Widespread selling sent the share market to a second consecutive fall, while stronger than expected retail sales growth lifted the Australian dollar.
The benchmark S&P/ASX200 index dropped 0.5 per cent to 6,067.6 points, and the local currency hit a high of 78.86 US cents, its best level since October.
CommSec market analyst Steven Daghlian said the main weight on the share market was the financial sector, though there was no key driver behind its fall.
Retail sales rose 1.2 per cent in November, beating expectations of a rise of 0.4 per cent, driven by the release of the iPhone X and promotions such as Black Friday.
“Retail stocks are the standout, in particular JB Hi-Fi, partly off the back of a broker upgrade and a much stronger than expected lift in retail spending,”Mr Daghlian said.
An upbeat Morgan Stanley report had JB Hi-Fi shares higher before the release of the sales numbers, and they ended the session 4.4 per cent higher at an 11 month high of $27.99.
Harvey Norman gained 1.4 per cent to $4.38 and auto and sports retailer Super Retail Group added 3.5 per cent to an eight month high of $8.77.
The supermarket giants were mixed, with Woolworths up 0.4 per cent and Coles owner Wesfarmers down 0.5 per cent.
The Australian dollar jumped one third of a cent when the retail figures were released, and surged again to its intra-day high late in the afternoon.
Among the big four banks, ANZ shed 0.2 per cent, Westpac dropped 0.5 per cent and Commonwealth Bank fell 0.4 per cent, while National Australia Bank gained 0.1 per cent.
Rio Tinto was steady, while BHP Billiton and Fortescue Metals each dropped 0.4 per cent.
Gold miners were boosted by a stronger price for the precious metal, with Newcrest Mining up 0.7 per cent at $22.81 and Evolution Mining up 1.2 per cent at $2.52.
ON THE ASX:
* The benchmark S&P/ASX200 was down 29.1 points, or 0.48 per cent, at 6,067.6 points at 1630 AEDT.
* The broader All Ordinaries index was down 29.7 points, or 0.48 per cent, at 6,176.2 points
* The SPI200 futures contract was down 32 points, or 0.53 per cent, at 6,014 points
* National turnover was 3.8 billion securities traded worth $5.8 billion.
CURRENCY SNAPSHOT AT 1700 AEDT:
One Australian dollar buys:
* 78.74 US cents, from 78.14 US cents on Wednesday
* 88.04 Japanese yen, from 87.50 yen
* 65.87 euro cents, from 65.51 euro cents
* 58.33 British pence, from 57.80 pence
* 109.41 NZ cents, from 109.10 NZ cents
The spot price of gold in Sydney at 1700 AEDT was $US1,317.78 per fine ounce, from $US1,309.78 per fine ounce on Wednesday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 4.50 per cent April 2020, 2.0335pct, from 2.0114pct on Wednesday
* CGS 4.75pct April 2027, 2.6814pct, from 2.6683pct
Sydney Futures Exchange prices:
* March 2018 10-year bond futures contract at 97.265 (implying a yield of 2.735pct), from 97.28 (2.72pct) on Wednesday
* March 2018 3-year bond futures contract at 97.825 (2.175pct), from 97.85 (2.15pct).
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)