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 DAY IN BRACKETS 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.
THIS WAS A WEEK OF ELECTION, IMPEACHMENT, RECOVERY AND RECESSION...
- So over in the US, the momentum is gathering to impeach president Trump (Friday) as all Ukraine-related dirty laundry is going to have to be aired in public rather than behind closed doors
- Meanwhile, in Europe, Boris Johnson got the general election he wanted on the date he wanted (Wednesday) while there were signs that Emmanuel Macron’s labour reforms are working (Wednesday) as France’s GDP went up (Thursday)
- Over in Asia, Hong Kong fell into recession (Friday) following the unveiling of a second successive quarter of GDP contraction, which isn’t really all that surprising considering all the protests that have been going on over the summer
DEPARTMENT STORES WERE MIXED & RETAILERS ADDED SERVICES...
- In contrast to the generally negative sentiment out there on department stores, France’s Galeries Lafayette announced plans to expand in China (Monday) by opening ten shops in the country by 2025. It believes that its China stores will generate around 15% of the group’s overall sales. Over in the US, Authentic Brands got the go-ahead to buy the Barneys New York brand and shops (Friday) although other parties could still make a last-minute bid – and JC Penney is experimenting with different formats to spark a revival (Friday) although it had better get going sooner rather than later as conditions continue to deteriorate
- Amazon announced that it would scrap grocery delivery fees for Prime customers (Wednesday) in the US – although it is expected that this will be rolled out elsewhere in due course. Not to be outdone, M&S announced a new “buy-now-pay-later” service (Wednesday) as it tries to appeal more to a younger audience who value the likes of Klarna – but I think they need to concentrate more on selling clothes that people actually want to buy 😜
TECH SAW STRENGTH, WEAKNESS & A BIT OF CONSCIENCE...
- Facebook announced strong third quarter results (Thursday), despite all the accusations and investigations as user numbers rose by 9% versus last year with average revenue per user was up by 19% over the same period. Zuckerberg said he’d continue to offer advertising to political parties – unlike Jack Dorsey at Twitter, who said he’d ban them (Thursday). Although this may sound to some like he is “woke”, I think he’s missing a trick here. Parties will be spending big in the run-up to next year’s election and he’s just handing business to Facebook on a platter. And for what? I think that as long as Zuck manages to make sure such content doesn’t get out of hand there will be no harm done IMO. Apple saw higher revenues from services and wearables among other things (Thursday) as sales of iPhones continue to lose their lustre (well, until 5G starts to kick in properly anyway!). On the other hand, Google saw a dramatic slowdown in paid clicks on adverts (Tuesday) as they only showed 1% growth in the third quarter versus the previous quarter due to rising costs. However, a juicy rumour emerged that Google’s parent, Alphabet, was thinking of buying Fitbit and *** NEWS JUST IN – Fitbit is to be acquired by Alphabet for $2.1bn, with the deal expecting to close in 2020 ***
...AND THEN THERE WERE SOME OTHER "BIG IMPACT" STORIES AS WELL...
- Fiat Chrysler and PSA Group boards announced an intention to merge (Thursday). It was also given the thumbs-up by the French government (which owns a chunk of PSA, the parent company that owns marques like Peugeot). This sounds good on a strategic basis but there will be a number of hurdles to jump through before it becomes reality. Still, I expect more consolidation in the industry as players huddle together to survive more onerous regulation and shrinking sales
- Lloyd’s of London faces a potential tsunami of insurance claims relating to pharmaceuticals companies involved in the US opioid crisis (Wednesday) which could potentially drown a number of insurers as some experts believe that the potential volume of claims could have a similar effect on the market that asbestos claims had in the 90s, where Lloyd’s almost collapsed. This could potentially be huge
- Then it turns out that Australia’s #1 supermarket, Woolworths, underpaid its workers for almost ten years (Thursday) in the latest underpayment scandal to hit Australia recently as Domino’s Pizza and 7-Eleven have also had similar issues. The Fair Work Ombudsman will be investigating further and trade unions across the country have launched a campaign against what they term “wage theft” calling for tough new laws to punish wrongdoers. Given the amount of compensation involved and the potential for this finding to be the tip of the iceberg, this could definitely get nastier…
Standout stories for me this week included Obese cat Cinderblock really cannot be bothered with vet’s treadmill (Metro, Richard Hartley-Parkinson https://tinyurl.com/yywtce4p) and holiday maxing in You can double the amount of days you have off work in 2020 if you plan it now (The Mirror, Luke Mattews https://tinyurl.com/y2f6ffww).
I hope you have a great weekend whatever you get up to!