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.
WE SAW SUNAK'S BUDGET, BIDEN EDGING TOWARDS BIG STIMULUS AND MORE VACCINE DEVELOPMENTS...
- UK Chancellor Rishi Sunak announced the budget this week (Thursday) and it was pretty much a spend now, tax later budget. One of the many aims of this budget was to encourage investment, with a new “super-deduction” tax break trumpeted as being key to this.
- President Biden is getting closer to pushing through his $1.9tn economic stimulus plan (Friday). It got the OK from the House of Representatives last week and went to the vote in the Senate this week. Kamala Harris had to get involved to move things forward, so the proposal is still alive *** NEWS JUST IN – The Senate just approved the bailout plan so it will now head back to the House of Representatives where it is expected to be endorsed ***
- Oil prices rose this week (Thursday) as oil producers decided to stick with current production quotas. Given that the general feeling is that demand will rise as lockdowns lift around the world, it’s natural for prices to rise as well if supplies stay the same
THE VACCINE FRENZY CONTINUED...
- In the US, President Biden pledged to have enough jobs to vaccinate all adults by the end of May (Wednesday), which was probably made even more possible by the fact that Johnson & Johnson’s single-shot jab got FDA approval (Monday). In an unusual move, rival Merck is going to produce Johnson & Johnson’s vaccine (Wednesday) because it has the capacity (it is the world’s biggest vaccine maker, but unfortunately its own coronavirus candidate proved to be disappointing) and the expertise. I thought it was interesting to note that CVS and Walgreens are benefiting from being a part of the vaccination drive (Wednesday) as they are basically harvesting contact details of those being summoned to get their vaccines and then tracking subsequent purchases. I think this sounds morally questionable considering that the government is footing the bill for other expenses and they are using the virus as an opportune marketing exercise on people who have to go into their outlets. On the other hand, I guess you’ve got to admire the retailers’ entrepreneurial spirit! If they continue to be allowed to do this, I would have thought this would be a decent positive for their respective businesses.
- In Europe, vaccine distribution continues to be poor and EU members are, one by one, taking matters into their own hands. Slovakia is already using the Russian vaccine (Tuesday), the Czech Republic is thinking about using it (Monday) and the Hungarians are getting the Chinese vaccine (Tuesday). Then Austria, Denmark and Israel have gone off to form their own side-deal (Tuesday) to produce Pfizer and Moderna vaccines and share vaccine stockpiles! Very cosy, don’t you think?? Germany (Monday) and France (Tuesday) have made massive U-turns and approved AstraZeneca’s vaccine for use in the over-65s , but it’s too late for the swathes of people who cancelled/didn’t turn up to vaccine appointments when they heard they were getting the AstraZeneca vaccine! Germany’s rollout continues to be pretty useless (Wednesday), which is surprising considering that it was seen as having one of the best responses to the pandemic not so long ago. It just goes to show how quickly you can go from hero to zero. Things really are getting pretty desperate as Italy blocked exports of AstraZeneca’s jab to Australia (Friday) and EC president von der Leyen is now trying to get Biden to send them supplies of AstraZeneca’s vaccine to make up for the production shortage. Clearly Biden will just give the EU American leftovers, but still it shows how desperate Europe is getting.
- In the UK – over 20m doses of vaccines have been distributed so far (Monday) and the Office for Budget Responsibility said that if rollout speeds up, all adults could get their first jab by June (Thursday), one month earlier than had originally been projected.
IPOs FEATURED QUITE A LOT THIS WEEK...
- According to Refinitiv data, SPACs did $109bn-worth of transactions globally LAST MONTH (Tuesday) in 50 deals. So far this year, they’ve accounted for over 20% of dealmaking activity.
- Trustpilot announced plans for a £1bn float on the London Stock Exchange (Tuesday), making it the first European company to do so this year.
- Deliveroo announced that it would also be doing an IPO on the London Stock Exchange (Friday) and is seeking out a $10bn valuation. I would argue that the timing is great for the company (it’s continuing to do well under lockdown), but I wonder whether it’s going to be any good for investors given the possibility that it will have difficulty in replicating the stellar growth rates it saw last year.
...AND IN MISCELLANEOUS DEVELOPMENTS...
- In EV news, Volvo committed to electrify its line-up by 2030 (Wednesday), GM is thinking about building a second battery factory in the US (Friday) and Tesla revealed that it has become an adviser on a nickel project (Friday) as part of a deal to secure nickel supplies. Nio complained of continued chip shortages (Wednesday) and car parts manufacturer Valeo said it thought that the shortage would last until at least the summer (Monday)
- In RETAIL news, Sainsbury’s announced cuts at HQ and a shutdown of its online fulfilment centre in East London (Thursday) in order to save on costs and concentrate spend on improving its food ranges, the latest figures from Kantar showed that Aldi and Lidl showed that both supermarkets lost market share for the first time in over ten years (Wednesday) and, this week, Morrisons dropped out of the FTSE100 (Thursday). In its latest bid to change, John Lewis announced that there would be “mini-John Lewises” in branches of Waitrose (Monday), Amazon opened its first cashierless shop in the UK (Thursday) and, over in the States, Disney announced the closure of 60 stores (Thursday).
- In UK CONSUMER NEWS, the latest Bank of England figures showed that household savings continue to increase (Tuesday), the Entertainment Retailers Association says we are spending record amounts on fun and games (Wednesday) and Nationwide says house prices are rising (Wednesday). Given the latter, banks aren’t wanting to be left behind so the UK’s five biggest banks have agreed to support a new government scheme that will help first-time buyers onto the property ladder by offering 95% mortgages (Thursday).
- In SOCIAL MEDIA NEWS, Twitter announced it would clamp down on users who spread false news about the coronavirus and vaccines (Tuesday) in an attempt to contain the spread of harmful content and Google said that it would be curtailing the tracking of web users from 2022 (Thursday), making it more difficult for advertisers to pinpoint their audiences.
AND IN UPDATES FOR WATSON'S YEARLY...
- Watson’s Yearly updates: These will be left until the next edition of Watson’s Yearly that will be published shortly
I thought I’d leave you this week with two food stories – the weird “recipe” in Man turns flour into ‘shredded chicken’ and confused viewers have no words (The Mirror, Paige Holland) – and something for dessert in ‘I played cupcake roulette with Deliveroo and my face says it all’ (The Mirror, Courtney Pochin). Nice 👍