Watson’s Weekly 20-09-2025

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…

• Russia flew a drone over Romanian airspace this week (it was Poland last week – but there were many more on that occasion). Unlike with the Poles, there was no shooting down. Clearly the Russians are just trying out NATO defences.
• On the other side, Russians have been losing internet access thanks to Ukrainian drone attacks. This has disrupted consumers, companies and public services. The blackouts have lasted anything from a few hours to a few weeks over the summer.

IN TRUMP NEWS…

• Trump continued in his efforts to get Fed governor Lisa Cook sacked but the appeals court didn’t let him get his way on this occasion and she was able to take part in the rate-setting meeting this week. Still, Trump’s now taking it to the Supreme Court.
• The Supreme Court said that it will hear the arguments about the legality of the liberation day tariffs on November 5th. It’s good that this has been fast-tracked because it will give some certainty – but the problem is that Trump’s team is already looking at ways around a decision if things don’t go their way.

IN INDIVIDUAL COUNTRY NEWS…

• IN THE US – the Fed cut interest rates by 0.25 percentage points, not the 0.5 percentage point cut that Trump had hoped for. This cut was voted for by 11 of the 12 members of the committee.
• IN CHINA – official figures showed that retail sales and factory output grew at their slowest pace this year. Moody’s Analytics said this was down to a combination of Beijing’s clampdown on production overcapacity and the fading away of the export frenzy when everyone was trying to beat the US tariffs.
• IN THE UK – the government’s approval rating of 20% is a full 10% behind Reform and MPs reckon Starmer’s got until May local elections next year to turn things around or he’ll be out. UK inflation held steady at 3.8% and the Bank of England kept interest rates unchanged at 4%. but the latest ONS figures showed that UK government borrowing for the first five months of the fiscal year was way more than the OBR had been expecting. It looks increasingly like we’re going to be facing some serious tax rises in the autumn Budget. Actually, on the subject of tax, rather than just concentrate on wealth taxes (which arguably won’t raise all that much anyway) there were some interesting alternative solutions suggested – like reforming inheritance, capital gains and land taxes. Stamp Duty could be based on updated parameters and corporation tax needs to be streamlined while employee national insurance could be rolled into income tax. VAT could be simplified, freeing up money to be used to target those who actually need it.

IN ENERGY NEWS…

• A US-UK energy accord was signed before Trump landed for his state visit which involved a number of deals for SMRs worth about $100bn, including one between Centrica and X-Energy.

IN CRYPTO NEWS…

• We saw that the FCA is thinking about loosening compliance requirements for crypto firms, the main effect being that they won’t have to deliver “good outcomes” for retail clients. At the moment, this extra layer of protection is given to retail clients. The FCA takes on oversight of the crypto industry next year (at last!).

IN BUSINESS TRENDS…

• IN REGULATION – Trump’s new appointee to the SEC, Paul Atkins, signalled that he’s going to take a lighter touch regarding enforcement versus his predecessor, Gary Gensler. He said that he will be giving business notice of any technical violations rather than “bash down their door” unannounced. The SEC’s job is to protect US investors but Atkins definitely seems to be keen to make it more business-friendly. In addition to this, he signalled that companies will be allowed to be quoted on public markets even if they ban shareholders from filing class-action lawsuits. This is another move by the SEC to make compliance less onerous for companies.
• ON REPORTING – Trump called for US companies to ditch quarterly reporting, instead opting for reporting twice a year. He said it will help companies save cash and let execs focus more on their businesses. The UK stopped quarterly reporting over ten years ago and is often used as an example of how it can work. The EU and Singapore are other examples of how it can work as well. I don’t really believe that switching from quarterly to half-yearly reporting makes companies have a longer term outlook – I just think it’s one less thing to have to do and gives the companies a bit of breathing space.
• EU companies are still getting hit by bottlenecks on rare earth supplies from China – and this is despite an apparent agreement reached two months ago between the EU and China to address this issue.
• Big brands including Coca-Cola, McDonald’s and Procter & Gamble look like they’ve been de-emphasising their American-ness and re-emphasising their local credentials in their latest ad campaigns. This is a shift from decades of doing the opposite and is a reaction to rising negative perceptions of America.

IN INVESTMENT NEWS/TRENDS…

• IN MARKETS – Are we approaching a stock market crash? There are similarities between what’s happening now and what happened at the end of the 90s in the dotcom crash, with AI and crypto companies taking the place of the dotcoms. FWIW, barring any other surprises I think that the most likely time for there to be a crash is if Trump puts in a disappointing performance in the midterm elections at the end of next year. He’s so tied in to so many things (like crypto, tech etc.) that I think a poor showing could really spook investors (and corporates). Meanwhile Robinhood announced that it was going to offer retail investors a slice of a “concentrated portfolio” of unlisted start-ups! Risks will be way higher, but the hope is that the returns could be stellar. ARK Invest and Pulsar Group led a $300m investment in Brera Holdings, a company that has until now owned stakes in various football teams. The company announced that would be buying up solana tokens – news of which sent Brera’s share price up by almost 200%. The company will change its name to Solmate. This is another example of a company deciding to become more of a crypto asset treasury. Back home, UK stocks are being sold of at the fastest pace in 20 years as investors fear the worst in the upcoming Budget. On a positive note, the LSE became the first major exchange in the world to launch a complete blockchain-powered trading system. It completed its first transaction using this system this week!
• IN IPOs – StubHub floated in the US this week but its debut was underwhelming as the share price fell by 6.6% even though it went for a middle-of-the-range valuation. Security company Verisure announced plans for an IPO in Stockholm, which some see as an early sign of the opening up of the European markets. It will no doubt be monitored very closely!
• IN M&A – US investment bank Jefferies agreed to Japan’s SMFG raising its stake to 20%. SMFG bought a 5% stake back in 2021 and raised it to around 2023. This sounds very similar to what MUFG did with Morgan Stanley in the aftermath of the financial crisis. Elsewhere, co-founder of Deliveroo, Will Shu, is going to step down the moment DoorDash’s acquisition of the company completes next month. It’ll be the end of an era! DoorDash announced in April that it would buy Deliveroo for £2.7bn.

IN EMPLOYMENT TRENDS…

• US companies have slowed hiring down significantly since Trump’s tariffs hit – and in some cases, they are cutting headcount.
• In the UK, bosses say that they can’t afford bigger pay rises because of inflation, something that was echoed by the latest figures from the ONS which showed that UK jobs and pay growth are losing momentum.

IN CONSUMER TRENDS…

• The Food and Drink Federation warned that food and drink prices are going to rise faster largely thanks to rising production costs, which will be bad news for consumers who are already under pressure. This trend was echoed when Aldi warned that food prices will rise if Rachel Reeves continues to increase costs for employers
• Research from GfK shows that Britons are planning to save less as interest rates fall and perhaps because they’re feeling more of a need to keep money back to pay for expected price rises. Overall consumer confidence is also wavering at the moment.
• It’s good to be a rich kid at the moment as wealthy parents are rushing to give them assets before expected rises in Inheritance Tax come in.
• It seems that the surge in pet and pet goods buying has really slowed down as Pets at Home saw a big sales drop which prompted a profit warning and the sudden departure of its CEO. This is presumably largely due to more people returning to offices.

IN REAL ESTATE NEWS…

• IN RESIDENTIAL – Rightmove data showed that house prices fell for the first time since January last year. Some of this will be because of the higher number of homes being listed, but some of this will be because potential buyers are staying away until we know more about what the Budget will bring. Barclays data says that it’s becoming more common for buyers to avoid the first rung of the ladder and go straight to their “forever home” as semi-detached properties attracted more first time buyers than flats over the August period. Meanwhile, it’s bad news for renters because landlords are selling in increasing numbers so as not to get hit by expected tax rises in the autumn Budget according to the latest data from Hamptons.
• IN CONSTRUCTION – Britain’s biggest housebuilder, Barratt Redrow announced a decent performance for the year but it was cautious about the year to come because of high inflation, a cooling jobs market and sluggishness in the economy. This was the first set of full-year results from the company that bought Redrow last October.

IN RETAIL NEWS…

• Trump’s tariffs and the end of the de minimis rule mean that a new phenomenon is emerging – that of the delayed import tax bill! This can be a nasty and unwelcome surprise and could well start to hit orders of products that come from overseas. Meanwhile, shares in Pop Mart, the company behind the Labubu dolls, dropped by their sharpest rate since April on fears that the dolls’ popularity has reached its peak. Indeed, the waning in popularity of these dolls is the biggest danger – not rivals copying their idea.
• Temu’s UK operations managed to double revenues and pre-tax profits over the year as cash-strapped Brits bought up their cheap products.
• A potential sale of Argos to JD.com was abandoned as neither JD.com nor Argos’s owner Sainsbury’s had been able to agree on a suitable price. Will this draw other potential bidders for Argos, I wonder??

IN TECH NEWS…

• IN CHIP NEWS – China banned tech companies from buying Nvidia’s AI chips. Companies including ByteDance and Alibaba have been told to end their testing and orders of the Nvidia chip that has been specifically designed to be supplied to China. Domestically-made chips are deemed to be on a par with the more basic chips in the Nvidia range and China’s trying to wean itself off American tech. Nvidia announced that it would invest $5bn in Intel to develop chips for PCs and data centres. Intel’s share price rocketed up by 23% on the news and it comes just a month after the US government agreed to take a 10% stake in Intel. Meanwhile, China’s leading chip producer, SMIC, is conducting trials on the country’s first domestically manufactured chipmaking equipment made by Yuliangsheng.
• IN QUANTUM COMPUTING NEWS – UK start-up Quantum Motion built the world’s first quantum computer using the same silicon chip tech used in laptops and phones! It’s now going to be tested at the UK’s National Quantum Computing Centre (NQCC) in Oxfordshire where researchers will look at how it could help to save real-world problems like designing new medicines, for example. Then we saw that the Genesis quantum computer, made by Oxford Quantum Circuits, is helping to power New York’s first ever combined quantum-AI data centre that will formally open next week. It will be used initially to help Wall Street banks address fraud
• IN HARDWARE NEWS – Meta is struggling to cut out Chinese suppliers like Goertek from its supply chain. Goertek makes Meta’s VR Quest headsets and its popular Ray-Ban smart glasses. Talking of which, Zuck unveiled Meta’s latest gadgetry this week, which included the launch of Meta’s first smart glasses with a built-in screen as well as improved versions of its existing Ray-Ban Meta line-up. Elsewhere, China’s flying car start-ups, including EHang, are making progress. This company became the first company in the world to get approval from its national regulator to carry passengers – in unmanned flights – on tourist routes!
• IN SOFTWARE NEWS – Google’s parent company, Alphabet, hit a $3tn valuation this week – a level only hit by Nvidia, Microsoft and Apple – so this is a major moment. It continues to surf the AI wave but also got a recent boost from the less-strict-than-expected court ruling on whether it had created an illegal monopoly in online search.

IN MEDIA NEWS…

• Disney cancelled Jimmy Kimmel’s evening show for what he said about Charlie Kirk. It seems like we’re seeing a trend forming after Stephen Colbert’s show was cancelled for remarks that caused offence. It is getting increasingly difficult for anyone who does not conform to the MAGA agenda to get a platform to express their views.
• Sky announced a headcount reduction of 900 out of its 23,000 UK employees. This is in addition to the 3,500 who have already been cut over the last 18 months. It’s all part of the transitioning of the business to streaming. Talking of which…
• IN STREAMING – Amazon announced that it would be launching augmented reality football coverage, a service called Prime Vision. The idea is to get more engagement, especially from younger people, by almost gamifying the experience with extra graphics and options. Although it sounds a bit gimmicky, they’ve used it with NFL coverage in the States and it’s proved to be successful.
• IN SOCIAL MEDIA NEWS – the US and China are getting ever closer to a deal on the transfer of ownership of TikTok. More details are being hammered out but Beijing says that the US app will use the Chinese algo, which is interesting – because this is the app’s “secret sauce”!

IN EV NEWS…

• Tesla shares had a nice uptick thanks to news that Musk had bought $1bn worth of the company’s shares last week. On the flipside, Tesla is now being investigated by the NHTSA amid allegations that its electric door handles have been trapping children in Model Y cars.
• Rivian is going right ahead with building a Georgia factory despite the continued de-emphasis of the importance of EVs in this administration’s policies.

IN DRIVERESS NEWS…

• The biggest sensor maker in the world for self-driving cars, China’s Hesai, made the surprising statement this week that the world was not yet ready for fully driverless cars because regulators are currently unable to deal with deaths that are caused by them.

GSK announced plans to invest $30bn into R&D and its supply chain in America over the next five years as it tries to show the White House that it’s doing something in response to Trump’s constant criticism.

Novo Nordisk got some welcome good news this week that the pill version of its weight-loss drug is as effective as its existing injectable version – and the company’s share price rose by over 6% in response!

There’s no competition as far as I’m concerned about the winner of this week’s video – it’s the one with the puppy! 😍😍😍