ICE arabica coffee futures rallied on chart-based buying on Wednesday, reversing losses from Tuesday when the market saw its worst daily percentage loss in eight months. Sugar futures also advanced, boosted by strong nearby demand and a weaker dollar.
Positive economic sentiment also helped lift soft commodities higher, as global stocks rallied amid a brighter outlook for banks in Europe and the US. "It's a generally positive day for most commodities. There's a general warm fuzzy feeling that the sky's not falling," said Shawn Hackett, president of Hackett Financial Advisors, Inc in Florida.
Arabica coffee futures for September surged 5.40 cents or 3.4 percent to close at $1.6305 a lb, the biggest single day percentage gain in two weeks. The contract soared to a 12-year top at $1.7650 per lb on June 24 after a two-week rally that followed a prolonged spell just above $1.30.
September cocoa on ICE rose $14 to close at $2,981 a tonne. Sugar futures turned higher after early weakness as physical demand remained strong, with the raws moving up in modest volume on technical and suspected consumer buying, traders said. October raws on ICE gained 0.37 cent or 2.2 percent to finish at 17.06 cents per lb.
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