Cotton futures snapped a six-day streak of declines on Friday to post their largest single-session gains in two weeks and finish the week little-changed, with the day's gains attributed to a quick flurry of buying amid options expiry. Prices spiked at 1:30 pm EDT (1830 GMT) after holding near unchanged for most of the session, which traders said was likely due to market participants squaring positions by buying futures as cotton options expired Friday.
"It was a flash in the pan connected to the options expiration," said Peter Egli, director of risk management for British merchant Plexus Cotton. US cotton research firm Cotton Outlook slashed its estimates for world production and ending stocks on Friday morning. March cotton on ICE Futures US settled up 0.70 cent, or 1.11 percent, at 63.69 cents per lb. It traded within a range of 62.95 and 63.93 cents a lb.
Prices closed the week down 0.02 cent, or less than 0.1 percent. Total futures market volume rose by 456 to 16,257 lots. Data showed total open interest fell 1,636 to 189,439 contracts in the previous session. Certificated cotton stocks deliverable as of December 17 totalled 65,238 480-lb bales, down from 65,240 in the previous session. The dollar index was down 0.55 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was up 0.85 percent.