ICE cotton futures were mostly unchanged on Friday, buoyed by optimism around a US-Sino trade deal and a weaker dollar that overshadowed a dismal export sales report from the US Department of Agriculture (USDA). Cotton contracts for March rose 0.02 cent, or 0.03 percent, to 68.72 cents per lb by 12:50 p.m. EST (1750 GMT). It traded within a range of 68.5 and 69.33 cents a lb.
The natural fiber has risen more than 1 percent so far this week, set for its fifth consecutive week of gains. "The market is still rallying on hopes of a China deal and the world economy looks a lot better," said John Bondurant, a trader in Memphis, Tennessee.
The world's top two economies announced their Phase 1 deal earlier this month, but have since disclosed few concrete details. Beijing said this week it was in close contact with Washington on the pact. Trade optimism and better economic report out of China lifted global equity markets to fresh records in a year-end rally.
The dollar index was down 0.5 percent. A weaker greenback makes commodities priced in dollars, such as cotton, less expensive for holders of other currencies. "The spec sector now holds a small net long position in cotton futures, with plenty of room to add length in sponsoring a rally," said Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group in a note.
Total futures market volume fell by 4,317 to 16,417 lots. Data showed total open interest gained 1,038 to 215,079 contracts in the previous session. Certificated cotton stocks deliverable as of Dec. 26 totaled 11,699 480-lb bales, unchanged from 11,699 in the previous session.
Comments
Comments are closed.