Raw sugar futures rocketed to close up more than 4 percent at a one-month high on Tuesday, catching a ride higher with crude oil's rally and the weak US dollar on Election Day, brokers said. The key March raw sugar contract finished up 0.53 cent, or 4.4 percent, at 12.71 cents per lb, the highest settlement since October 2.
The contract traded in a wide range from 12.09 to 13 cents. May sugar rose 0.50 cent to close at 12.96 cents. Volume traded in the March contract hit 51,113 lots at 2:01 pm EST (1901 GMT). Market reversed up from earlier losses on the weak US dollar and as US crude oil also clawed higher.
Raws joined the broad-based commodity rally lead by crude oil that surged more than 11 percent as signals that Opec members were cutting production in line with the group's recent decision. Dollar-traded markets, such as raw sugar, rallied while the greenback extended losses, marking its biggest one-day drop against a basket of currencies in 13 years.
The dollar weakened as investors bet global interest rate cuts will alleviate the financial crisis. Americans voted in the US presidential election. The sugar market has undergone a trend reversal following the past eight presidential elections - Markets and Elections 2008 report by Sterling Smith, vice-president with FuturesOne in Chicago.
Report best used as a seasonal guide, looking for larger moves - Smith. Volume Monday in the No 11 sugar market at 66,706 lots - exchange data. The domestic No 14 sugar market showed the January contract down 0.20 cent at 20.30 cents at 2:01 pm volume traded Monday in the No 14 market was at 619 lots, the exchange said.
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