NEW YORK, Nov 1: NY cotton futures ended limit down on Friday for the second straight session on fund and speculative liquidation in the first big drop the market has seen since rallying to a 5-year high last week, analysts said.

December cotton again slid the 3.00 cents limit to end at 76.73 cents a lb, with the day’s high at 78 cents. March was also limit down at 78.92 cents. The rest were 0.50 cent to 3.00-cent limit lower.

The market had embarked on a furious rally after news emerged a few weeks ago of a disastrous crop in China and heavy buying of US upland cotton by Chinese mills scrambling to fill the needs of their booming apparel and textile industry.

In the last USDA weekly export sales report, US net upland cotton sales hit a marketing year high for the second straight week at a record 1,428,400 running bales (RBs, 500 lbs each), with top buyer China picking up 1,238,600 RBs.

Right off the bat, cotton futures tumbled on follow-through speculative and fund selling as key months slid 3.00 cents. Near the lows, solid trade buying stabilized the market somewhat, analysts said.

Stevens said that since December futures had fallen sharply since hitting a contract high of 84.80 cents on Thursday, other textile buyers who have shied away from the market due to its searing rally would now see an opportunity to step in.

Floor dealers said estimated final volume reached 26,000 lots, from the previous count of 27,711 lots. Open interest in cotton fell 2,081 lots to 115,336 lots as of Oct. 30, an indication of the heavy speculative net long stance in cotton. —Reuters