3 things to watch out for on the ASX 200 next week

ASX 200 finishes the week out lower

It has been a busy week for the Australia 200 index and global markets. Local labour data released on Thursday was weak; Afterpay continued to trade bullishly; Commonwealth Bank of Australia released their much-awaited Q3 results to the market, and the ASX 200 closed out the week lower at 5,404 points.

With this week now wrapped up, below we look at some of the key events and releases that investors may want to keep an eye on for next week.

Equities earnings and releases

Though the major March quarter earnings releases are all but over, there are still a few important names set to report their earnings or other pieces of market data next week.

On Tuesday, artificial intelligence and machine learning company Appen (APX) is set to hold an investor day; while construction giant James Hardie Industries (JHX) is poised to unveil its full-year FY20 results to the market.

On Wednesday Sydney Airport (SYD), which has seen its stock sold-down heavily as a result of the coronavirus, will report its April traffic figures.

Investors already have relatively good visibility on these figures, with SYD last month noting that during the first 16 days of April, the company witnessed a '96.1% decrease in International passenger traffic and a 97.4% decrease in Domestic passenger traffic versus the pcp.'

Finally, on Thursday, gambling heavy-weight Aristocrat Leisure (ALL) will report its half-year earnings results to the market.

Dividend events

Besides earnings and key market releases, the following ASX-listed companies are expected to trade ex-dividend next week:

• Macquarie Group will trade ex-dividend on 18 May. The company is set to pay a 180 cent dividend.
• AusNet Services will trade ex-dividend on 20 May. The company is set to pay a 5.1 cent dividend.
• Pendal Group will trade ex-dividend on 21 May. The company is set to pay a 15.0 cent dividend.

Key economic releases in focus

Turning to some of the key economic releases set to take place next week, the RBA is set to release their latest round of Meeting Minutes on Tuesday; Westpac will release data for its Leading Index covering April on Wednesday; and the Commonwealth Bank will release PMI data for May, also on Wednesday.

PMI data likely to be closely watched

In April, CBA’s PMI data revealed a predictably strong decline in business activity as a result of the coronavirus pandemic. Here, the bank’s key Flash Composite PMI hit 22.4 in April, down from 39.4 in March.

On a more granular level, CBA’s Flash Services PMI hit 19.6 in April, down from 38.5 in March; while the bank's Flash Manufacturing PMI saw less pronounced declines hitting 45.6 in April, down from 49.7 in March.

Speaking of these results, the bank’s head economist, Gareth Aird said:

‘The services sector has been hit a lot harder than the manufacturing sector. And the pace of job shedding is concerning though not surprising given the large number of Australian businesses that remain shut. The extent to which the PMIs rebound will be dictated in large part by the duration of the enforced shutdown.’

Similarly, Westpac’s Leading Index, which gives market participants an indication of the ‘likely pace of economic activity relative to trend three to nine months into the future’ also recorded a ‘sharply weaker signal’ as a result of the coronavirus pandemic, coming in at -2.47% in March.

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