INVESTORS kept one eye firmly on Europe this week, and the other on China while welcoming more good news from the US.
An update on the local jobs market which showed signs of weakness was absorbed with little fuss. But economists said the Reserve Bank risked falling behind in its management of the economy if the labour market continued to deteriorate.
Investors seemed more concerned about the same big stories: Greece and the euro zone, the US economy, and prospects for economic growth in China.
And on the face of it, they seemed unhappy with the sum of things.
The benchmark S&P/ASX 200 Index slipped 61.1 points during the week, or 1.5 per cent, to 4212.
After closing the previous week on 4273.1, the sharemarket fell more than 3 per cent in the first three days of the week as market watchers digested news that China had reduced its goal for economic growth, planning for 7.5 per cent this year, rather than 8 per cent.
BHP Billiton and Rio Tinto, whose fortunes are welded to global growth, thus took a swipe to the chest. For the week, BHP was down 98? at $34.71, while Rio Tinto fell $1.80 to $64.13.
But John Abernethy, director of Clime Asset Management, said concerns about Chinese growth were overblown. "If investors are worried about China [the world's second-biggest economy] growing at 7.5 per cent and not 8 per cent, why are they not worried about Japan, which is the third-biggest economy, going backwards?" he said. "It's a mindless discussion."
But the sharemarket rebounded on Thursday morning, thanks to a positive lead from US markets overnight, after US private sector jobs rose by 216,000 last month.
At the close yesterday, the S&P/ASX 200 Index was up 41 points, or 0.98 per cent, at 4212.
Gains were across the board, except in the information technology sector, with the materials sector jumping 1.9 per cent, energy stocks gaining
1.7 per cent and financials adding 0.7 per cent.