Cotton hits more than four-month low on robust dollar
April 10 (Reuters) -ICE cotton futures fell to their lowest level in more than four months on Wednesday, pressured by a surge in the U.S. dollar and an overall downbeat sentiment in the financial market.
* Cotton contract for May CTc1 fell 0.5 cents, or 0.6%, to 85.55 cents per lb by 11:33 a.m. ET (1533 GMT), after dropping to its lowest level since early January earlier in the session.
* The dollar index .DXY jumped 1% to its highest since mid-November against its rivals, making the natural fibre more expensive for overseas buyers.
* "The dollar has broken out to the upside and that is a negative factor for cotton," said Rogers Varner, president of Varner Brokerage, in Cleveland.
* U.S. share futures tumbled after data showed U.S. consumer prices rose more than expected in March casting doubts on whether the Federal Reserve will start to cut interest rates in June. .N MKTS/GLOB
* "Six weeks ago there were only 1000 bales of cert stocks in warehouses and now there's 136,000, that has really grown and it has pushed prices down plus the specs are liquidating as option expiration approaches," Varner added.
* "Well, the cert stocks are a lot bigger, but the carry out is very small, so I think once this liquidation is over, the market will rebound."
* Certified cotton stocks, which can be delivered against the contract, were at 136,124 bales compared with 88,707 bales on April 3, according to ICE data.
* Investors are now awaiting the U.S. Department of Agriculture's (USDA) monthly World Agriculture Supply and Demand Estimates (WASDE) report due on Thursday
* Also on the radar, USDA's weekly export sales data is due on Thursday.
Reporting by Rahul Paswan in Bengaluru; Editing by Shailesh Kuber
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