Market Information Tuesday 9 July 2024

Good morning,

Markets respond moderately positive to the French election results. After initial selling, investors reconsidered their actions. The spread between French and German ten-year bonds initially grew to 71 basis points. The CAC 40 is nearly back to its June 10 level, the day after Macron announced elections.

Record heat and hurricanes threaten U.S. refiners, potentially causing volatile fuel prices during peak travel season, analysts said. Half of the refining capacity of the U.S. is located along the Gulf Coast and vulnerable to storms. The US government expects up to seven major hurricanes this year, double the normal amount. A major storm could cut fuel supply by a million barrels per day, according to the U.S. Energy Information Administration (EIA). Furthermore, they state that outages of around 1.5 million bpd of crude production and refining capacity can cause gasoline prices to jump by 25 cents to 30 cents.

Prices for biofuels have dropped significantly in recent months. Between April 2023 and April 2024, the price for a thousand kilos of bio-kerosene, or sustainable aviation fuel (SAF), fluctuated between $1800 and $2200. However, at the end of spring, the price fell to just over $800 per ton. The market is fragmented. As a result, the price, quality, and quantity of the so-called feedstock – the material from which the fuel is made – are significantly less predictable than those of coal or natural gas. “Natural gas can now be purchased for delivery five or ten years from now,” says Van Eijck. “That’s not possible with waste oils like used cooking oil.”

The 6M Euribor is unchanged at 3.68% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.79% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.