Commodities Daily - June 3, 2019

> Oil continues to slide as investors run to safety amid US-Mexico and US-China trade wars, which propel recession fears. This morning, with risk sentiment likely to continue deteriorating, global equities and oil prices continue to tumble while safe-haven sovereign bonds and gold are trading higher. A preliminary assessment by Reuters and Bloomberg of OPEC's production in May is due today and could be slightly price supportive. The US will see a heavy week for data that may affect global sentiment, including the ADP employment report and Fed Beige Book on Wednesday and nonfarm payrolls on Friday. Today, we expect Brent to slide toward the $60/bbl mark with the next technical support at $58.62/bbl (23.6% Fibonacci retracement from Brent's October correction).> Gold shines as Washington's spreading trade wars boost safe-haven assets. Today, the US ISM manufacturing PMI index and final manufacturing PMI indexes for European economies are due, while the US labor report will be released on Friday. We think gold is likely to extend earlier gains today and break above $1,320/oz later amid further strong risk-off.