Next week on the stock market

Barclays reports fourth quarter results next week, and investors will be watching for a potential £1bn share buyback with the bank leaning on its strong capital position – though nothing is guaranteed. Barclays has more exposure to the US than other UK banks, so there will be focus on how its US credit card customers are keeping up with repayments, as well as the usual eyes on UK loan default levels which have been robust of late. Interest rate expectations for 2025 will also be key, particularly any guidance on UK net interest income.

Another big talking point will be the Investment Banking arm, after US rivals posted strong results. It’s a competitive arena and Barclays has struggled to keep pace of late, so strong growth here could help lift sentiment. On the flip side, higher costs, largely due to a rising UK bank levy, are expected to squeeze profits on a quarter-to-quarter view, with pre-tax profit forecast at £1.6bn.

Despite the continued rapid decline of the tobacco market, British American Tobacco is set to deliver single digit growth in underlying revenue and operating profit when it reports 2024 numbers. But a strong US currency is inflating the value of its dollar denominated debt, meaning the balance sheet may look a bit more stretched than some may have hoped for.

Attention now turns to 2025 guidance, where growth hopes largely rest with New Category products such as vapes. That said, the recent decision by the Trump administration to withdraw a proposed ban on menthol cigarettes removes one potential headwind to legacy products. We’re also expecting an update on the financial impact of the proposed multi-billion-dollar legal settlement in Canada which relates to historical cover-ups of smoking-related cancer risks.

Unilever releases full year results next week with investors keen to see how CEO Hein Schumacher’s turnaround strategy is taking shape. Last quarter, Unilever reported sales of €15.2bn, with underlying sales growth of 4.5%, beating market expectations. We’ll be keen to see if Unilever has maintained its streak of consecutive quarters of positive and improved volume growth. With inflation pressures easing, investors will also focus on whether price hikes have continued to moderate and how this impacts overall sales growth, with 3-5% growth the latest guidance for 2024.

Gross margin improvement is another critical area, as the company aims for an underlying operating margin of 18% driven by cost saving initiatives. Updates on the productivity program and separation of the ice cream division will also be key.