European carbon rises on firmer equities, oil

LONDON Thu Jun 3, 2010 8:10am EDT

LONDON (Reuters) - European carbon emissions futures rose on Thursday, boosted by improved financial markets and a firmer oil price, traders said.

EU Allowances for December delivery were up 16 cents or 1.05 percent at 15.43 euros ($18.98) a tonne at 0657 GMT, with light volume at 1,507 lots traded.

"There is some stop-lossing at 15.40. The Nikkei is up 3 percent, oil is looking firmer and carbon is following that sentiment," an emissions trader said.

Utilities are largely absent from the market and there is a reluctance to open new large positions, giving financial institutions the opportunity to lift prices, other traders said.

There is a religious holiday in some German states on Thursday.

Certified emissions reductions were up 9 cents or 0.72 percent at 12.63 euros a tonne, setting the EUA-CER spread at 2.80 euros.

Asian stocks rallied for the first time in three days on Thursday as U.S. housing data fueled by optimism about the world's largest economy, while the yen was pressured by expectations that Japan's new political leaders will favor a weaker currency.

U.S. oil rose for a second day on Thursday to near $74 as robust U.S. economic indicators re-injected some confidence into financial markets and signaled oil inventories in the world's top consumer may shrink.