Cotton fell for the seventh time in eight days as a report showing a drop in U.S. home sales added to concerns that weakening global economies will erode commodity demand.

Purchases of new houses in the U.S. declined in August to a six-month low, suggesting the industry that helped bring on the most recent recession will take more time to recover. Cotton prices tumbled 8.4 percent last week as EuropeΆs debt crisis escalated.

“People are running scared after whatΆs happened the past few days,” Sid Love, the president of Joe Kropf & Sid Love Consulting Services in Overland Park, Kansas, said in a telephone interview. “TheyΆre trying to reduce their risks, and at the first sign of trouble they say ΅here we go again,Ά and bail out.”

Cotton for December delivery fell 1.6 cents, or 1.6 percent, to settle at 99.64 cents a pound at 2:49 p.m. on ICE Futures U.S. in New York. The commodity has plunged 55 percent since reaching a record $2.197 on March 7.
The drop today was probably led by selling from funds, said Rogers Varner, the president of brokerage Varner Bros. in Cleveland, Mississippi.

Money managers cut their combined net-long position across 18 futures and options by 20 percent in the week ended Sept. 20, the most since February 2010, data from the Commodity Futures Trading Commission show. Bullish bets on cotton prices dropped 9.8 percent, the most since June.