Mumbai - Stretching sharp losses of the last weekend, cotton went down further into the red territory amid continued profit-booking by traders and speculators during early hours of the session on both the domestic exchanges Monday. While NCDEX April cotton dropped Rs 5.50/20kg, MCX April cotton lost Rs 2.90/20kg.

At the spot markets Saturday, cotton lint traded almost steady as deals are not taking place at current higher rates despite demand from millers at the spot markets across northern India. Around 8,000 bales of kapas arrived in the entire northern region today.

Across western India, cotton lint traded weaker amid slight rise in arrivals and negligible demand at current higher prices at the spot markets Saturday. The sharp decline in US cotton futures also had adverse effect on the domestic spot market.

ICE Futures US cotton dropped sharply Friday as panic profit taking hit many markets amid perceptions of economic instability, analysts said. May cotton ended 151 points lower at 79.30 cents a pound and the July contract settled down 149 points at 81.90 cents. For the week, the May contract lost 185 points.

At 11.04 am IST, NCDEX benchmark April cotton surrendered Rs 5.50 to trade at Rs 518.50/20kg, after witnessing movement between Rs 516.00 and 521.00/20kg. Open interest in April cotton was 3,801 lots. NCDEX March cotton dipped Rs 7.00 to trade at Rs 496.00/20kg. Open interest in March cotton was 59 lots.

MCX April-08 contract was trading down Rs 2.90 at Rs 487.80/20kg.