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. You will need a FULL SUBSCRIPTION to be able to click through all the links which take you to the relevant articles.
THERE WERE SOME INTERESTING MOVES ON THE MACRO AND MARKETS FRONT...
- Investors are starting to get quite excited by the prospect of seeing light at the end of the tunnel for the ongoing US-China trade war as Trump made vague noises about being a bit more flexible on the March 1st deadline (Wednesday) and softened his administration’s hardline stance on Huawei on a recent tweet (Friday). Still, the world’s #1 shipping container company Maersk said that even if the US and China came to an agreement the trade war still wouldn’t end because talks about reforming current agreements with Europe would be next on the agenda (Friday). I would have thought that American negotiators will be in the driving seat in European talks because the Continent will be up to its eyes in Brexit, elections and a general economic slowdown. Funnily enough, although German exports are down (Friday), the German trade surplus remains the biggest in the world (Wednesday), making it a ripe target for Trump to attack when he gets around to it
- Given that tech stocks seem to be in recovery since the beginning of this year, they are starting to crawl back out of the woodwork and dust off previously shelved flotation plans after a nightmare time in the final quarter of 2018. Ride-sharing app Lyft looks like it will float by the end of March (Thursday) and Pinterest could do the same in June (Friday)
THERE WAS SOME BIG DRAMA FOR AUTOMOBILE MAKERS THIS WEEK...
- Honda announced plans to shut its Swindon plant (Tuesday) when the current production run finishes in 2021 putting 3,500 of Honda jobs at risk – but Honda repercussions will be felt outside the company as well (Thursday) as many businesses will have to adapt to this development or experience the consequences
- Brexit is clearly a factor in Honda’s exit, but the whole industry faces problems of tightening emissions regulations (Thursday) and slowing sales – even in the US (Tuesday) where the economy is looking pretty robust at the moment, all things considered
DATA GAVE US A SNAPSHOT OF THE UK CONSUMER AND THERE WERE MIXED FORTUNES FOR RETAILERS...
- So UK consumers are earning more money (Monday) in a tight labour market (Wednesday) and are showing some nerves (Tuesday) but not particularly changing their spending habits (Tuesday) – although they seem to be channeling at least some of it into buying vegan sausage rolls at Greggs that have been flying off the shelves (Wednesday)
- In retailer news, the Competition and Markets Authority pretty much scuppered the chances of the Sainsbury’s and Asda merger (Thursday) with their preliminary findings – but a final report is not due until April 30th. Stores who were hoping to pick up some bargains among the Asda and Sainsbury’s cast-offs will no doubt be disappointed. In the meantime, current Asda owner Walmart unveiled a strong performance (Wednesday) thanks to brisk sales over the holiday period
...AND IN OTHER NEWS...
- Samsung unveiled a bendy phone (Thursday) called the Galaxy Fold. It’s chunky and extremely expensive (around $1,980) but could be the start of a bendy revolution that could boost handset sales if they get the price right
- Apple is working with Goldman Sachs to launch a credit card (Friday). This could boost Apple’s revenues and increase usage of its Wallet function and give Goldman access to younger and more tech-savvy customers whilst also boosting its credentials in retail banking
- Johnson & Johnson received subpoenas from the US Department of Justice and the US Securities and Exchange Commission (Friday) who are investigating allegations of asbestos contamination in its baby powder products. If they are found to have done anything wrong, things could get very nasty (and very expensive) indeed. Think tobacco litigation – but this time for talcum powder
My favourite “alternative” story of this week was Vietnamese hairdresser giving out Trump and Kim cuts (Sky News, Emily Mee https://tinyurl.com/yxz3p53b). They are strong looks, it has to be said…
Have a fun weekend!