The Australian sharemarket slipped lower again today as investors remained on high alert to simmering geopolitical tensions and increased eurozone credit market risks.
The S&P/ASX 200 index slipped 15.5 points, or 0.28 per cent, to 5540.9 as the bailout of Portugal's Banco Espirito Santo served merely to act more as a "canary in a coalmine" than soothe investor jitters.
Volume was well below average because of a NSW public holiday, but domestic sentiment was supported by a 0.6 per cent bounce in June retail sales, up from the 0.3 per cent decline in May.
Despite reassuring investors a few weeks ago the bank was fine, the Bank of Portugal announced it would inject 4.9 billion euro ($7.1 billion) into the insolvent lender, an amount well in excess of the rumoured 3 to 4 billion euro.
The Australian dollar rose US0.3 cents to US93.20 cents and government 10-year yields dropped 2.4 points to 3.493 per cent after Friday's US non-farm payroll report calmed market fears of a US rate rise early next year.
The "solid but not spectacular" report showed in July 209,000 jobs were created, well short of the 230,000 forecast and 296,000 in June, while there was also improved manufacturing data and car sales.
The Shanghai composite index was up 1 per cent at the close of the ASX on rumours the Chinese government would accelerate reforms on state-owned enterprises as part of the much needed rebalancing of the economy.
In Tokyo the Nikkei index was 0.1 per cent easier.
Spot iron ore eased to $US95.20 on Friday while Dalian iron ore futures were up 0.3 per cent today.
Gold rose $US7 to $US1292 an ounce and copper lost 0.5 per cent to $US7080 a tonne.
New figures showing a jump in local retail spending in June also allayed fears of weak consumer sentiment, Australian Stock Report senior equity analyst Benny Sada said.
"The fact we are seeing Aussies continuing to spend provided a degree of support for the market as well,” Mr Sada said.
Shares in major retailers were mixed, with Myer adding 3 cents to $2.38 and JB Hi-Fi gaining 15 cents to $19.75, but Harvey Norman dropped 1 cent to $3.05.
Roc Oil hit a four-and-a-half year high, gaining 4.5 cents, or 7.1 per cent, to 67.5 cents, after spurning a merger with Horizon Oil and accepting a cash takeover bid from China’s Fosun International.
Penfolds maker Treasury Wine Estates jumped 20 cents, or 4 per cent, to $5.15 after US private equity firm KKR lifted its takeover offer to almost $3.4 billion.
James Packer’s Crown Resorts dropped 18 cents to $15.82 after announcing a fresh bid to enter the Las Vegas casino market through the purchase of a site on the famous Strip.
The big four banks all lost ground, while mining giants were mixed.
The broader All Ordinaries index was down 14.3 points, or 0.26 per cent, at 5,533.3.
The September share price index futures contract was 15 points lower at 5,484 points, with 24,526 contracts traded.
National turnover was 1.6 billion shares worth $2.7 billion.