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 27 September 2024. BDN financial editor Roger Willis reports.

USA — GO WITH THE FLOW

Indices on Wall Street recovered from an early decline, after US consumer confidence data for September came in below expectations. But the People’s Bank of China’s latest huge barrage of economic stimulus measures assured positivity for American equities investors and those pretty much everywhere else.

The blue-chip S&P 500 and Dow Jones Industrial Average both closed on modest 0.6% weekly advances, while S&P’s MidCap 400 managed slightly less, just 0.5% up. NASDAQ’s tech-heavy Composite did best, adding 1%. Powersport stocks were mixed.

EUROPE — CHEERING THE CHANGES

European stock markets were buoyed mightily by the revelations from China, hitting some record highs. Investors also ramped up their expectations that the European Central Bank would cut interest ratings again at its next meeting, after inflation figures for two of the eurozone’s largest economies — France and Spain — came in far below forecasts. Frankfurt’s key Xetra Dax climbed by 4% and the FTSE MIB in Milan put on 2.9%.

Share prices for German automotive giants BMW and Volkswagen leapt skywards, their motorcycling activities in this case irrelevant to the much larger dependence they have on car sales in China, which are now looking at merciful recovery. The Wiener Börse ATX in Austria wasn’t so lively as other indices, rising by only 0.9%. Local KTM parent Pierer Mobility’s stocks continued their recent decline in value.

JAPAN — SKIN IN THE GAME

There is a considerable involvement for Japanese manufacturers in China, and Beijing’s sudden rolling wave of economic recovery investment would have been promptly welcomed. So building on the previous week’s 3.1% boost, Tokyo and Osaka’s Nikkei 225 stock market index surged much further upwards with a lavish 5.6% gain. Honda, Yamaha and Suzuki all have Chinese JV motorcycle production affiliates. And, besides bikes, Kawasaki has a wider range of links. Unsurprising, then, that their stocks surged in value.

INDIA — HARDER TO PLACE

In the first instance, Indian investors would have been bricking themselves about events in China, given that India regards its Asian neighbour as an economic threat at the best of times. But Mumbai investor reaction was relatively tame and market indices remained positive. S&P’s BSE Sensex 30 added 1.2% and the NSE Nifty 50 put on 1.5%. Behaviour among biker stocks was normal, with Bajaj Auto and Mahindra as the stand-out bets.

CHINA — THE NITTY GRITTY

Chinese equities bathed in the warmth of their best week since 2008, after the People’s Bank of China unveiled a spectacular economic stimulus package at the behest of Beijing’s Communist Mandarins. This pivoted around a war chest worth RMB800bn — US $114bn in proper money — which will essentially act as a copious lending pool for the country’s capital markets and the companies therein.

Shanghai and Shenzhen stock indices understandably went ballistic. The former’s SSE Composite stacked on 12.8% and the blue-chip CSI 300 spanning both locations climbed by 15.7%. Inevitably, all ten listed motorcycle producer stocks went along for the ride.