Christmas present

The watch is by the same designer but is it the same design. There are times when I wish I had two of a watch that I particularly liked.

Well Kaylam did only buy it for her husband two years ago so it is a bit disappointing for her I suppose it depends whether the daughter knew you had bought it two years previous or does she live away and not see so much of her Dad wearing it if that’s the case it maybe proves you both know him and his tastes well
A shame she didn’t ask you what he needed or wanted but not much you can do now and no point in spoiling relationships or Christmas. It might be a bit embarrassing for him when he gets it though

Yes you are overreacting. Why does it matter?

It doesn't matter

Many people like to have more than one watch and like a particular designer.

Maybe he has said to his daughter how much he likes the watch you bought him so has bought a different design from the same designer.

Unless, sorry

I less there is further background, sounds like an overreaction

It looks to me like an over reaction. None of our AC would have a clue what I got DH for Christmas any year.
Unless there is more of a back story that would cause the OP to feel aggrieved..

I would normally agree that it's difficult to remember past presents, but in the case of a watch he presumably wears it daily and she sees it every day and therefore is constantly reminded of it.

His daughter presumably has noticed it too, so it is rather an odd choice of gift. Are there any other similar incidents that have made you feel this way? Is this the last straw or a one-off event?

I could not tell you what I gave DH for Christmas last year and certainly would not expect either of our children to remember, still less for them to remember what I gave him may be 5 years ago.

As far as I am concerned any reaction to this event other than a shrug is an over reaction.

She probably thought he needed a new watch. How many years ago did you buy him the watch? Perhaps she thought he needed an upgrade, or another model. Perhaps he likes watches. Just this morning my friend was complaining about her son who has bought himself another watch.
If you have a fairly good relationship with your step-daughter, keep it that way. Yes, you are overreacting .....

Why has he got it already ? Surely she should have kept it for Christmas ?

I'm sure it was an accident. Maybe he can exchange it or enjoy having a back up?

You need to ask?