The week seemed to start positively for investors after Europe's finance leaders agreed to lend Spain up to ?100 billion ($126 billion) to prevent a collapse of its banking system. But the anticipated rally on Tuesday turned into a fizzer after investors in the US (down 1.3 per cent) and London (flat) failed to get excited.
That set the tone for the week. As it wore on, local investors lost more enthusiasm as attention turned from Spain to Greece, with uncertainty weighing heavily about the outcome of the Greek elections to be held this Sunday.
"It used to be after one of these bailouts you'd get a month's worth of good reaction. Now $100 billion buys you 24 hours," Andrew Pease, the chief investment strategist at Russell Investment Group, told the markets blog this week.
Yesterday morning the market was buoyed by reports Europe's leaders were willing to steady financial markets if Greece's elections produced market turmoil. The Australian dollar enjoyed a little support from the boost in sentiment.
"This [was] not a promise to loosen monetary policy but at least it provides fresh hope for those wanting to punt on a near-term bounce in equities and risk currencies," a Westpac currency strategist, Sean Callow, said.
We'll have to wait until 4am Monday to get preliminary results of the election. By 11am we will have a clearer idea of the outcome.
For the week, the benchmark S&P/ASX200 fell 6.4 points to 4057.3 despite closing up 15 points yesterday. The All Ordinaries fell 3.8 points for the week but rose 17 points on Friday.
An OptionsXpress market analyst, Ben Le Brun, said the total value of shares traded on the local bourse on Friday were at about half the daily average.
"We're up but it's on absolutely no conviction whatsoever," Mr Le Brun said. "Overall, we are very much on hold for the Greek elections."
Mr Le Brun said there was potential for good news arising from the elections in Greece in that it could inspire some swift policy action in relation to the troubled eurozone and see Greece stay with the euro.
"But no one is prepared to take a bet on it at this stage - that's why [share] volumes are so absolutely miserable at the moment."
In the resources sector, the global miner BHP Billiton rose 4? to $31.84, and Rio Tinto rose 23? to $54.50.
Coalworks was up 2? at $1.005 after it said it would recommend to its shareholders an improved takeover offer from Whitehaven Coal. Whitehaven, which itself is the target of a takeover offer from the billionaire Nathan Tinkler, has agreed to an amendment that will lift its $142 million takeover offer to $145.6 million.
Among the major banks, ANZ was 8? lower at $21.28, Westpac rose 5? to $20.34, National Australia Bank was up 6? at $22.12, and Commonwealth Bank rose 32? to $50.89.
Among other stocks, the casinos operator Echo Entertainment was still in a trading halt at $4.49 after it said it would seek to raise $454 million via the issue of new shares as it deals with an expected fall in earnings of up to 39 per cent.
The share registry Computershare fell 23? to $7.57 after it said it would sell British-based Flag Communication to interests associated with the chairman, Chris Morris, for #400,000 ($624,951).