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 7 July 2023. BDN financial editor Roger Willis reports.

USA — HERE WE GO AGAIN

US borrowing costs touched a 16-year peak. Yield on two-year US Treasury notes, which tracks interest rate expectations, reached its highest level since 2007’s credit crunch, as data showed growth of new private-sector jobs in America during June almost doubled economists’ estimates.

The thus over-heating US economy provoked a wave of fear, as investors everywhere cranked up their bets on further base rate rises. Global stock markets tumbled in response. New York market indices led this stampede. The blue-chip S&P 500 and Dow Jones Industrial Average finished respectively 1.2% and 2% in arrears, despite a partial recovery on Friday which reduced weekly losses for S&P’s MidCap 400 and the tech-heavy NASDAQ Composite to 0.7% and 0.9%.

Biker stocks, which are spread across MidCap and NASDAQ listings territory, escaped lightly. But both Harley-Davidson and its LiveWire ePTW spin-off sank into negativity.

EUROPE — PANIC STATIONS

With both the eurozone’s ECB and the Bank of England reacting to America’s enfeebled sentiment, the imminent likelihood of their own additional base rate rises destabilised investment activity. Europe’s continent-wide Stoxx 600 index suffered a 2.3% decline on Thursday, its biggest one-day drop since March. In parallel, London’s FTSE 100 sank by 2.2%.

European market indices carrying motorcycle-related equities were consistently on the back foot. By the weekend, Germany’s Xetra Dax in Frankfurt had incurred a 3.5% five-session decline. BMW stock fell further, by 5%. Milan’s FTSE MIB in Italy closed 1.8% down, while its biggest PTW representative Piaggio took a more punitive loss. Austria’s Wiener Börse ATX was a more modest 1.1% lower and KTM parent Pierer Mobility completely bucked that trend with a 1% gain. Publicising expansion of its Chinese partnership with CFMoto during the week was probably responsible for such good fortune.

JAPAN — RAGGED NERVES

The US borrowing costs surge and resultant stock market turmoil inevitably freaked out timid Japanese investors. Tokyo’s Nikkei 225 index therefore sank by 2.4%. But the effect on indigenous biker stocks was mixed. Minor losses for Honda and Yamaha may have been associated to their considerable exposure to US-held shareholdings and debt.

INDIA — BUSINESS AS USUAL

Fairly well insulated from financial depredations in the US, Mumbai’s BSE Sensex 30 market index managed a reasonable 0.9% gain. Stand-out sorrow was only visible for Royal Enfield parent Eicher, which had just filed some particularly unefficacious quarterly motorcycle sales data with stock market regulators.

CHINA — OIL ON TROUBLED WATERS?

Despite US Treasury Secretary Janel Yellen’s high-profile visit to Beijing, seeking to tone down worsening trade disputes and verbal warfare between China and America, Chinese investors clearly don’t hold much hope for a friendly reset in relations.

Shanghai’s all-share SSE Composite index and the blue-chip CSI 300 remained negative, respectively 0.2% and 0.4% down. However, most indigenous motorcycle manufacturers and exporters are unperturbed. Only three of China’s eleven biker listings were losers in the past week.