NATGAS: Natural Gas End of Day Summary: Henry Hub Loses Ground
Jun-09 18:12
Henry Hub is extending losses again today, although remains above its intraday low of $3.581/MMBtu. Pressure remains amid global demand concerns, while curtailed LNG exports set against a warm weather forecast.
- US Natgas JUL 25 down 4.6% at 3.61$/mmbtu
- US Natgas AUG 25 down 4.3% at 3.7$/mmbtu
- Lower 48 natural gas demand is estimated up 1.48 bcf/d today after a slight dip over the weekend, BNEF shows. Demand remains above the previous five-year average around 68 bcf/d for the time of year.
- US cooling demand for the week ending June 14 is forecast to be 14 CDDs above the long-term normal, according to Bloomberg, citing the NOAA.
- US domestic natural gas production is estimated down 333 mmcf/d on the day at 105.62 bcf/d today: BNEF.
- Total feedgas flows to US LNG export terminals are estimated up 288 mmcf/d today to 13.59bcf/d: BNEF
- US and China trade officials are meeting in London today to try and progress trade talks.
- China gas imports were up on the month to 10.106m mt in May although year to date imports fell 9.5% with May down 11% year on year.
- India’s 10-day moving average LNG imports fell to the lowest since January at about 36k mt/d June 5, according to Bloomberg.
- Slovakia will block any EU sanctions measures against Russia that would hurt its national interests: PM Robert Fico.
- A new LNG cargo will arrive on June 13 at its second FSRU in Wilhelmshaven: DET.
- In May, US LNG exports to Latin America and the Caribbean dropped over 22% from April, totalling 27.39 Bcf, Platts said. This is compared to 35.18 Bcf the previous month
- MNI Commodity Research: Political Drivers for Energy June 9-15: Download Full Report Here
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MACRO OUTLOOK: US PPI/Retail Sales And Powell Follow On Thursday [2/2]
May-09 20:17
- Core PCE implications will then be watched closely in Thursday’s PPI report, and we expect with additional focus on portfolio management after last month’s huge upward revision to February.
- Retail sales, whilst only reported in nominal terms, will offer a keenly awaited look at consumer behavior.
- Real spending moderated to 1.8% annualized in Q1 after 4.0% in Q4 despite likely tariff front-running, with April a good test of how much discretionary spending was pulled forward.
- Finally, Powell provides “Opening Remarks” at the Second Thomas Laubach Research Conference, although he’s allotted twenty minutes so there is scope for more substantive remarks than you’d usually expect. His message at Wednesday’s FOMC press conference was one firmly of being in no hurry to cut rates amidst huge uncertainty. He also appeared to put more weight on hard data over soft indicators that appear more stagflationary in nature.
MACRO OUTLOOK: US CPI Offers Look At April Tariff Distortions on Tuesday [1/2]
May-09 20:15
- The week’s US data calendar is highlighted by CPI inflation on Tuesday although PPI inflation and retail sales reports on Thursday are in close second. All three releases are going to be important, offering further hard data for April in the first month under reciprocal tariffs. What’s more, PPI and retail sales are followed by Fed Chair Powell just ten minutes after their release (more on that below).
- Core CPI inflation is seen accelerating to 0.3% M/M in April, with six unrounded estimates we’ve seen to date averaging 0.27% M/M.
- A potential for a ‘low’ 0.3% aside, it’s still likely a swift acceleration from a particularly soft 0.06% M/M in March which was in large part down to surprisingly abrupt declines in lodging away from home (-3.5%) and airfare (-5.3%) prices.
- This lodging weakness carried over to core PCE inflation back in March, at just 0.03% M/M after a particularly strong 0.50% M/M in February in a large wedge with core CPI at 0.23% M/M.
- Markets currently price a next Fed cut with the September FOMC meeting.
USDCAD TECHS: Pressuring Resistance
May-09 20:00
- RES 4: 1.4296 High Apr 7
- RES 3: 1.4111 High Apr 4
- RES 2: 1.4041 50-day EMA
- RES 1: 1.3943 High May 9
- PRICE: 1.3930 @ 16:06 BST May 9
- SUP 1: 1.3751 Low May 6
- SUP 2: 1.3744 76.4% retracement of Sep 25 ‘24 - Feb 3 bull run
- SUP 3: 1.3696 Low Oct 10 2024
- SUP 4: 1.3643 Low Oct 9 ‘24
USDCAD has recovered from its recent lows. Despite the recovery, the trend condition remains bearish and short-term gains are considered corrective. A fresh cycle low on Tuesday reinforces the bearish theme. Potential is seen for a move towards 1.3744, a Fibonacci retracement. Note that moving average studies are in a bear mode position, highlighting a dominant downtrend. Key resistance is seen at 1.4041, the 50-day EMA.
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