* Market up 2nd day as stimulus support adds to export sales
* December cotton seen testing 77 cents and above next week

NEW YORK, Sept 14 (Reuters) - Cotton futures in New York
closed up for a second straight day on Friday, staging their
best rally in three weeks, as the Federal Reserve's third
stimulus action for the U.S. economy boosted it and a number of
other commodity markets.
Prices of crude oil and copper hit multi-month highs,
pulling along fellow industrial commodity cotton, a day after
Fed Chairman Ben Bernanke pledged to buy $40 billion worth of
mortgage debt every month until the U.S. jobs situation
improves.
"This is a Bernanke rally. With a QE3 announced, there's a
scramble to buy everything and those short on cotton had to rush
to cover," said Mike Stevens, an independent cotton analyst in
Mandeville, Louisiana.
Cotton's benchmark December contract in New York
settled up 2.37 cents, or 3.2 percent, at 75.90 cents per lb,
moving between 73.53 and 75.95.
Stevens said the market could test 77 cents and above next
week if it held to the current momentum. "As long as we don't go
below 74 cents, the high is open."
December cotton was down in the first three sessions of the
week, hitting a one-month low by Wednesday, after the U.S.
government raised its estimate for global cotton stockpiles in
2012/13 to a new record.
It rebounded slightly on Thursday, rising 0.3 percent, after
U.S. data revealed the country's biggest weekly export sales for
cotton since June.
The vast majority of those exports were headed for China,
the first concrete sign since June that the world's largest
consumer of cotton may have resumed buying.
Beijing has been preparing to kick-start its second year of
buying, although it is also due to auction off some of its
existing reserve to make room for new purchases.

It was not clear if the sales data released on Thursday were
a result of Beijing's efforts to replenish its strategic cotton
reserve, or if mills have restarted importing after fresh
licenses were distributed last month.
Fundamentally, the outlook for cotton remains somewhat weak,
despite the bullish mood for most commodities with the advent of
the Fed's third round of quantitative easing, or QE3.
The market has been bogged down by long-term concerns though
about waning demand and a record surplus that have kept prices
under 80 cents per lb since May.
In its Wednesday report, the U.S. Department of Agriculture
increased its estimate for the global cotton surplus to a record
of 76.5 million 480-pound bales due in part to a drop in
consumption and imports by China.
The new forecast boosted by nearly 2 million bales last
month's estimate -- already the highest since USDA records began
in 1960. A large carryover from last season was also a factor.