* Thomson Reuters-Jefferies CRB settles down 1.7 pct
* Weaker-than-expect China data spark concern over commoditiesdemand
* Cotton futures correct after 4-session rebound – dealers
NEW YORK, May 1 (Reuters) – Cotton futures sank on Wednesday, posting their largest one-day loss since June during an investor selloff prompted by technical weakness and worries over the health of the globaleconomy, dealers said.
The most-active July cotton contract on ICE Futures U.S. dropped 3.6 cents, or 4.1 percent, to settle at 83.87 cents per pound.
The tumble ended cotton’s longest string of daily gains since mid-March.
The Thomson Reuters-Jefferies CRB, a benchmark for globalcommodities, fell as weaker-than-expected Chinese manufacturing orders prompted worry over economic growth in the world’s largest consumer of many commodities and the largest textile market. U.S. manufacturing data also showed a slowdown in growth.
“Cotton performed admirably during the day (despite outside pressure), but eventually gave way to the broader selloff,” said Chris Kramedjian, a risk management consultant for INTL FCStone, pointing to investors behind the selling.
Dealers said prices were ripe for a technical correction after closing higher over the past four sessions and recovering much of the ground lost last week on dips to two-month lows.
During April, spot prices posted a monthly loss of 4 percent.
Investment from speculators drove prices to a first-quarter rally of 18 percent, as the noncommercial dealers boosted their net long position in cotton futures to a five-year high during the month of March, according to data from the Commodities Futures Trading Commission.
As the speculators cut their position, cotton’s upswing began to lose momentum.
Prior to the first quarter gains, fiber posted two years of declines, as lower-priced, synthetic alternatives eroded demand for cotton, and global inventories grew. (Reporting by Chris Prentice; Editing by David Gregorio)