POWER: EU End of Day Power Summary: Nordics Close Higher, CWE Erases Some Gains
Sep-17 15:08
Nordic front-month power futures have ended another session higher with forecasts pointing to dry weather. CWE front-month power futures have erased some gains with a pullback in EUAs and EU gas prices.
- Nordic Base Power OCT 25 up 3.3% at 42.75 EUR/MWh
- France Base Power OCT 25 up 0.7% at 57.34 EUR/MWh
- Germany Base Power OCT 25 up 0.1% at 90 EUR/MWh
- EUA DEC 25 down 0.7% at 76.96 EUR/MT
- TTF Gas OCT 25 up 0.2% at 32.395 EUR/MWh
- TTF front month is extending gains from yesterday amid concern for future Russian supplies, set against an expected ramp up in Norwegian supplies later this week. EC President von der Leyen said that the EU is looking into fast tracking the end of energy imports from Russia after the US said it needs to stop.
- EUAs/UKAs Dec25 are edging lower, reversing earlier gains, weighed by a pullback in EU equities as traders await the Fed decision at 19:00 BST. Meanwhile, intraday volatility in TTF also influenced carbon prices, with the EUA-TTF intraday correlation holding above 0.50 in the afternoon.
- Investment funds slightly reduced their net short positions in the ICE German power futures for the second consecutive week according to the latest CoT data as of 12 September.
- ResInvest Group said the firm is in talks with Uniper to purchase the 1.05GW Datteln 4 coal-fired power plant.
- EdF’s 1.3GW Cattenom1 nuclear plant has been the most modulated this summer across all French nuclear plants.
- The Dutch government said on Tuesday it plans to grand around €1bln in subsidies for new offshore wind farm with 2GW of capacity.
- Germany’s hep solar plans to develop a pipeline of 400-500MW of new solar PV and energy storage projects across Italy with the first sites already secured.
- Norway’s hydro reserves last week rose to 78.2% of capacity, up from 76.8% the week before.
- Swedish hydropower reserves last week edged up by 0.2 percentage points to 80.5% of capacity.
- Fortum’s 507MW Loviisa 2 nuclear plant is scheduled to return on Wednesday at 17:00 CET, from 13:00 CET previously scheduled.
- Vattenfall’s 1.13GW Ringhals Block 4 nuclear plant in Sweden has restarted on Wednesday at 10:37 CET with full power expected to be reached in around 50 hours.
- Tauron plans to develop 1.4GW of new gas-fired capacity at three different sites.
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US TSY OPTIONS: Large Sep'25 10Y Call Buy
Aug-18 15:05
- +40,000 TYU5 112.5 calls, 2, total volume over 52,700, open interest at 163,678 coming into the session.
- Sep'25 options expire Friday
FOREX: Greenback Pops Into WMR Fix on Volume Spike, Rising Curve
Aug-18 14:58
- Greenback picking up into the WMR fix, helping trigger fresh daily lows across EUR/USD, GBP/USD and new daily highs for USD/CAD and USD/JPY.
- USD strength being driven partly by the run higher in the US curve - but also a sizeable uptick in EUR futures at 1047ET/1547BST. ~1000 contracts traded inside two minutes for a cash equivalent of ~$150mln. While the last few minutes have seen activity pick up, overall volumes on the day are very low: EUR futures are close to 30% below average for this time of day.
- While the USD's benefiting from the higher US curve, it's the opposite for GBP. Which is slipping despite a further backtrack in BOE rate cut pricing for 2025 (year-end implied rates now ~3.85%, or pricing just 12bps of rate cuts over the next three meetings).
- No specific headlines or newsflow behind the USD rally in recent trade - with low volumes and light liquidity the suspected driver. We mentioned earlier today the preference for markets to adopt a more neutral setting into Jackson Hole on Friday - evident in last week's CFTC data showing the net short trimmed off multi-year lows.
UK DMO UPDATE: Consultation agenda
Aug-18 14:44
The DMO has released the agenda for the consultation to be held Tuesday next week ahead of the release of the Oct-Dec auction calendar (on Friday 29 August at 7:30BST).
- Syndications: A new conventional 15-year gilt in October and a linker (new or existing) in November.
- The DMO has also raised the possibility of dual-tranche syndications (which are not currently held). These are not planned for FQ3, but could be introduced in the future.
- Short auctions (6 auctions): Launch and reopen at least once both a new 3-year gilt and new 5-year gilt.
- Medium auctions (4 auctions): The new 10-year Oct-35 gilt (which will be launched via syndication in the W/C 1 September) to be reopened at least twice in the quarter. The DMO is also welcoming views on a new 7-year gilt.
- Long auctions (2 auctions): Including a reopening of the
- Linker auctions (4 auctions): All existing.
- PGTs (5): 1 short, 1 medium, 1 linker and 2 other conventional (without maturity guidance).
- The next consultation will be held on Monday 24 November, subject to the timing of the Budget.
