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  • PES Weekly

Weekly report week 43

Whats going on in the energy market today.



OVERVIEW


Since the last report (2 weeks ago) front season power has risen 7.13 per cent but was down marginally last

week.

Front season gas has dropped 4.81 per cent in the same time period.

Equities are largely up from 2 weeks ago with the biggest mover being the German DAX.

Coal continues to remain bearish, whilst carbon has been bullish – rising 8.85 per cent in the last two weeks.

Although there was some reprieve last week.

The pound has strengthened against both the dollar and the euro, as a potential path out of deadlock has been

realised. The pound was up 3.08 per cent over the euro for the last two weeks, whilst the pound was up 4 per

cent against the dollar over the same period.


UK Currency

As the pound is still intrinsically linked to the ongoing Brexit developments, we have recently seen a bounce against the euro and dollar. The acceptance of the EU to offer an extension to the current deadline of October 31st gave markets enough security for the pound to rally. Whilst Boris Johnson managed to get overall approval in the House of Commons for his withdrawal agreement, the super-charged three-day programme motion to debate and approve the agreement was rejected. Johnson decided to the bill in favour of a general election. Whilst there is certainty for the next three months, the prospect of a general election will continue to weigh on the ambitions of the pound and currency will likely follow the numerous polls available to us over the next 6 weeks. Expect more volatility.



UK Equities

Since the last report, the FTSE 100 has climbed 2.36 per cent, the DAX climbed 7.34 per cent, the S&P 500 climbed 2.39 per cent, and the Hang Seng climbed 3.28 per cent. There are real hopes that China and the US are moving towards a trade pact, which have boosted US stocks over the last few weeks. There is “little in the pipeline to alter risk sentiment from last week”, said Jingyi Pan, markets strategist at IG Group, with traders focused on any new potential developments on the US-China trade front. “Investors remain in anticipation of the US-China phase one deal signing in November,” Ms Pan added. All eyes are on a potential trade deal that could be signed off mid-November. Europe’s markets largely reacted to this news, as well as the ongoing Brexit deliberations.




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