POWER: CWE Power Week Ahead Fundamentals
Oct-24 11:12
CWE power markets are set to see mixed fundamentals next week, with strong wind generation and cooler weather at the start of the week, while temperatures are turning milder in the second half of the week, paired with easing wind generation. Precipitation in the hydro-intensive regions is expected to remain above normal.
- The latest ECMWF weather forecast for NW Europe suggests that the region is set to see a cooler start to the week next week with mean temperatures as low as 9.4C – less than 1C below the seasonal normal – before rising to 14.2C later in the week – compared with the seasonal average around 9.4C.
- Precipitation in NW Europe is forecast to total 23.1mm next week, slightly above the seasonal average of 20.1mm. However, precipitation in the hydro-intensive regions Sion, Switzerland, and Grenoble, France, is expected to rise well above the seasonal normal.
- Wind generation in CWE is forecast to ease back mid next week with output between 24.18GW, or a 22% load factor, and 59.52GW, equivalent to a 58% load factor, according to SpotRenewables. This comes after strong wind generation this week amid Storm Benjamin.
- Solar generation in CWE is expected to be seasonally low next week between 13.7GW and 20.91GW during peak-load hours, according to SpotRenewables.
- In France, nuclear availability is forecast to average 48.65GWh/h next week, up from 45.92GWh/h expected this week, Reuters data showed.
- Residual load in CWE is forecast at 78.78GWh/h next week. Residual load was forecasted to average 61.18GWh/h this week on 17 October, Reuters data showed.
- The German week-ahead base-load power contract is holding a strong premium over the French market at €39.41/MWh at the time of writing.
- Germany Base Power Week 2 up 5% at 81.16 EUR/MWh
- France Base Power Week 2 down 7.6% at 41.75 EUR/MWh
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JAPAN: Koizumi & Takaichi Play It Safe On Foreign Policy In LDP Debate
Sep-24 11:10
Earlier, the five contenders for the presidency of the governing Liberal Democratic Party (LDP) participated in a debate hosted by the Japan National Press Club. Asahi Shimbun detailed the main points of the debate, with key foreign policy comments from the main contenders, Agriculture, Forestry and Fisheries Minister Shinjiro Koizumi and former Minister of State for Economic Security Sanae Takaichi, below.
- Koizumi:
- On US-Japan relations: "Building trust between leaders is extremely important." He indicated a desire to meet Trump at the earliest possible time if elected PM. He said that "Japan-US relations remain the cornerstone of Japan's diplomacy."
- To former Minister of State for Economic Security Takayuki Kobayashi, Koizumi says that 2% of GDP on defence is "not nearly enough."
- Takaichi:
- On foreign relations: "I believe it is extremely important to cooperate and respond [with South Korea] amid the growing closeness between China, Russia, and North Korea. While there is economic competition to some degree, there is significant cultural exchange." Calls for deeper Japan-US-RoK links, as well as Japan-US-Philippines.
- On relations with China: "While there are concerns regarding economic security and national defence, diplomatic strength is crucial. We will approach this with a stance of engaging in candid and repeated dialogue."
- Takaichi demurred on the topic of visiting the controversial Yasukuni shrine. Advocating for the PM visiting during the 2024 LDP election, this time she said the issue should not be politicised in effort to maintain ties w/RoK if she becomes PM.
OUTLOOK: Price Signal Summary - Support In Bunds Remains Exposed
Sep-24 11:09
- In the FI space, Bund futures are unchanged and the contract is trading closer to its recent lows. Key support and the bear trigger lies at 127.61, the Sep 3 low. A break of this level would cancel a recent bullish theme and confirm a continuation of the medium-term bear cycle. For bulls, a reversal higher would refocus attention on key resistance at 129.44, the Sep 10 high. First resistance is at 128.60, the 20-day EMA.
- Despite the latest pullback from its recent highs, Gilt futures remain in a bull cycle and a recent rally highlights a stronger corrective phase. Note that the move higher has allowed an oversold trend condition to unwind. Price has breached initial firm resistance at 90.84, the Aug 28 and 29 high. A resumption of gains would open 92.06, the Aug 14 high. Initial support to monitor lies at 90.65 (pierced), the Sep 5 low.
MNI: US MBA: MARKET COMPOSITE +0.6% SA THRU SEP 19 WK
Sep-24 11:00
- MNI: US MBA: MARKET COMPOSITE +0.6% SA THRU SEP 19 WK
