New York cotton hits six-week high
December 05, 2012
US cotton futures hit their highest levels in almost six weeks on Monday on speculative buying and a weaker dollar but pared gains late in the day on technical selling. Prices rose almost 1 percent and pierced 74 cents per lb in early trading for the first time since October 23 as fresh speculative money piled into fibres on the first day of the month.
“This is thought to be speculative buying driven by the Chinese (manufacturing data) and the dollar,” said Andy Ryan, trader at INTL FCStone. Later on, tentative producer and technical selling pushed prices off their highs, with the most-active March contract on ICE Futures US settling up 0.07 cent, or 0.09 percent, at 73.98 cents per lb. The gains were in line with the broader commodities market as stronger growth in China, the world’s biggest cotton consumer and producer, and positive US factory data helped override concerns about the US “fiscal cliff” that has hurt sentiment for weeks.
The pace of activity in China’s manufacturing sector quickened for the first time in 13 months in November, a survey of private factory managers found, adding to evidence that the No 2 economy is reviving after seven quarters of slowing growth. Adding further momentum, the euro hit a six-week high after German Chancellor Angela Merkel said on Sunday Greece’s creditors may look at writing down more of the country’s debt – a move that made Athens’ burden, and Europe’s debt as a whole, seem more manageable. Exchange stocks rose to above 61,000 bales from 58,692, with another 30,179 bales awaiting review.