What you need2know

SPI futures down 19pts to 5534

AUD at 76.32 US cents, 93.67 Japanese yen, 68.88 Euro cents and 48.90 British pence

On Wall St, S&P 500 flat, Dow -0.2%, Nasdaq -0.1%

In Europe, Stoxx 50 -0.9%, FTSE +0.3%, CAC -1%, DAX -0.7%

Iron ore dropped 6 per cent to $US55.63 a ton

Spot gold down $US1.73, or 0.2% to $US1167.06 an ounce

Brent crude down 20 US cents, or 0.3% to $US61.81 a barrel

What's on today

Australia May retail sales, China HSBC services gauge index, US stock and bond markets closed for July 4th holiday.

Stocks in focus

UBS has a "buy" rating on Air New Zealand (AIR) and a $NZ3.15 target price. "We remain comfortable with our expected lift in Group EBIT of $126m to $692m in FY16E driven by the full-year impact of lower fuel costs coupled with relatively modest new competition on domestic and international routes, outside of China. Higher profitability should also support a strong dividend payout. We retain our Buy rating based on positive earnings momentum and supportive valuation metrics through FY16E."

RBC Capital Markets upgrades Transurban Group (TCL) to "outperform" and has a $10 target price. "The recent pullback in TCL shares has created an attractive investment opportunity in our view. Our DCF valuation moves to $9.93/share on the back of an analysis of the likely value uplift from the Western Distributor opportunity and after updating our model for the Citylink widening and acquisition of minority interests in 495/95 Express Lanes in the US. While our DPS estimates are unchanged, they imply a 12.4 per cent 3 year CAGR but with upside potential.

Credit Suisse has an "outperform" rating on Aurizon (AZJ) and a $5.80 target price.

Currencies

The greenback fell from a three-week high after a report showed US wage growth stalled in June, decreasing the chances the Federal Reserve will start lifting interest rates in September as some traders and investors had bet.

The Bloomberg Dollar Spot Index, which tracks the US currency against 10 of its major peers, declined 0.2 per cent to 1187.07 in mid-afternoon trade in New York. It is up 0.6 per cent this week.

Fed funds futures show there's a 29 per cent chance the central bank will increase its benchmark rate from near zero in September, down from 35 per cent on Wednesday, and a 67 per cent chance by December, down from 72 per cent, according to data compiled by Bloomberg.

Commodities

Iron ore exports from Port Hedland have climbed to an all-time high, helping to drive down the price of iron ore. Ore with 62 per cent content delivered to Qingdao dropped 6 per cent to $US55.63 a ton on Thursday, the biggest decline in a year, according to data from Metal Bulletin Ltd.

Three-month copper on the London Metal Exchange ended up at $US5795 a tonne from $US5775 at the close on Wednesday. "Copper should have formed a bottom around current levels. Demand is gaining momentum because the economy in China is stabilising," said Commerzbank analyst Daniel Briesemann. "My year-end target (for copper) is $US6500 a tonne."

Drillers put rigs in US oil fields back to work for the first time since December, driving down crude futures on speculation that an unprecedented retreat from the country's prolific shale formations is ending.

United States

US stocks ended slightly lower on Thursday after the International Monetary Fund warned that Greece faces a financial hole ahead of its Sunday referendum, and as muted jobs data dampened the US economic outlook. All three indexes posted losses for the week, with the S&P 500 registering its biggest weekly decline, 1.2pc, since March.

Wall Street is closed on Friday ahead of the July 4th Independence Day holiday. Trading will resume on Monday.

US job growth slowed in June and Americans left the labour force in droves, tempering expectations for a September interest rate hike. Nonfarm payrolls rose 223,000 last month, down from 254,000 in May. In addition, 60,000 fewer jobs were created in April and May than previously reported.  The unemployment rate fell two-tenths of a percentage point to 5.3 per cent, the lowest since April 2008, but that was a sign of weakness not strength as it reflected about 432,000 people leaving the labour force.

Europe

European shares fell on Thursday under pressure from concerns over Greece's debt crisis and with a rebound in the euro weighing on exporters who typically benefit from the single currency's weakness. Adding to the negative momentum was Sweden's Electrolux , which dropped after a US legal challenge to a planned takeover.

BP's $US18.7 billion settlement over the 2010 Gulf of Mexico spill draws a line under years of uncertainty to allow it to focus once again on growth but could make it an acquisition target.

In a report, the IMF said Greece will need an extra 50 billion euros over the next three years, including 36 billion from its European partners, to stay afloat. It also needs significant debt relief.

What happened yesterday

The bulls were running on the Australian sharemarket on Thursday, led by gains in bank stocks, as investors shrugged off global macroeconomic uncertainty.