* GRAPHIC-2019 asset returns:
* Manufacturing PMIs highlight problems ahead (Updates with official prices, ISM data and dollar impact)By Pratima DesaiLONDON, June 3 (Reuters) - Copper prices touched five-monthlows on Monday, pressured by the escalating trade disputebetween the United States and China and concerns over the damageto manufacturing activity and demand for industrial metals.Benchmark copper on the London Metal Exchange (LME)ended up 0.2% at $5,842 a tonne as funds took profits on shortpositions - bets on lower prices. Earlier prices hit $5,801, thelowest since Jan. 4."Pessimism has taken hold. A recovery will need an end, orat least conciliatory moves, between the two sides," a fundmanager trading metals said in reference to the U.S.-China tradedispute. "Manufacturing PMIs show the decline in activity, theoutlook for industrial metals doesn't look good."Copper prices on the Shanghai Futures Exchange fellto a two-year low at 46,050 yuan.
HIT LIST: China on Friday threatened to unveil anunprecedented hit list of "unreliable" foreign businesses,groups and individuals that harm the interests of Chinesecompanies. On Saturday it imposed additional levies on themajority of U.S. imports on a $60 billion target list."These actions could be viewed as putting China back on to alevel playing field," ING analysts said in a note."The U.S. should now know that suppressing China will resultin bounce-back retaliation from China. Whether this willencourage the U.S. to go back to the negotiation table is hardto gauge."CHINA: Factory activity in China expanded at a modest pacein May, a private survey showed, but analysts say thatfront-loading of exports to the United States in an effort toavoid higher tariffs masked underlying weakness in the economy. EURO ZONE: Manufacturing activity in the euro zonecontracted for a fourth month in May and at a faster pace, asurvey showed. ISM: The Institute for Supply Management's U.S.Manufacturing Purchasing Managers Index slipped to 52.1 from52.8 in April, marking the lowest level since October 2016.Expectations had been for a number at 53. DOLLAR: A weaker U.S. currency makes dollar-denominatedmetals cheaper for holders of other currencies. This is arelationship used by funds to generate buy and sell signals.POSITIONS: "The copper net speculative short position hasinched up to 7.4% of open interest, or 13,000 lots, largely backto levels not seen since October," Marex Spectron analysts saidin a note. One lot is 25 tonnes. "Last year the short in copperpeaked at 30% of open interest on July 19."PRICES: Aluminium ended down 1% at $1,777 a tonne,zinc lost 2.2% to $2,468, lead rose 0.3% to $1,810 andtin gained 2.3% to $19,150. Nickel was untradedat the close, but was down 1.2% at $11,880 in electronic trade.<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Pratima DesaiEditing by Mark Heinrich)