Watson’s Weekly 06-11-2021

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.



There was a lot of comment on CLIMATE as the COP26 conference kicked off in Glasgow…

  • India PM Narendra Modi’s commitment to an emissions target (Tuesday) to cut emissions to net zero by 2070 was applauded but, let’s face it, it’s laughable given that it is so far away! India is the world’s third worst polluter but did add that it aims to get half of its energy from renewables by the end of this decade. Notably, US and China made ZERO promises!
  • The UK government faces a North Sea dilemma (Wednesday) as the government’s Oil and Gas Authority is going to have to rule on whether Shell and Siccar Point Energy will be allowed to start drilling in the Cambo oilfield 80 miles north-west of the Shetland Islands. The decision is expected to be made by the end of the year. If it allows the drilling, it will look like BoJo made empty promises on the environment, but if it doesn’t, the UK’s energy situation could potentially get worse…
  • Banks came under scrutiny about their green promises (Wednesday) given that they talk about being kind to the environment on the one hand and then lend to the fossil fuel industry on the other. Scrutiny over lending has increased ahead of COP26 leaving the likes of Barclays, Deutsche and BNY Mellon open to criticism for having such double standards.
  • Industry is calling for commitment to energy storage (Thursday) as some of the world’s biggest energy and engineering companies got together to form the Long Duration Energy Storage Council this week. They were calling for up to $3tn of investment into long duration energy storage, which will clearly be able to go some way towards smoothing out the volatility of renewable energy supply.
  • Indonesia threw a spanner in the works by having second thoughts about the agreement it signed up to (Friday), which had been signed this week by over 100 world leaders to stop cutting down forests by 2030. Also, the IEA warned that the goals of the Paris accord on global warming were potentially unattainable (Friday) as the US and China both countries swerved the UK’s flagship coal pact
  • Meanwhile, Coal miners are doing very well at the moment (Thursday) as rising coal prices have resulted in miners like Thungela Resources (a Johannesburg-based miner which demerged from FTSE100 company Anglo American in June) seeing their share prices skyrocket. Glencore, Peabody Energy, Whitehaven Coal and Exxaro Resources are among the thermal coal miners to have benefited from strong demand for their product, especially from Asia.

There was also a lot of speculation on interest rates given ongoing inflation around the world…

  • The US and Europe dismissed interest rate speculation (Thursday) and the UK looked like it was on the cusp of increasing interest rates (Thursday), but it didn’t pull the trigger in the end (Friday). Mind you, ONS stats say furlough has only resulted in 6% of staff leaving their jobs and the latest figures from the Recruitment and Employment Confederation and KPMG show that starting pay is seeing its steepest increase since the survey began in 1997! This will continue to keep the pressure on the Bank of England to raise rates…

In Asia…

  • China manufacturing slowed down (Monday) for the second consecutive month. The National Bureau of Statistics’ Purchasing Managers Index figures just reflect the cumulative effect of the property sector clampdown and energy shortages against a backdrop of rising commodity prices
  • What’s currently going on at HNA presents a potential template for an Evergrande restructure (Tuesday). HNA used to be China’s most aggressive offshore dealmaker but investigations into its heavily-leveraged acquisitions and opaque ownership structure struck alarm bells with the state, which is now going to implement a streamlining of its structure and take more control. Something similar could be used to “rehabilitate” Evergrande.
  • We also saw Japan’s LDP wins the election (Monday), which isn’t exactly a surprise as the party has been in power pretty much continuously since WWII.

There were also some interesting developments in oil and crypto

  • Saudi Aramco’s valuation climbed above $2tn (Monday), thanks to ongoing strong demand for oil.
  • …and in crypto, Bitcoin’s rise has prompted increased hiring activity in crypto-related jobs (Tuesday) as companies seem to be desperate to recruit staff with the requisite crypto know-how!


  • Maersk warned that supply chain problems will persist (Wednesday) whilst also announcing its best ever quarterly results (!). Ongoing labour shortages and skyrocketing freight rates don’t look like ending any time soon. In the meantime, US warehouses are running out of space (Monday), exacerbating the whole thing!
  • Qualcomm is benefitting from chip shortages (Thursday) and posted record quarterly sales.
  • Apple is having delays and having to prioritise iPhones over iPads (Wednesday) due to chip shortages.
  • Ikea and Next are warning that supply chain restrictions mean they can’t take full advantage of underlying demand (Thursday) and Next announced a downbeat outlook for the final quarter.
  • Meanwhile, some secondhand cars in the UK are selling for more than new (Monday), so for example a Dacia Sandero with 10,000 miles on the clock will set you back £11,700 on average despite the fact that it costs about £1,901 more than it would cost you to buy it new! How amazing is this??


  • TikTok’s owner, ByteDance, restructured into six divisions (Wednesday) making the business lines clearer.
  • It turns out that Snap/Facebook/Twitter lost $10bn in ad revenues thanks to iPhone’s new privacy rules (Monday). Facebook has been particularly badly affected by the changes, but Alphabet and Twitter have not suffered quite as much while Apple, funnily enough, recently posted a “record” quarter for its advertising business!
  • Facebook announced that it was ditching facial recognition (Wednesday) but Facebook and Instagram had yet another outage (Thursday) – the third in a month 😱.


  • First class air travel is making a return (Monday), according to the latest IATA data, although it’s recovering more slowly than economy class travel.
  • Lufthansa returned to profit (Thursday) for the first time since pandemic lows.
  • Budget airlines are facing headwinds (Friday) after posting profitable quarters, with Wizz Air lowering fares to tempt passengers in what is usually a quiet quarter and Ryanair cutting its earnings forecasts.


  • Franklin Templeton made a bolt-on acquisition (Tuesday) of private equity firm Lexington Partners to broaden its offering.
  • Barclays is having leadership turmoil (Tuesday) after the abrupt departure of Jes Staley, following allegations of links with Epstein.
  • Brazilian lender Nubank is aiming for a $50bn valuation (Tuesday) in its upcoming IPO, which would make it one of Latin America’s biggest companies!
  • SocGen’s investment bank comes up trumps (Friday) as it profited from a major uptick in deals in Q3.
  • Metro Bank got a takeover approach (Friday) from US private equity firm Carlyle, which got everyone very excited.
  • Klarna bought Pricerunner (Wednesday), enhancing its functionality with the price comparison site.


  • Allbirds had a strong debut (Thursday), with its share price booming by 95% on its first day on the NASDAQ!
  • Polish locker specialist InPost is to take on Amazon in the UK (Monday) via a major expansion of its parcel locker service.
  • Coke bought the 70% of Body Armor it didn’t already own (Monday), in its ongoing battle with fierce rival in the space, Gatorade.
  • BlackRock offloaded a hefty chunk if its THG holdings (Wednesday), which isn’t great for sentiment in THG.
  • It looks like the UK poultry industry will only use half of the emergency visas allocated to it (Thursday) because farmers have nurtured fewer birds and employed more locals.
  • BTS NFTs are going to be a thing (Friday) as Hybe, BTS’s music label, has agreed a deal to use South Korea’s biggest crypto exchange Upbit, to sell NFTs related to the band, giving them another revenue stream.


  • Watson’s Yearly updates: These will be left until the next edition of Watson’s Yearly that will be published shortly