Next week on the stock market

Analysts are expecting sales growth of around 6% from Alibaba in next week’s second quarter results, an improvement on the disappointing 4% level seen in the first quarter. Any miss on this may well be taken badly particularly in the context of recent efforts by the Chinese authorities to inject some stimulus into the economy. But it’s a little too early to call whether that’s had a tangible effect on spending power.

No surprise that the initial boost to the valuation has worn off a little, and with the price to earnings ratio well below the long-run average we’ll be watching whether the company ups the pace of share buybacks from its ample cash reserves. Alibaba is also looking to broaden its international reach so keep an eye on sales levels in its operations outside Asia.

AstraZeneca’s upgrade to guidance after its second quarter numbers hasn’t been enough to give a further shot in the arm to market sentiment. At the third-quarter health check the market is likely to be paying close attention to the pace of adoption of some core products where there’s hope recent approvals will provide a tailwind to growth.

Recent pipeline developments have been a mix of success and disappointment, but overall, we think the company is on the right path to hopefully meet its $80bn revenue target, and a mid-thirties operating margin by 2030. We’re not expecting any change to that longer-term steer, but some further reassurance wouldn’t go amiss. The same could be said about some further detail on the investigation by the Chinese authorities into AstraZeneca’s President in the region, Leon Wang.

It’s no secret that Direct Line has struggled over the past few years to deal with a challenging motor insurance market, and operational missteps have been a drag on performance. But recent results have painted a better picture than investors have had for some time. Armed with a fresh management team focussing on core areas like motor and home insurance, there’s renewed optimism that Direct Line can get back on track.

With the group back in the land of profit, third-quarter trading next week needs to show a continued recovery in net insurance margins, especially from the motor division. Last we heard, new motor contracts are being written at margins of above 10%, so we’ll want to see a return to profitability for the motor division over the second half. Customer numbers will also be in focus having lost 488,000 own-brand customers over the first half as prices saw mammoth hikes - stemming the mass exodus is key.