Mumbai, 9 Sep (Commoditiescontrol): Cotton prices tumbled to their lowest levels in over two weeks as weak economic data and bearish market sentiment led to a sharp decline across commodities. Cotton futures saw back-to-back weekly losses, reflecting the broader negative trends in equities, oil, and grain markets. With traders focusing on this week’s crucial data releases and the upcoming Federal Reserve meeting, the market is bracing for heightened volatility.
On Friday, ICE cotton futures fell, driven by concerns over weaker demand and a bearish outlook ahead of upcoming harvests. The December cotton contract dropped by 1.56 cents, settling at 67.88 cents per pound. March and May contracts also declined to 69.69 cents and 71.02 cents per pound, respectively. The December contract ended the week with a 3% loss, marking its second consecutive weekly decline.
Investor sentiment remained fragile as Wall Street’s main indexes slid, following a jobs report that left uncertainty over the Federal Reserve’s interest rate strategy. Additionally, a stronger U.S. dollar and falling crude oil prices added to the pressure on cotton. The dollar index rose by 71 points, and crude oil futures fell by $1.04 per barrel.
Cotton prices have dipped below the $0.70 mark as the market awaits further macroeconomic data, with demand concerns, particularly from China, weighing heavily on the market. Despite reduced production estimates, traders remain cautious, closely watching support and resistance levels for December contracts between 67.26/66.65 cents and 69.03/70.19 cents per pound, respectively.
In August, the December contract managed a 1.5% gain, breaking a four-month losing streak, partly due to weather-related concerns. Emerging tropical systems in the Atlantic, including one nearing the Caribbean, raised fears of potential supply disruptions.
The U.S. Department of Agriculture (USDA) reported strong export sales, with Pakistan and India as major buyers. However, U.S. cotton exports have reached only 38% of the USDA's annual forecast, lagging behind the usual pace. The USDA’s latest crop progress report showed that 44% of the U.S. cotton crop was rated good-to-excellent, up from 40% the previous week.As traders navigate a complex landscape of market uncertainties, including demand concerns, weather disruptions, and geopolitical factors, cotton prices remain vulnerable to further volatility in the coming weeks.
(By Commoditiescontrol Bureau: 09820130172)
0 Comments 
Post Comment 
