EMISSIONS: EU End-Of-Day Carbon Summary: EUAs Rise on Record High Spot Price
Dec-11 16:20
EUAs Dec25 are rising to the highest level since late January and crossed above the upper Bollinger Band after the spot auction cleared at its strongest level since late September 2023. UKAs Dec25 are also rising on EUA strength, while the UKA 10-day average briefly crossing below the 50-day average for the third time in the past year.
- EUA DEC 25 up 1.77% at 83.88 EUR/t CO2e
- UKA DEC 25 up 0.57% at 55.98 GBP/t CO2e
- TTF Gas JAN 26 up 0.9% at 26.835 EUR/MWh
- NBP Gas JAN 26 up 1.1% at 70.49 GBp/therm
- Estoxx 50 up 1% at 5765.17
- The latest EU ETS CAP3 auction cleared at €83.77/ton CO2e, up 1.89% compared with the previous EU auction at €82.22/ton CO2e according to EEX.
- Over the past year, the strategy of entering a short position in EUAs front-December when the price cross above the upper Bollinger Band and exiting all when it crosses below the 10-day moving average would have yielded a 12.9% return, with seven out of eight trades finishing in positive returns and an average holding period of seven days.
- Over the past year, the strategy of entering a long position in UKAs front-December when the 10-day average cross below the 50-day average and exiting all when it rise back to above would have yielded a 18.5% return, with all two prior trades finishing in positive returns and an average holding period of 13 days.
- The medium-term trend condition in ICE EUA futures is unchanged, it remains bullish. Today’s fresh cycle high confirms a resumption of the medium-term uptrend and maintains the price sequence of higher highs and higher lows. Potential is seen for an extension towards €84.50, the Jan 30 high and a key resistance. Clearance of this hurdle would strengthen the bull theme. Support to watch lies at €80.09, the 50-day EMA.
- TTF front month has edged up from a fresh low of €26.535/MWh yesterday but still maintaining the bearish trend since Nov. 18 with mild weather set against slightly reduced LNG imports. A report that Zelenskiy may be willing to put territorial control over Ukraine’s Donbas to a referendum added some pressure, before prices retraced the losses.
- Analysts from Macquarie, Engie and Wind Energy expect further upside in EUAs amid decoupling from TTF and rising speculative bullish bets, Bloomberg reported.
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OPTIONS: Larger FX Option Pipeline
Nov-11 16:10
- EUR/USD: Nov13 $1.1575(E1.1bln), $1.1590(E1.5bln); Nov14 $1.1625(E1.4bln)
- USD/JPY: Nov13 Y147.00($1.6bln), Y152.96-00($1.1bln), Y155.00($1.1bln)
- AUD/USD: Nov14 $0.6750(A$2.2bln)
- USD/CAD: Nov14 C$1.4025-35($1.2bln)
OPTIONS: Expiries for Nov12 NY cut 1000ET (Source DTCC)
Nov-11 16:08
- EUR/USD: $1.1500-05(E1.1bln), $1.1550(E790mln), $1.1585-90(E565mln), $1.1645-50(E855mln), $1.1688-90(E1.3bln)
- USD/JPY: Y154.00($500mln)
- GBP/USD: $1.3100(Gbp1.9bln), $1.3150(Gbp674mln), $1.3225-30(Gbp1.3bln)
- AUD/USD: $0.6500(A$1.4bln), $0.6530-50(A$1.4bln)
- NZD/USD: $0.5600(N$538mln)
G7: Trade/Tariffs Provides Subtext For Two-Day G7 Foreign Ministerial In Canada
Nov-11 16:00
Trade and tariffs are likely to provide the subtext of a two-day G7 foreign ministerial meeting that gets underway in southern Ontario, Canada, today. Along with G7 regulars, the foreign ministers of Australia, Brazil, India, Saudi Arabia, Mexico, South Korea, South Africa, and Ukraine will be in attendance.
- US Secretary of State Marco Rubio’s attendance will be the most high-profile trip by a Trump administration official to Canada since Trump terminated trade talks with Ottawa last month, claiming an advert funded by the provincial government of Ontario was aimed at influencing the outcome of a US Supreme Court case on Trump’s tariffs.
- Canadian Foreign Minister Anand said this week, “The work that Canada is doing is continuing to lead multilaterally in an era of a greater movement to protectionism and unilateralism. And in an era of economic and geopolitical volatility.”
- Anand is likely to use the meeting to improve the working relationship with Rubio. One potential route to renewing trade negotiations could be providing Washington with greater access to Canadian minerals, including rare earths. Recently, US President Donald Trump struck mineral agreements with Australia, Malaysia, Kazakhstan, and Uzbekistan; and pledged to expand rare earth processing operations with Japan and South Korea – moves aimed at addressing China's dominance of the global rare earth supply chain.
- “The expectations are quite low, but avoiding drama and fostering basic common ground on issues like Ukraine and Russia would be helpful” for Canada, an expert told WaPo.
- Ottawa may be bolstered by bullish comments from Trump in the Oval Office yesterday, suggesting that trade deals with India and Switzerland are close, two countries among the hardest hit by Trump’s tariffs.
