Source: Sharecast
As of 1915 BST, the Bloomberg commodity index was down by a whopping 1.26% to 86.22, even as the US dollar spot index dipped 0.26% to 94.2740.
Responding to a threat from the White House on Friday to impose a 20% tariff on cars made in the European Union, the next day Commission vice President Jyrki Katainen told French daily Le Monde "If they decide to raise their import tariffs, we'll have no choice, again, but to react."
In turn, come Sunday the US President put all countries that had placed artificial trade barriers and tariffs on US goods on notice.
His remarks were followed by a report in the Journal (which some analysts had anticipated) that the White House was set to impose further restrictions on Chinese investment in certain technology companies.
Against that backdrop, agricultural futures were bearing the brunt of selling, with the September CBoT corn contract down 2.18% at $3.5850 a bushel, alongside a fall of 2.83% to $1.0290/lb. for CME live cattle.
Base metals were also weaker, with three-month LME copper futures dropping from $6,820 per metric tonne at the opening bell to $6,755 by the end of trading.
That was despite a 50 basis point cut in the People's Bank of China's reserve requirement ratio on Sunday.
"Over the weekend, the PBOC announced a reduction in the banks’ reserve rate ratio effective 5th July – one day before the US deadline to impose tariffs on a raft of Chinese goods. The RRR cut would usually be market positive but in the current nervous conditions, the selloff in China stocks resumed and the Yuan value weakened," said traders at Sucden Financial.
To take note of, gold and silver prices were continuing to drip lower, with August 2018 COMEX gold off by 0.17% to $1,268.50/oz..
Energy futures were also in the red, albeit only after they had surged on Friday, amid investor confusion about the extent of any probably increase in output from OPEC and its allies.
Earlier during that session, the cartel had promised to stop under-producing, but without specifying the amount of any increase.
That prompted Saudi energy minister Khalid al-Falih to say on Saturday that together, OPEC and non-OPEC countries would produce an extra 1.0m barrels of oil a day.
Brent crude futures for front month delivery gave back 1.09% to trade at $74.73 a barrel.
