Watson’s Weekly 21-06-2025

This is an amalgamation of the “best bits” of the daily weekday newsletter/blog woven together to form a concise and coherent view on the things that matter in the commercial and economic news of the week. 

THE COLOURED HIGHLIGHT REFERS TO THE EDITION WHERE THE STORY APPEARED IN WATSON’S DAILY. Clicking on the day will take you to the appropriate edition of Watson’s Daily.

IN WAR NEWS…

• The Israel-Iran war raged on as each side blamed the other, Trump called for “unconditional surrender” and dithered about whether the US would get involved while Gulf states rallied behind Iran and companies in the region started to make more contingency plans.

IN NEWS ABOUT THE GLOBAL ECONOMY…

• The G7 summit went ahead in Canada but Trump left early, ostensibly to talk about the Israel-Iran situation.

IN TRUMP THINGS…

• IN CUTS AND THREATS – Trump tightened the screws on immigrants again by proposing an increase in the tax on money that migrants send home, slashed government spending on health research to its lowest level since September 2014, threatened to keep a 25% on UK steel imports over concerns about the sources of Port Talbot’s steel and saw bankruptcies of two US solar companies as a result of his anti-green agenda.
• IN FAVOURS, PRAISE AND APPEALS – Trump moved forward with the implementation of the trade deal with the UK and US commerce secretary Lutnick applauded the popularity of Trump’s $5m-a-go visa scheme. The president decided to delay the decision on what to do with TikTok for a third time and launched a gold smartphone with its own network.

IN INDIVIDUAL COUNTRY NEWS…

• IN THE US – the Fed held interest rates on hold, defying Trump’s demands to cut them.
• IN CANADA – PM Carney announced measures to protect the country against a flood of steel and aluminium imports, adding that he could increase taxes on the US based on how talks with Washington go by July 21st.
• IN RUSSIA – we saw Russia’s economy minister say that the country is on the brink of recession as the growth effect of Trump’s massive defence spend is now running out.
• IN SWITZERLAND – the Swiss National Bank cut interest rates from 0.25% to zero – its sixth cut in a row. The move was widely expected and was prompted by falling inflation and a rising Swiss franc.
• IN UK – inflation eased slightly to 3.4% but the Bank of England decided to leave interest rates unchanged at 4.25%, although there were hints that there would be more cuts to come. Chancellor Reeves set out a 10-year UK infrastructure plan and indicated that UK defence spending won’t rise above 2.6% of GDP this parliament. She is also considering a U-turn on the government’s non-dom tax stance. Meanwhile, the Public Accounts Committee told the Treasury that over 50% of councils will go bust unless the government helps them. HS2 got delayed beyond 2033 and the previous government was obviously blamed.

IN OIL NEWS…

• Oil prices rebounded as the Israel-Iran war raged on and it looks likely that our petrol prices will rise as a consequence, ironic considering the government’s current stance on drilling in the North Sea.
• The latest IEA reckons that China will reach peak oil demand within two years as sales of EVs continue to skyrocket. It predicts peak global oil demand in 2029.

IN CONSUMER TRENDS…

• American travel demand is falling as US consumers feel the pinch and cut expenditure, according to the latest data from the Transport Security Administration.
• UK consumer confidence has made a modest recovery, according to the latest GfK consumer confidence survey, but there are still lingering concerns about petrol prices and the effects of the war in the Middle East.

IN EMPLOYMENT TRENDS…

• Amazon boss Andy Jassy said that AI will inevitably lead to lower employee numbers, especially in logistics, and there’s ongoing debate as to whether the increased use of AI will also reduce the need for juniors in professions like investment banking. That being said, research by MIT says that overuse of AI makes you stupid because it restricts the development of critical thinking, memory and language skills.
• Meanwhile, the latest data from REC shows “some resilience” in the UK jobs market but recruiter Hays continues to have a ‘mare thanks to demand for permanent staff evaporating.

IN BUSINESS TRENDS…

• Corporate America has gone quiet under Trump as no-one wants to attract his ire. DEI has been a victim of this and a number of prominent law firms have ditched their Pride logos on their LinkedIn and X pages this year. Notably, Slaughter & May has stuck with it but perhaps this is because its US business is a lot smaller than all of its magic circle rivals.
• British manufacturers are now looking at export destinations outside America given the effect of triple T – Trump Tariff Turmoil – on their business. The US has now fallen out of the top three global regions that UK manufacturers expect to do business with.
• UK manufacturing is on the verge of getting support from the government as ministers discuss policies that target high-electricity-use businesses in particular as well as manufacturers more broadly.

IN INVESTMENT TRENDS…

• SPACs are hot once more after a few barren years following the peak in 2021. Even Goldman Sachs is returning to the fold which means that others will probably follow…
• Lloyds Bank’s pensions division, Scottish Widows, is looking at cutting its exposure to UK equities and switch it out to better-performing markets. This flies in the face of the chancellor who is trying to get British pension funds to invest more in British assets.

IN FINANCIALS NEWS…

• Digital asset platform Tron is on track to go public in the US via a reverse merger with NASDAQ-listed SRM Entertainment. The new venture will buy and hold the Tron token and Eric Trump looks likely to take a role in the company that will be called Tron Inc. Shares in SRM Entertainment boomed by up to 647% in trading yesterday! This taps into two hot trends – crypto and SPACs!
• Hedge fund Millennium is looking to sell a 10-15% minority stake to investors, opening up its ownership for the first time in its 36-year history. This is clearly part of succession-planning, but I also think that it shows confidence in investor willingness to get engaged.
• IN BANKS NEWS – Metro Bank’s share price jumped on rumours of a takeover approach from PE firm Pollen Street Capital and then we heard that Spanish bank Sabadell is looking to sell UK high street bank TSB. NatWest pulled out of the bidding for TSB but Banco Santander seems to be the front-runner at the moment.

IN EV NEWS…

• Analysts have been getting increasingly downbeat on Tesla thanks to falling car sales but it’s possible that its robotaxi ambitions will save the day – although we’ll have to wait a bit for that.
• European carmakers are running out of rare earths and China suppliers are making it difficult to source them. Surely China holds all the cards here meaning that it’ll be difficult for Europe to be too overly protective re Chinese EV imports.

IN TRAD MAKER NEWS…

• Renault’s CEO, Luca de Meo, is stepping down to become CEO at Kering. He’s done well at Renault so will be tough to replace.
• JLR warned that profits will take a hit due to it having to suspend exports to the US for a brief period. The new US-UK deal will hopefully reverse this though…

IN DRIVERLESS…

• Waymo announced its intentions to take its robotaxis to New York. This is interesting considering the recent push to operate driverless taxi services in the UK.

IN TECH NEWS…

• xAI is on the verge of raising $9.3bn in debt and equity – so investors don’t seem to have been put off by the recent collapse in the Musk/Trump bromance!
• OpenAI made the headlines for a few reasons this week! Microsoft said that it’s prepared to walk away from its multibillion-dollar alliance with OpenAI due to strategic differences and OpenAI’s boss accused Meta of trying to poach his top AI experts. Meta hasn’t commented on this.
• Meta announced plans to introduce ads on WhatsApp, going against the promise of its original founder. It caused outrage but surely it was inevitable!
• The French government is looking to more than double its stake in satellite operator Eutelsat that will consolidate its hold of OneWeb, Europe’s answer to Musk’s Starlink.

IN SOCIAL MEDIA…

• X is getting closer to offering investment and trading on the platform as part of Musk’s ultimate goal to make X a “super-app” in the mould of China’s WeChat. There was even talk of an X credit/debit card by the end of this year.

IN STREAMING…

• Netflix announced that it will start broadcasting live TV from France’s biggest commercial broadcaster TF1 that will allow subscribers in the country to watch live TV. The deal with TF1 is the first time that a streaming channel will have carried live channels in full!

• IN RETAIL – US retail sales fell by the most in 2 years as Trump’s tariffs are starting to filter through. In the UK, TM Lewis is now returning to the high street, Poundland is going to be shutting 68 stores as part of a restructuring and Oxford Street is going to be pedestrianised. Detailed proposals are going to be published later this year.
• IN PROPERTY – US housing construction activity has fallen to a 5-year low thanks to tariffs pushing up materials prices, higher mortgage rates and higher inventory levels. In the UK, Rightmove stats show that asking prices have weakened (which is uncharacteristic for this time of year) but many expect prices to rebound again. Meanwhile, the outflow of non-doms has hit London’s prime housing market as international buyers lost interest.
• Airbus announced that it had signed almost $10bn worth of orders on the first day of the biennial Paris Air Show. Boeing had to cut back its activities at the air show following last week’s fatal Air India crash.
• Starbucks is suffering in China and has seen its market share evaporate due to fierce competition. There’s now talk of it finding a partner and selling off some of its China business to reduce its exposure.
• Pernod Ricard announced a restructuring of its business in response to the weakening global market for alcohol. It said that it will centralise some functions and administration, which is bound to lead to some job cuts.

My fave video from this week was the one with two guys by the seaside. The “little” guy’s voice is just incredible…