After five straight days of losses, the European carbon market rebounded on Wednesday, driven by news late Tuesday of a trade agreement between the US and Japan, followed by reports suggesting a similar deal with the EU is in progress.

Just before markets closed, the Financial Times, citing EU diplomats familiar with the matter, reported that the European Union is nearing a trade agreement that would impose a broad 15% tariff on EU goods, avoiding a steeper 30% levy set to take effect on August 1.

In this context, EUAs ended the session at €69.36, rising €0.25 on the day, continuing their recent trend of tracking stock market movements while moving further away from falling gas prices. The TTF front month dropped to its lowest in over two weeks before closing the day with a 1,27% decline amid strong supply and more flexible storage targets imposed by the EU.

The upward trend in the European carbon market continued on Thursday morning, with EUAs briefly reaching €70.49 before easing later in the session, reflecting a similar pattern seen in the stock markets.