Watson’s Weekly 08-02-2020

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.


  • The doctor who initially raised the alarm over the coronavirus, Li Wenliang, died (Friday). He had initially been accused by Chinese authorities of “rumour-mongering” and they forced him to retract his statement, but unfortunately he was proved to be right after all. In the meantime, Hong Kong closed access to China (Tuesday) and travelers around the world faced more restrictions
  • China poured £130bn into the market in order to stop a complete rout (Monday) on the first day of trading since the lunar new year holiday and although markets rallied on hopes of a vaccine (Thursday), oil prices fell (Tuesdayon fears that China demand would fall through the floor. OPEC’s advisory body, which met for three days this week in Vienna, recommended that oil production should be cut by a chunky 2.7m barrels a day for the first half of 2020 to avert prolonged major oil price weakness in the aftermath of the coronavirus. The OPEC+ alliance (which comprises of OPEC members plus another group, led by Russia) had already agreed to make cuts of 1.7m barrels per day for the first three months of this year, but clearly those plans were made pre-virus. Companies also examined their insurance policies (Monday) to see whether they were covered for epidemics
  • Other than that, this exposed the reliance of supply chains on China (Tuesday) as car manufacturers and tech companies suffered in particular and some US and European car makers warned of plant closures (Wednesday) due to lack of China-made parts


  • Tesla’s share price shot up (Wednesday) and fell off a cliff (Thursday) as investors continud to put their hopes in Elon Musk (and take profits). The Panasonic/Tesla joint venture became profitable (Tuesday) after six years of not being!
  • It looks like it may be a good time to buy a hybrid (Monday) as manufacturers need to sell more of them to avoid EU fines on carbon emissions. Those most likely to fall short of these  include Mercedes-Benz, Renault, Fiat Chrysler and Jaguar Land Rover. Mind you, Boris Johnson brought forward the deadline for sales of petrol and diesel-powered cars from 2040 to 2035 (Wednesday) and – controversially – included hybrids. Online interest in electric vehicles increased as searches were up by 162% (Thursday) versus the average
  • Elsewhere, there’s speculation that Nissan has an interesting hard Brexit plan (Monday). It is allegedly going to go completely against the flow and increase production in the UK and close its facilities in Barcelona and France in a move to increase its market share from 4% to 20%! The company has, however, denied the existence of such a plan – but it does sound quite interesting, no?


  • Sports brands seem to be getting more powerful than retailers (Monday) as some of the big sports brands are tending to use their own websites and stores to distribute their product to the public in preference to traditional retailers. Talking about sportswear companies, Nike’s Vaporfly wonder-shoe got the thumbs up from World Athletics (Thursday) and it also got approval for the Air Zoom Alphafly, a prototype of which was the shoe used by Eliud Kipchoge to to beat the 2-hour marathon mark. All the other companies will be racing to provide their athletes with something similar (although that’s going to be difficult time-wise because they need to make the shoe available on the open market by April 30th to be eligible for use in the Olympics)
  • Ghost kitchens are taking up empty retail space (Monday) as real estate is repurposed to adapt to changing consumer tastes
  • More retailers announced stores announced closures this week. Macy’s said it would be cutting about 20% of its outlets over the next five years (Wednesday) in an effort to move with the times and Ikea said it would shut its Coventry store in the UK (Wednesday) as part of its overall plans to change its model from “big box” out-of-town stores to having smaller ones in city centres
  • Spotify continued in its efforts to broaden its offering (Thursday) buy buying another podcast specialist, The Ringer, for an undisclosed sum. This follows on from last year’s purchases of Gimlet and Anchor, as Spotify wants to attract more and retain existing users in the face of continued competition from Apple and Amazon’s music apps
  • The latest stats from Kantar show some interesting trends as sales of no-alcohol and low-alcohol beer surged by 37% in January (Wednesday), with demand for adult soft drinks rose by 3%. Euromonitor analysts have pointed out that UK sales of no-alcohol and low-alcohol beer have doubled over the last four years. On the food front, Veganuary has also grown in popularity and helped sales of meat substitutes like soya mince and veggie burgers. The meatless revolution continues!


  • In the “Country-by-country” section, in the US, the Senate acquitted President Trump over allegations that he pressured Ukraine into digging up dirt on a political opponent, effectively ending the process that has dragged on for the last few months. The two charges were on his abuse of power and the obstruction of Congress. Fun fact: Trump has become the first ever president to run for re-election having been impeached. In Russia, new PM Mikhail Mishustin has promised to bring in changes to the country’s 2020 budget to increase government spending by up to 10% in order to boost economic growth. In Brazil, Bolsonaro’s government said it will present a bill to Congress that would open up indigenous land to hydroelectric and mining projects, arguing that an opening up of the Amazon is key to tackling poverty. This will no doubt cause uproar both at home and abroad, but Bolsonaro argues that a lot of the currently protected land has a huge amount of mineral resources.In Turkey, President Erdogan has promised revenge on Syria following the death of eight Turkish soldiers and accused Russia (Syria’s most important ally) of turning a blind eye. Turkey’s relationship with Russia has been a tricky one given that they are on opposing sides in Syria, but they need Russia more than Russia needs Turkey, so they will probably sort things out. In the UK, Brexit has strengthened Scotland’s claim for independence on the one hand, but exposed its stark financial weaknesses on the other. Donald Tusk, former EC president, stirred things up by saying that Brussels would be keen for Scotland applying to join the EU but it isn’t a given and it’s also not clear as to whether the sums would actually add up, especially when you consider that Scottish exports to the rest of the UK are over triple those that go to the EU. In 2018, 60% of Scottish exports went to the rest of the UK, over 19% to the EU and over 20% to the rest of the world. Separation negotiations are likely to be highly complicated. Elsewhere, property prices continue to climb post last year’s General Election in a “Boris bounce”, especially in London…


My absolute favourite “alternative” story this week featured the seriously spooky talents of this South Korean lady: Makeup artist blends into backgrounds by painting mind-bending optical illusions onto her FACE (Daily Mail, https://tinyurl.com/qp6aomt). Mind-bendingly good!