysts noted an “uncomfortable political dimension” will preclude the BoE’s ability to cut interest rates until a new government is in power. And although the eurozone economy is now showing stronger signs of recovery, the European Central Bank is also reluctant to move on interest rates before either the BoE or US Federal Reserve.

That sapped trading confidence across Europe and market indices struggled for traction. Both Germany’s Dax Xetra in Frankfurt and the Wiener Börse ATX in Austria recorded minor 0.1% losses. Milan’s FTSE MIB in Italy went further, posting a 2.6% decline. Every motorcycle-related stock listing lost value.

The Bank of Japan’s historic policy shift on negative interest rates has now seen ten-year government bond yields climbing above 1% for the first time in more than a decade. Japanese investors are now bracing themselves for higher borrowing costs, anticipating that the BoJ will push interest rates steadily upwards.

Overall market response turned the Nikkei 225 stock index in Tokyo and Osaka negative by 0.4%. But punters trading in motorcycle manufacturer shares were clearly untroubled.

Now taking little notice of India’s ongoing general election, Mumbai investors are sticking to business as usual and the two key market indices tracked each other closely again. S&P’s BSE Sensex 30 added 1.9% and the NSE Nifty 50 rose by 2%. Without exception, all five major Indian motorcycle producers gained value, with Royal Enfield parent Eicher furthest ahead of the game.

A sovereign bond issue worth £4.3bn in proper money by the Beijing government hit the buffers on its market debut, with trading quickly suspended, as exchange regulators warned of “abnormal fluctuations” and urged investors “to be rational and pay attention to the risks”. The issue was intended to fund government spending on critical economic growth areas.

The first batch of these bonds had been launched on the Shanghai and Shenzhen stock exchanges — the market indices of which both plunged in unison by 2.1%. Every listed motorcycle manufacturer also suffered in this sell-off.