GLOBAL MARKETS-Bond yields slip again as flight to safety goes on

* U.S. stocks up slightly in early trading
* Oil prices down in volatile trading
* Bond rally drives yields lower

(Updates with early U.S. market activity, changes dateline;
previous LONDON)
By Caroline Valetkevitch
NEW YORK, June 3 (Reuters) - A flight to safe-haven assets
pushed U.S. Treasury yields to their lowest levels since
September 2017 on Monday, while gold hit a 10-week high.
Market uncertainty has sent investors fleeing for safety,
including low-risk debt, to seek protection from market
volatility as trade conflicts between the United States and its
trading partners have deepened. Yields on U.S. two-year notes US2YT=RR are on track for
their biggest two-day fall since 2008, while U.S. benchmark
10-year Treasury yields US10YT=RR earlier hit 2.071%, their
lowest level since September 2017. German government bond yields
fell to an all-time low.
The gloomy economic outlook has prompted traders to increase
bets that the U.S. Federal Reserve will cut interest rates
sooner rather than later.
The U.S. dollar fell and hit a 4 1/2-month low against the
Japanese yen and a two-month low against the Swiss franc.
"Though we think the recent warning shot toward Mexico could
be resolved, the road ahead on the global trade front is likely
to remain challenged until the G20 later this month," wrote Mark
McCormick, global head of foreign exchange strategy at TD
Securities.
In addition to increasing tariffs on Chinese imports in
recent weeks, the White House has hardened its stance toward
other countries, including Mexico.
Nonetheless, global stock markets edged higher on Monday
after a torrid May that wiped $3 trillion off global equities.
The Dow Jones Industrial Average .DJI rose 41.92 points,
or 0.17%, to 24,856.96, the S&P 500 .SPX gained 2.2 points, or
0.08%, to 2,754.26 and the Nasdaq Composite .IXIC dropped
37.16 points, or 0.5%, to 7,415.99.
The pan-European STOXX 600 index .STOXX rose 0.26% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.39%.
In commodities, spot gold XAU= added 1.1% to $1,319.22 an
ounce, while U.S. crude oil CLcv1 fell 0.36% to $53.31 per
barrel. RISING TENSIONS, FALLING ACTIVITY
With the bitter trade mood weighing, factory activity
contracted in most Asian countries and the euro zone last month,
surveys showed. On Monday, the Institute for Supply Management said its
gauge of U.S. manufacturing activity unexpectedly fell to its
weakest level in more than 2-1/2 years in May amid global trade
tensions. A senior Chinese official and trade negotiator said on
Sunday that the United States could not use pressure to force a
trade deal, refusing to be drawn on whether the leaders of the
two countries would meet at the G20 summit later this month.
The standoff between the world's two largest economies goes
beyond trade, with tensions running high ahead of the 30th
anniversary of a bloody Chinese military crackdown on protesters
around Beijing's Tiananmen Square.

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Korea exports https://tmsnrt.rs/2Kn47VJ
Messy May for global markets https://tmsnrt.rs/2WJboFV
US 2-year yield in biggest two day fall since 2008 crisis https://tmsnrt.rs/2WFaY3b
Asian stock markets : https://tmsnrt.rs/2zpUAr4
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