Home / Knowledge / News / Textiles / Cotton markets touch new lows
Cotton markets touch new lows
08
Sep '08
Cotton struggled back and forth throughout the holiday-shortened week before finally collapsing on Friday. Fears of potential losses on the supply side of the equation from the series of tropical events were greatly overshadowed this past week by widespread fears of even greater losses in demand.

Weakness in the global economy and realization that the general public is now being clobbered by widespread liquidation of hedge funds dwarfed fears spawned by potential weather losses.

In economic news Friday, Traders “expected bad and got worse” from the job report when that indicator went to a 5 year high. Hopefully, this weekends news will help begin to alter those attitudes.

With prices already weakened by closing at their lowest levels in two weeks on Thursday, cotton prices tumbled through previous lows and almost reached limit down before trying once again to dig in. The CRB index ended at its lowest level since early February with Fridays close the sixth straight losing session. It was obvioius that markets fed on one another's weakness.

The September Crop Production Report and WASDE is due this coming Friday. In August, USDA estimated yields at 842 lbs. per acre and production of 13.767 million bales. It is my understanding that Informa is now pegging the crop at 14.020 bales from 857 lbs yield.

Friday's reversal in the Dow Industrials was hailed as signaling an impending bounce by many analysts. However, initial reaction to Saturday's decision to bailout Fannie Mae and Freddie Mac was wildly enthusiastic. As of this writing Sunday evening stock futures were trading a whopping two percent higher.

The move is looked at as a positive for banks around the world. Hopes are, of course, that the move will aid in recovery of the housing and credit markets. However, this week investors will also be watching retail sales, pending home sales, trade deficit and wholesale inflation. Despite an impressive reversal off the lows Friday, the Dow still lost 2.79 percent and the Nasdaq 4.72 percent for the week.

Initial reaction to the Fannie/Freddie news also put pressure on the dollar and strength into gold, silver and grains and I would expect the same reaction in cotton. Ike's proximity to the Gulf put strength into crude oil futures.

Often times moves become overextended on Friday as one side or the other throws in the towel for the weekend. If that was indeed the case, prices should demonstrate early buoyancy and resilience from support that should build support well above Friday's closing levels.

Fridays technical collapse was accelerated when sell stops were triggered below 6810, 6762 and 6679. Friday's lows basically reached the trend line off the July/August lows which in itself, should satisfy downside targets and help provide a bounce.

Swiss Financial Services

Must ReadView All

Textiles | On 21st Feb 2017

Net profit at Indorama Ventures zooms 145% in 2016

Net profit at Thailand headquartered and Aloke Lohia led Indorama...

Information Technology | On 21st Feb 2017

ThreadSol launches IntelloBuy & IntelloCut in Vietnam

ThreadSol, the pioneer of enterprise material management for sewn...

Textiles | On 21st Feb 2017

GST to reduce documentation for logistics firms: CBRE

The Goods and Services Tax (GST) is likely to result in a reduction...

Interviews View All

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

C Kamatchisundaram
Voltas

ITME is an occasion not only to receive new leads but also to work on...

Md Hanifur Rahman
Aman Group

The level of understanding the job role and organisational requirements...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer Prathyusha Garimella is known for blending...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
February 2017

February 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search