Watson’s Weekly 05-12-2020

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.


  • China’s economy continues to do well (Monday) as factory activity is at the highest level it’s been for three years and there was a hike in new export orders. Also, Chinese consumer spending was also up (as we saw recently by the ongoing success of Singles Day) – so it all appears to be going well!
  • Investors have been putting record amounts of money into the markets (Monday) – so much so that the FTSE100 put in its best performance for 30 years (Tuesday)! Investors have been buying into value stocks (currently travel, leisure etc.) rather than growth but some traders are saying that there will be a dip going into the end of the year as funds rebalance and reduce their “over”-exposure to equities (Tuesday)
  • Bitcoin hit new highs again this week (Tuesday), nudging the $20,000 mark
  • OPEC decided to increase production (Friday) after much squabbling. They (and the non-OPEC group led by Russia) are only increasing production by 500,000 barrels a day and they will be monitoring it every month – so it’s not the ringing endorsement of the global economy that some are making it out to be


  • This week saw the Pfizer/BioNTech vaccine candidate approved in the UK (Wednesdayand it will be rolled out next week. It’s likely that it won’t make as much as Moderna’s candidate (Thursday), because it doesn’t have to share the spoils, but it will probably make more than the AstraZeneca/Oxford University candidate because these guys said they’d make it at cost. Interestingly, both Pfizer and Moderna’s respective share prices rose by about 20% this week
  • A number of behaviours brought about by the coronavirus came to the fore this week. Esports have become more popular under lockdown (Monday) with Twitch, unsurprisingly, reporting a huge rise in watchers, Zoom announced stellar results (Tuesday) as it continues to benefit from the working from home trend but clearly the main danger is Microsoft’s Teams (Wednesday). We all know that we are shopping more online these days but it’s getting so ridiculous that UPS is putting limits on client volumes in America (Thursday) – and we’ve not even got to Christmas yet! The National Retail Federation said that online shopping increased by 44% over the last weekend…


  • M&A activity in the UK is on the up (Monday) as bankers have got used to doing deals virtually, stock markets are rising and the advent of vaccines means that companies have slightly more visibility than before and can make some (tentative) plans
  • On the one hand, S&P Global announced the purchase of IHS Markit (Tuesday) in a deal worth $44bn as data providers continue to get together. Salesforce announced the purchase of Slack (Wednesday) which, at $27.7bn, is its biggest ever
  • However, on the other hand, G4S is continuing to fend off an unwelcome approach by GardaWorld (Thursday), UK estate agent Countrywide rejected a takeover approach from smaller rival Connells (Thursday) and is asking private equity firm Alchemy Partners to make another offer (their previous offer was rejected for being too low) and General Motors has decided to back out of its commitment to electric truck maker Nikola (Tuesday). GM had previously committed to buy 11% of Nikola, work on a joint pick-up project and share technology. However, given the roasting Nikola got from Hindenburg Research and subsequent debacle, it is hardly surprising that GM decided to pretty much pull out (it’s still going to share tech for now – apparently)


  • Arcadia collapsed (Tuesday) and a fire sale of its assets is going on (Friday), but it seems to me that none of the potential buyers will be interested in its shops – just the brands (although this could obviously change). Arcadia’s collapse was the last straw in the bidding for Debenhams – so JD Sports pulled out (Wednesday), leading to a frenzy of customers baying for a bargain as Debenhams started to sell off stock


  • The UK unexpectedly brought forward the ban on the installation of Huawei 5G equipment from 2027 to September 2021 (Monday), which will no doubt throw a spanner in the works for a timely 5G rollout. This is clearly handing even more opportunity to Huawei alternatives Nokia, Eriksson and, increasingly, Samsung
  • Warner Bros made a dramatic announcement that its 2021 movie releases will be released at cinemas and for streaming at the same time (Friday). This is an incredible development that could change the way we see movies in future IMO. This follows on from recent agreements between Universal, AMC Entertainment and Cinemark to shorten the gap between cinema and streaming release. It’ll be interesting to see whether this is something that lasts or whether we’ll slide back into having more of a gap


  • Watson’s Yearly updates: watch this space!


My favourite “alternative” stories this week were the shocking revelations in Man counts up contents of Quality Street tin and leaves people absolutely fuming (The Mirror, Luke Matthews) and the challenge in CIA challenges people to tell what time it is in deceiving snap – see if you pass (The Mirror, Paige Holland). Have you got what it takes to join the CIA??