Next week on the stock market

BT finds itself in a period where investors can see an end to the massive investment in fibre buildout, which should bring a material improvement in areas like cash flow, but the current market remains a challenge. Openreach is a key differentiator to peers, and broadband line losses will be a key area to watch in next week’s half-year results after the 196,000 decline in the first quarter. Consensus is looking for around 167,000 losses over the second quarter. We’ll also have one eye on commentary to see if there are any early signs of an improving broadband market that could help to stem those declines moving forward.

From the consumer angle, inflation-linked price hikes have been a tailwind for the pasts couple of years that’s now come to an end. Management has already warned that the first half could see weakness, as newer customers or those renewing are placed on lower-priced contracts given inflation has eased. Weakness is expected, and guidance into the second half of the year will be key.

Marks & Spencer’s has done a great job at breathing new life into the business over the past couple of years. Its food and clothing propositions have been sharpened, helping the group steal market share away from its competitors. Operations have also been streamlined, improving both profitability and the balance sheet enough to restore dividend payments last year.

We expect to see this upward trajectory continue when results are announced next week. With no full-year guidance given, it’ll be important to see at least some progress on all fronts. Markets have forecast first-half revenue to grow around 5% to £6.4bn, which looks achievable in our eyes. We’re also keen to get an update on M&S’s joint venture with Ocado. Relations were souring and losses were widening last we heard, so some better news on this front would be welcomed by all.

Sainsbury's put in a good showing in its first-quarter results, and we were relieved to see a volume-driven uplift in the grocery business. But consumers haven’t been as hungry for clothing and general merchandise, which both posted declines in the period. And thanks to its ownership of Argos, its extra exposure on the general merchandise front has weighed on overall performance.

Looking to next week’s results, we expect to see Sainsbury's continuing to claw small gains in market share. That’s thanks to its huge push to improve its products and value perception, which is helping to draw in more customers and drive volumes higher. Things like Nectar prices and Aldi price matches have so far worked at plugging the exit of customers too. But just how much of an impact this investment in low prices is having on profitability is something we’re keen to find out next week.