Watson’s Weekly 13-12-2025

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 COLOURED HIGHLIGHT 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.

IN WAR NEWS…

• Trump gave Zelenskyy his latest ultimatum – that the Ukraine leader is going to have to accept territorial losses in exchange for some vague US security guarantees to get a peace deal done “by Christmas”.
• Thailand launched air strikes on Cambodia following border clashes that resulted in the death of a Thai soldier. This is another example of another failed Trump “truce” where he tried to bring an end to fighting between the two countries back in July.

IN TRUMP THINGS…

• Trump unveiled a $12bn bailout for farmers via the Farmer Bridge Assistance programme, with pay outs to be made from the end of February. Soybean farmers have been suffering from a combination of low crop prices, high production costs and the loss of trade markets – particularly China, which just stopped importing US soybeans completely in response to Trump’s trade tariffs.
• Trump signed an executive order to withhold funds from states that impose strict laws on AI tools. Tech groups have been pushing to have a single federal rule book so this will help their cause. His administration has twice failed to get measures past Congress to restrict states from writing their own AI rules.
• Trump also signed an executive order to “increase oversight” of two proxy advisers, ISS and Glass Lewis, who advise on how pension funds and some other money managers should vote when there is a shareholder vote. The president says that they “regularly use their substantial power to advance and prioritise radical politically-motivated agendas”.
• Trump went on the campaign trail this week and held a rally where he blamed the Democrats for high prices and inflation and then insisted that “prices are coming down tremendously from the highest prices in the history of our country”. I think that there’s only so much time that he can keep saying this and people believe him. If their weekly shop continues to be pricey they are just going to ignore his protestations – so he really needs prices to fall (which is presumably why he’s signed specific deals with specific countries for specific things).

IN REGIONAL/INDIVIDUAL COUNTRY NEWS…

IN THE AMERICAS…

• IN THE US – the Fed cut interest rates by 0.25 percentage points, as per market expectations, but it was the most divided committee decision since 2019. Trump got more good news this week as the US trade deficit shrank by more than expected in September, implying that net exports helped power economic growth in Q3. However, some have said that people shouldn’t get too excited because of the big jump in gold bullion exports – so they reflect a one-off rather than an overall trend. Meanwhile, the Department of Homeland Security has proposed measures that will require citizens of countries including the UK and France to disclose the past five years of their social media history in order to visit the US as a “mandatory data element”. Surely this will result in a major drop in visitors to the US…
• IN MEXICO – the country has decided to impose up to 50% taxes on imports of Chinese cars and other goods as America’s neighbour falls in line with Trump’s protectionist policies. The current import tariffs range from 15 to 20% and Chinese imports account for about 20% of all Mexican imports so this could get tricky…

IN ASIA…

• IN CHINA – China’s trade surplus breached $1tn for the first time, according to the latest official data from China’s customs administration. This not only highlights the strength of China’s industrial strategy, it also highlight the weaknesses – that it’s having to rely on overseas demand because domestic demand is still weak.

IN EUROPE…

• IN FRANCE – PM Lecornu managed to push through the government’s social security budget with a narrow majority, a major victory for the embattled PM. This takes him a step closer to getting a state budget by the end of the year. Concessions had to be made, though!
• IN THE UK – Bank of England forecasts show that policies announced in the budget would reduce annual inflation by 0.4 – 0.5 percentage points for a year from mid-2026. This sounds like a bit of rare good news for the chancellor and came courtesy of removing green subsidies from household energy bills and freezing fuel duty for motorists.

IN COMMODITIES NEWS…

• SILVER – the silver price surged above $60 per ounce for the first time thanks to a combination of limited supply and rising demand from industrial users and investors. The price has more than doubled since January!

IN ENERGY NEWS…

• WIND POWER – A Massachusetts district court judge decided this week that January’s executive order to freeze approval of offshore wind energy projects should be struck down as the measure was “arbitrary and capricious and contrary to law”. I suspect that Trump’s team will appeal!
• THE GRID – Back in the UK, the National Energy System Operator (NESO) unveiled the results of an overhaul of the queue of projects to access our electricity grid this week. The chosen ones were prioritised for their readiness to build and how much closer they will get the government to their goals of decarbonising by 2030.

IN CRYPTO NEWS…

• The world’s biggest bitcoin hoarder, Strategy, is now getting so desperate that it’s considering something that it vowed it would not do – sell some of its 650,000 bitcoins! Strategy’s chief even posted words of wisdom on X in February this year “Never sell your bitcoin”. Bitcoin’s ongoing weakness has forced him to eat his words.

IN INVESTMENT TRENDS…

• IN MARKETS – the Bank for International Settlements (BIS – aka “the central bank of central banks”) said that retail investors could be behind recent price rises in US shares and gold. The gold price has increased by a whopping 60% so far this year and the S&P 500 is up by almost 17%. Institutional investors have been taking money out while retail investors have been putting money in – but the problem is that retail investors tend to be flakey, which means that upward and downward movements can be magnified. Meanwhile, the S&P500 closed at a record-breaking high this week thanks to the boom in consumer-focused and financials companies more than mitigating the sell-off in Oracle and other tech companies.
• IN IPOs – the demerged ice cream business of Unilever, Magnum Ice Cream Company floated in Amsterdam this week, but it turned out to be a bit of a damp squib. The old owners of the Ben & Jerry brand, Ben and Jerry, continue to complain about Unilever abandoning its social mission but the new CEO said that they should just “hand over to a new generation”. Ben & Jerry sold their ice cream business off for $326m in 2000, so it does seem that they’re being somewhat hypocritical but hey. Surely if they cared that much, they shouldn’t have sold it off to a massive international conglomerate for hundreds of millions of dollars…
• IN POTENTIAL IPO NEWS – SpaceX is thinking about launching a $1.5tn listing next year but it’s just one of a number of massive privately-owned companies that could have IPOs next year. It’s potentially looking to be an absolutely huge year next year for everyone in the IPO food chain what with SpaceX, OpenAI and Anthropic all looking to float.
• IN M&A NEWS – this week was all about the takeover of Warner Bros Discovery – initially by Netflix for cash and shares and then Paramount Skydance, which launched a higher all-cash offer for the whole business. Trump highlighted misgivings about a takeover by Netflix due to market share issues but then complained about CNN, which is owned by Paramount for putting out a TV programme he didn’t like. Some critics don’t like the deal because of all the Saudi Arabian money being used to finance it and some are saying that this deal could signify the top of the market and that we are on the cusp of a bursting bubble. At the moment, the Paramount option looks like the more Hollywood-friendly bid but the financing remains controversial.

IN BUSINESS TRENDS NEWS…

• The Budweiser Brewing Group opened its second European de-alcoholisation facility at Magor in Wales last week. For the first time, alcohol-free brands including Corona Cero and Stella Artois 0.0 will be brewed in Britain rather then shipped in from Belgium. This would suggest that beverage companies really do believe that the no-alcohol culture movement is permanent, and not a fad.
• The EU has now declared that new drugs will only get nine years of market exclusivity rather than ten, meaning that cheaper generic versions will be available a year earlier than they are now. Pharmaceuticals companies are none too happy about this because drug development is insanely expensive and it will give a shorter window within which to recoup their development costs and make money.
• The latest data from the BRC and KPMG showed that this year’s Black Friday was underwhelming as consumers remained nervous while research from Barclays found that they were planning on drinking less and buying less this festive season.
• In hospitality, it seems that restaurants are offering fewer two-course Christmas meals this year as a way of enticing customers to pay more. About 20% of restaurants have quietly removed the option, according to industry analysts Meaningful Vision. Others, including Turtle Bay and Wahaca have removed free drinks offers. On the other hand, UK pubs – including the likes of Fuller’s, Young’s and Marston’s – have all reported bookings well ahead of last year in recent trading updates. This is good to hear ahead of “dry January”…

IN EMPLOYMENT TRENDS…

• IN THE US – The latest Job Openings and Labor Turnover (JOLT) report showed that US job openings hit their highest level in October. This takes some of the pressure off the need to cut rates.
• IN THE UK – a report from PwC showed that Britain’s youth unemployment is rising at the fastest pace in the G7 as graduate hiring is falling and the squeeze on the retail industry is also resulting in fewer vacancies. The government is facing push-back in the House of Lords against the massive upgrade of unions’ and workers’ rights in the proposed employment rights bill but UK employers are now less inclined to advertise salaries or offer incentives against the backdrop of a slower labour market because they now have more of the power.

IN CONSUMER TRENDS…

• IN THE US – Atlanta Federal Reserve analysis of Bureau of Labor Statistics data shows that, after enjoying years of above-trend pay growth, America’s lowest paid are seeing their wages slow down more sharply than for those on the highest pay. Rising prices continue to make things worse, particularly for the non-affluent.
• IN THE UK – Britons are paying more income tax than the French, according to the latest OECD research. Perhaps that explains why households have cut their spending at the steepest rate since the pandemic!

IN RETAIL NEWS…

• Kroger paid Ocado $350m in compensation for cutting back on the number of automated distribution centres it runs with them. This was more than the $250m expected, so Ocado’s share price boomed by up to 16% at one point.
• The latest data from Worldpanel showed that Asda’s sales fell as well as its market share over the last quarter.  It was the only supermarket to see sales drop over the quarter and it looks likely to repeat the performance of last year where it was the worst performer among supermarkets. There don’t seem to be any signs of recovery here! After a disastrous period of ownership under the Issa brothers and TDR Capital, if the Asda saviour of yesteryear, Allan Leighton, decides he’s had enough (or gets kicked out) this company’s going to go to zero IMO.
• Talking of people getting kicked out, Lululemon’s CEO Calvin McDonald is set to leave next month thanks to the founder wanting to take drastic action to reverse the brand’s “loss of cool”. There’s not much detail as to what’s going to happen going forward…

IN LEISURE NEWS…

• Leon is going to shut 20 of its 70 restaurants and cut jobs after co-founder John Vincent bought the company back in October. Vincent blamed the situation on high taxes and the mismanagement of the former owners, the Issa brothers – the ones who also managed to run Asda into the ground.
• William Hill owner, Evoke, is looking at a sale or break-up of the business following a warning of a £135m hit from tax increases in last month’s Budget. Sounds like a decent idea considering that high street gambling is dying in the UK – but who’s going to buy it? It might have to sell out at fire sale prices just to get rid.

IN TECH NEWS…

• Google DeepMind is going to build its first “automated science laboratory” in the UK in partnership with the UK government next year. The lab’s focus will be on using AI tools to develop new materials for superconductors.
• Oracle’s shares fell a lot this week (the share price has fallen by over 30% since September) thanks to rising anxiety from investors about the massive amounts it is spending on building out datacentre infrastructure.
• IN AI-USAGE – research by PwC showed that around 25% of British consumers are already using AI to find the right products and this trend is especially marked among younger people, according to separate research by KPMG. Companies are having to rethink their SEO strategies and find out how they can appeal to AI bots to get recommended.
• IN DATA CENTRES – the EU is looking at granting datacentres, AI gigafactories and affordable housing exemptions from mandatory environmental impact assessments as the European Commission continues to walk back its green rules. The idea is to cut red tape and improve labour mobility.
• IN CHIP NEWS – Nvidia got the go ahead to sell H200 chips “to approved customers in China”, but Trump said that the US will take a 25% cut of the revenues for allowing it. Having said that, Chinese regulators said that they will only allow limited access to Nvidia’s supplies of its H200 chip, probably making buyers go through an approval process to get them. They want domestic producers to level up their game and the Ministry of Industry and Information Technology recently added AI processors from the likes of Huawei and Cambricon to its government-approved list of suppliers. Meanwhile, a Chinese challenger to Nvidia, Moore Threads, surged by a startling 425% on its market debut last week! It floated on Shanghai’s tech-focused Star Market in the second biggest mainland IPO this year. How long it will take to close the gap with Nvidia is anyone’s guess. Elsewhere, Broadcom saw decent revenue growth thanks to ongoing strong demand for its chips that are used in data centres but its shares were sold off as forecasts weren’t as good as investors had been expecting.
• IN HACKING – there’s been a lot of fuss about the hacking of “South Korea’s Amazon”, Coupang. The personal data of over 33m active and former users was compromised and the incident led to the resignation of its CEO this week. The breach actually began in its servers back in June but it took five months for the country’s biggest retailer by market share to detect it!

IN MEDIA NEWS…

• Disney declared a $1bn investment in OpenAI that will let the platform use its characters and properties to generate short, user-prompted videos via Sora for three years. Sora users will be able to access Mickey Mouse, Elsa and Black Panther – among others – but the likenesses or voices of actors are not included. There are also limits to what the Disney characters will be allowed to do in videos.

IN SOCIAL MEDIA NEWS…

• The social media ban for under-16s in Australia came into force this week. The ban means that under-16s will no longer be able to access apps including Snap, YouTube, X, Facebook and Instagram in an effort to stem the harm that’s being done to the wellbeing of youngsters. The world will be watching! If there are breaches, companies could be liable for fines of up to $33m.
• The latest report from Ofcom’s Online Nation report shows that Millennials (those aged between 35 and 44) are spending less time online, something that’s being interpreted as being a cause for concern about the internet’s impact on mental health. This is the first time Ofcom’s seen a decrease among any age group in online habits outside the post-pandemic period when internet use fell sharply when lockdowns ended.

• Trump’s recent bid to loosen US fuel economy rules is likely to be felt acutely in Europe. Trump says that the rollback will cut prices for buyers by $1,000 but actually what it’s doing is protecting the profitability of petrol trucks and SUVs whilst weakening the hand of EV makers. If Europe and America fall behind on the EV front, Chinese and Korean makers could potentially clear up.
• The UK government is being pressured to reconsider its adherence to the 2030 ban on the sale of new internal combustion engine vehicles as it looks increasingly likely that the 2035 European deadline is going to be pushed back to 2040. If we stick with it, it could potentially result in the UK market getting flooded with cheap Chinese EVs that can’t be sold anywhere else and kill car production in the UK.

• IN REAL ESTATE NEWS – Bank of England data shows that the proportion of home loans made with deposits of less than 10% has risen to 7.4% of all mortgage advances. This is the highest proportion since Q2 of 2008 and is reminiscent of debt levels last seen in the run-up to the disastrous 2007-8 financial crash. Meanwhile, the latest data from Zoopla shows that rents are rising at their slowest pace for four years as the imbalance between supply and demand “has narrowed sharply” over the course of 2025 thanks to cheaper mortgage rates and a “sharp decline in net migration”. In commercial property news, Canary Wharf’s revival is continuing as US payments company Visa has just struck a deal to move its European HQ to Canary Wharf. It will be taking on the lease of 300,000 sq ft of office space on a 15-year deal at One Canada Square. Meanwhile, data from Knight Frank and the London Property Alliance (LPA) shows that 56% of London’s office blocks will be obsolete by 2030 because they probably won’t meet tightening energy efficiency rules. This means that the supply of viable London office space is shrinking.
• IN FINANCIALS NEWS – a number of insurers are lining up to buy Aegon’s UK business. It’s possible that a buyer could swallow the whole thing or it could be broken up and sold off separately. Aegon’s asset management arm, however, won’t be affected. Elsewhere, US broker Robinhood has agreed to buy two Indonesian businesses – brokerage Capital Sekuritas and crypto trader Pedagang Aset Kripto – to gain access to one of Asia’s fastest-growing markets with over 19m retail investors – over half of whom are under the age of 30.

My favourite video of the week was the one with the man talking to his dog 😍!