Australia lending data, China lending data, UK May trade stats, US Federal Reserve chair Janet Yellen speech, Canada June labour force report
Stocks in focus
RBC Capital Markets pegs Australian gold stocks as a preferred position amid the volatility in global markets. "We identify OZ Minerals (OZL) as the most likely player in the ongoing round of M&A. The company has already strongly alluded to its desire for growth via acquisition, with not only copper as a target, but also gold and other base metals."
Deutsche Bank has a "buy" on QBE Insurance and a price target of $15.15 a share.
Currencies
The safe-haven yen and Swiss franc fell after Chinese stocks rebounded and worries about Greece eased somewhat as Europe awaited reform proposals from the debt-burdened country to back its request for another three-year loan.
"The FX market is generally taking its cue from overall risk sentiment," said Mark McCormick, currency strategist at Credit Agricole in New York. "Risk-sensitive currencies such as the Aussie dollar are higher."
Chicago Fed president Charles Evans sees no need to rush a US rate hike. "Mid-2016 is where I envision the first liftoff," Evans told reporters. "I just don't see why we should be in a hurry with all of the risks that we face. A little more time doesn't hurt."
Commodities
Iron ore has snapped a 10-day slump that culminated in the biggest one-day drop in at least six years as a selloff in Chinese equities paused and most industrial metals prices climbed, easing selling pressure.
Nickel posted the biggest two-day rally since 2012, leading industrial metals higher. On the London Metal Exchange, nickel for delivery in three months rose 4.9 per cent to settle at $US11,500 a metric ton at 5.50pm, the biggest increase since October 28. In two days, the price jumped 8 per cent, the most since September 17, 2012.
Europe
Germany conceded on Thursday that Greece would need some debt restructuring as part of any new loan programme to make its economy viable as the Greek cabinet raced to finalise reform proposals to avert an imminent economic meltdown.
"Greece should be priced in by now," said Heinz-Gerd Sonnenschein, a strategist at Deutsche Postbank, in Bonn, Germany. "Most indexes in Europe entered corrections and we might have finally found a floor. It's beginning to feel like we'll be able to close this chapter and many people are looking to step back into the market."
US Market Action
US stocks closed higher on Thursday after Wall Street found relief in Beijing's efforts to halt a rout in Chinese stocks, which lifted markets around the world.
Shares of Apple bucked the market and logged their first five-day losing streak since January as investors worried that consumers in China might have less money to spend on iPhones.
Wall Street had fallen sharply in the previous session as market turmoil in China, a rout in commodity prices, the Greek debt crisis and a major outage on the New York Stock Exchange spooked investors.
China's securities regulator, in its most drastic step yet to arrest a selloff on Chinese stock markets, banned shareholders with large stakes in listed firms from selling for the next six months.
About 30 per cent has been knocked off the value of Chinese shares since mid-June. Some investors fear that the turmoil in the Chinese market could destabilise the global financial system, making it a bigger risk than the Greek crisis.
Adding to cautious optimism on Wall Street, European markets rose on hopes that Greece might be able to win a deal that could keep it in the euro zone. Greek Prime Minister Alexis Tsipras has until midnight to propose spending cut plans.
"There a relief that (China's selloff) didn't continue. There's a relief that there doesn't seem to be any belligerent tone coming out of Greece," said Steve Goldman, principal of Goldman Management in Short Hills, New Jersey.
The Dow Jones industrial average rose 33.2 points, or 0.19 per cent, to end at 17,548.62. The S&P 500 gained 4.63 points, or 0.23 per cent, to 2051.31 and the Nasdaq Composite added 12.64 points, or 0.26 per cent, to 4922.40.
All three indexes earlier traded up 1 per cent or more.
"There was a bit more optimism this morning and then just a general fallback as the day went on," said Giri Cherukuri, head trader at OakBrook Investments LLC, which oversees $US1.3 billion in Lisle, Illinois.
Seven of the 10 major S&P 500 sectors were higher, with the financial index leading the gainers with a 0.77 per cent rise.
Apple dropped 2.04 per cent to $US120.07, just over a dollar above its 200-day moving average, closely watched by traders.
On Friday, investors will look to a press conference by Federal Reserve chair Janet Yellen for new clues about when the central bank will begin to raise interest rates for the first time since 2006.
A hike in interest rates increases the cost of borrowing, crimping corporate profit margins.
Latest IMF comments
The IMF cut its forecast for global growth this year, citing a weaker first quarter in the U.S., and expressed confidence financial-market turbulence from China to Greece won't cause widespread damage.
While Greece's debt crisis will have a major effect on the country's economy, it's only 2 per cent of the euro-area's gross domestic product and hasn't produced much contagion so far, Olivier Blanchard, the IMF chief economist, said at a press briefing in Washington. China's stock-market slump is "very much a sideshow" that "doesn't reflect on the fundamentals" of China's economy, he said.
The world economy will grow 3.3 per cent in 2015, less than the 3.5 per cent pace projected in April and slower than the 3.4 per cent expansion last year, the International Monetary Fund said in revisions to its World Economic Outlook released Thursday. The fund left its forecast for growth next year unchanged at 3.8 per cent.
While the IMF left its 2015 projections for China and the euro area unchanged from April, it singled out both economies as sources of potential risk. Chinese stocks have tumbled in recent weeks and Greece is struggling to reach a deal with European creditors to stay in the euro area.
"Disruptive asset price shifts and a further increase in financial market volatility remain an important downside risk," the fund said in the report.
Much of the global downgrade was driven by the US, which the fund now sees growing 2.5 per cent this year, compared with 3.1 per cent in April.
The IMF this week reiterated its recommendation that the Federal Reserve hold off raising interest rates until the first half of next year, when wage and price inflation are expected to pick up.
The IMF characterised the US setback as "temporary," saying the world's biggest economy remains poised for an acceleration of consumption and investment as wages rise and employers hire workers.
Still, the fund warned that risks to the world recovery remain "tilted to the downside".
"The projected pickup in global growth, while still expected, has not yet firmly materialised," the fund said. "Raising actual and potential output through a combination of demand support and structural reforms continues to be the economic policy priority."
The IMF acknowledged the recent turmoil caused by faltering debt talks with Greece and a plunge in Chinese stocks.
The reaction of financial markets to the repudiation of creditor proposals by Greek voters on Sunday has been "relatively muted, with some decline in the prices of risky assets and a modest increase in the prices of safe-haven sovereign bonds", the fund said.
"In Greece, unfolding developments are likely to take a much heavier toll on activity relative to earlier expectations," the fund said.
China's benchmark equity index has plummeted 28 per cent since June 12 despite moves by authorities to freeze trading in some stocks. "Greater
difficulties in China's transition to a new growth model, as illustrated by the recent financial market turbulence," pose a risk to the global recovery, the IMF said.
The IMF reduced its projection for growth in advanced economies to 2.1 per cent, down from 2.4 per cent.
The fund left its forecast for the euro-area unchanged at 1.5 per cent, while cutting its outlook for Japan to 0.8 per cent from 1 per cent in April.
The fund left its forecast for China's expansion this year unchanged at 6.8 percent.
The IMF urged advanced economies to keep monetary policy loose to lift inflation back to target. Countries with fiscal space should increase spending, especially on infrastructure, while the need for structural reforms remains urgent across the advanced world, the fund said.
If you got to the end of this Happy Friday and Good luck with your trading day! J
