KARACHI: Bearish sentiment dominated the trading session at the cotton market with firm spot rate, traders at the Karachi Cotton Association (KCA) said on Monday.
In Punjab and Sindh stations mills purchased lint on competitive prices around Rs 6,025 per maund to Rs 6,250 per maund depending on grade while the KCA spot rate committee kept the spot rate at Rs 6,600 per maund in order to support baseline prices, floor brokers said.
During the trading session, spinners in Punjab and Sindh stations made deals for fine grades at around Rs 6,750 per maund to Rs 6,900 per maund in order to maintain the inventories firm on back of shrinking stocks, said traders.
General buyers bought all grades on competitive rates even at Rs 5,475 per maund while sellers withholding fine grades offered their produce at around Rs 6,950 per maund on growing demand, floor brokers said.
More than 3,000 bales changed hands with more than 80 percent of Punjab’s share in trading.
“Under non-aggressive buying spirit by the leading buyers some deals changed hands at Rs 5,000 per maund in Punjab stations while in Sindh stations second grade changed hands at Rs 4,950 per maund,” said an analyst. “International lint prices are under some pressure on lack of interest by major buyers though the New York Futures market sentiments regained some strength.”
Liquidity crunch is also one of the major reasons for dull buying by many of the secondary traders in the market.
Export orders for yarn and textile made-ups by European Union and US traders were still in the pipeline but grade issue of lint hampers the production outlook.
Buyers in Punjab and Sindh stations also made forward delivery deals on a month’s period for all grades at around Rs 5,125 per maund to Rs 5,325 per maund while buyers with average liquidity in Punjab and Sindh stations made forward deals on a month’s delivery period at Rs 5,025 per maund to Rs 5,125 per maund.
New York market July 2013 Futures stood at around 85 cents per pound and October 2013 Futures at around 84 cents per pound. Cotlook A index was hovering around 91 cents per pound.