I. Precious Metals
Gold

Gold fell to a near six-month low on Wednesday as the U.S. dollar index touched its highest since July 2017 against a basket of currencies after U.S. President Donald Trump threatened to impose a 10 percent tariff on $200 billion of Chinese goods and Beijing said it would retaliate. The trade spat reinforced concerns about global growth and triggered a selloff in equities, while boosting safe-haven currencies such as the yen and the dollar.

Typically, gold is used by investors as a place to park assets during times of global uncertainty. But the dollar's inverse relationship with bullion - a stronger greenback makes dollar-denominated assets more expensive for holders of other currencies - can often override other factors. In these environments, the Treasuries and dollars would tend to be safe havens, pressuring gold. Gold were trading around $1,275 an ounce, having touched its lowest since Dec. 22 at $1,270.

On chart, gold is testing the strength of previous support. But the downward tendency seems to remain intact. The loss of the support could pull bullion to as low as $1,240. But a technical correction is still likely in the near term.

Silver

Silver slipped for the third consecutive week on Tuesday. It dropped 0.5 percent at $16.32 an ounce, after hitting its lowest since May 16 at $16.21, only inches away from $16.20, a key support that holds well since February. But if gold suffers no sharp losses, the white metal is likely to find strong support at that level.

II. Commodities
Crude Oil

Oil fell on Tuesday ahead of a possible increase in OPEC crude supply, and as an escalating trade dispute between the United States and China unleashed sharp selloffs in many global markets.

Brent crude futures slipped 26 cents to settle at $75.08 a barrel, while U.S. West Texas Intermediate crude futures fell 78 cents, or 1.2 percent, to settle at $65.07 a barrel.

Russia plans to propose increasing oil production by the OPEC+ deal members by 1.5 million barrels per day, Energy Minister Alexander Novak told reporters, days ahead his visit to Vienna for the related summit. This renewed commentary is putting downward pressure on prices in a significant manner.

The Organization of the Petroleum Exporting Countries and allies, which have curbed supplies since 2017, meet on Friday in Vienna, where they had been expected to come to a decision as to whether to increase global oil production, and by how much.

Iran, however, said OPEC was unlikely to reach a deal on oil output this week, setting the stage for a clash with Saudi Arabia and Russia, which are pushing to raise production steeply from July to meet growing global demand.

The U.S. and China are threatening punitive tariffs on each other's exports, which could include oil. China's imports of U.S. oil have surged since 2017 to a value of almost $1 billion per month.

Copper

Copper prices hit three-week lows on Tuesday as worries about a trade war were reinforced after U.S. President Donald Trump threatened to impose a 10 percent tariff on $200 billion of Chinese goods and Beijing warned it would retaliate.

Benchmark copper on the London Metal Exchange ended down 1.8 percent at $6,840 a tonne from an earlier $6,809, its lowest since May 31. Meanwhile a resumption of dollar strength and weaker than expected Chinese economic data last week also weigh.

Soybean

U.S. soybean futures plunged to their lowest level in nearly a decade on Tuesday as escalating trade tensions between the United States and China, the world's biggest soy buyer, prompted fund-driven selling, analysts said.

Chicago Board of Trade July soybeans settled down 19-1/2 cents at $8.89 per bushel after diving to $8.41-1/2, the lowest spot price on a continuous chart since December 2008. The new crop November contracts fell 20-1/2 cents to $9.11 per bushel.

Dealing Room, ICBC Beijing Branch
                        Li Nan