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 19 January 2024. BDN financial editor Roger Willis reports.

Yet another see-saw week began with global equities sliding, driven by strong doubts about China’s economic health added to caution from central bankers in the US and Europe over the outlook for interest rates. But by Friday, sentiment had been transformed. Wall Street stocks hit an all-time high, with powerful gains for large technology companies pushing indices to record levels after the year’s shaky start.

Blue-chip S&P 500 firms led the charge, peaking 1.2% up. NASDAQ Composite techie superstars were also to the fore, collectively climbing by 2.3%. The Dow Jones Industrial Average and S&P’s MidCap 400 were positive too, although less enthralling, with respective 0.7% and 0.5% rises.

However, concerns about China didn’t go away and were amply illustrated by the woes of NASDAQ-listed Chinese ePTW giant Niu Technologies, which has been steadily losing stock value and sales volume. Niu’s full-year unit sales of electric mopeds, scooters and motorcycles in 2023 were 14.6% down to 709,802. Some 600,994 of these were sold in China and 108,808 exported to international markets, including a few to the UK.

Eurozone market indices with motorcycle industry presences were all on the back foot — but losses weren’t allocated to any particular weakness on their behalf. Instead, investors were rattled by inescapable news that the German economy, traditionally Europe’s most muscular driving force, was spannered and now officially in recession.

Due notice was taken by Teutonic traders in Frankfurt, where the Xetra Dax retreated by 0.9% and both BMW and Volkswagen shares dropped by considerably larger margins. Adjacent Austria’s Wiener Börse ATX suffered a harsher 1.6% dive and KTM parent Pierer’s stock took a kicking too. Milan’s FTSE MIB fell by a smaller degree of 0.6% and Piaggio successfully dodged any punishment whatsoever.

Japanese investors enjoyed a good week, as quarterly results emerged highlighting positive earnings for indigenous microchip makers. Tokyo and Osaka’s Nikkei 225 index rallied on the back of that, finishing 1.1% up. The parental entities of Honda, Yamaha and Suzuki, shortly to release their own Q3 data, rode higher on this benign mood. the Kawasaki Heavy Industries conglomerate, its powersports business shackled to an awkward squad of often underperforming divisions, didn’t.

The speculative surge for motorcycle manufacturing stocks, engendered by Bajaj Auto’s extravagant share buy-back proposition during the previous week, petered out rapidly. A resultant hangover saw the majority shedding value in response and may have contributed to Mumbai market indices turning negative. S&P’s BSE Sensex 30 and the NSE Nifty 50 respectively declined by 1.6% and 1.5%.

In an extraordinary stealth intervention, Chinese equities regulators have begun to order institutional investors to cease selling stocks, in what has swiftly proved to be a failed attempt to stabilise plummeting share prices since the new year. Despite these threats, market indices continue to retreat. In the past week, Shanghai’s all-share SSE Composite and the blue-chip CSI 300 of top companies listed in Shanghai and Shenzhen respectively fell again, by 1.7% and 0.4%.

Among the ten listed Chinese motorcycle manufacturers, nine were losers. The solitary winner was Sundiro’s Honda JV, which exports virtually its entire production in CKD kit form to Honda assembly plants in SE Asia and Japan.