Watson, who was wearing strapping all the way down her right arm, lost out 6-2??6-4 to the American.
The match got off to the worst possible start for Watson as Stephens broke her??first two service games and held her own to take a 3-0 lead.
However, Watson had three game points in the next on Stephens’ serve and, despite squandering one of them when she found the net, held on to make her??first mark on the scoreboard.
Stephens hit back in the fifth game, again breaking Watson to take a 4-1??lead before closing out the next to stand one game away from winning the first??set.
Watson made a better fist of her fourth service game and pulled it back to 5-2,??before taking Stephens to deuce as she tried to serve out the set, but it was??not enough as the world No 40 took it 6-2.
Watson again dropped her first service game in the second set to give the upper??hand to her opponent, who raced 3-1 clear before the Brit pulled one back.
Stephens held serve again and pushed Watson all the way on her next service??game, with the world No 45 eventually pulling back to 4-3 down on advantage??before breaking the American to level the second set at 4-4.
However, Stephens replied in kind, breaking Watson for the fifth time to put??herself on the brink of victory and to serve out for the match, which she did as??the Brit sent a return long.