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Cocoa ends

sharply lower

NEW YORK: CSCE cocoa futures fell sharply Tuesday but managed to hold near chart support as a week-long rally appeared to come to an end, dealers said.

Traders cited steady profit taking from the industry and speculators along with renewed selling interest from producers.

But light buying by manufacturers held the market above technical support, seen at $1,296-$1,298 for September.

Cocoa prices had surged $82 a tonne since the beginning of August, to a high on Monday of $1,318. But traders said the market's weak fundamental backdrop put an end to the run-up once the funds had covered short positions.

"The market basically had a short covering rally. I don't think it was anything more than that," said Steve Platt, softs analyst for Dean Witter.

Further losses ahead of September's first notice day on August 18 were likely, he added.

September cocoa fell $20 a tonne, to $1,298, after ranging from $1,296 to $1,312. December yielded $25, to $1,327, while the remaining months were down $27.

An estimated 11,852 lots changed hands on the day.-Reuter