The dollar slipped against the euro but bonds held steady as investors waited for US retail sales data which would be studied for interest-rate implications.

"US retail sales data will either confirm or contradict (Federal Reserve Chairman Alan) Greenspan's comments that the recent weakness in data is a short-term phenomenon," said Mark McFarland, currency strategist at UBS.

Investors have been recovering from last week's shock US jobs data that threw into question the sustainability of the world-leading US economy.

But they remain highly concerned about oil, viewing a long stretch of high prices as damaging to economic growth and corporate well-being.

New York crude futures were 15 cents higher at US$44,95 a barrel, (N$269,70) a tad off record levels, but IPE Brent was up 31 cents at US$41,88 after breaching its all-time high and going above US$42.

"Momentum remains bullish and a number of global uncertainties support further speculative buying," brokers Refco said in a report.

Prices are being driven up by demand from the solid world economy and supply worries linked to the Middle East, Venezuelan politics and the travails of Russia's YUKOS.

Yesterday threats by militiamen loyal to rebel Shiite cleric Moqtada al-Sadr to blow up oil pipelines if U.S.

and Iraqi government forces storm the holy city of Najaf added to the mood.

STOCKS, DOLLAR, BONDS

Solid results from German heavyweight Deutsche Telekom and industrial group ThyssenKrupp initially helped to lift European shares from 2004 lows in thin volume.

But the rally fizzled.

The FTSE Eurotop 300 index of pan-European blue chips was down 0,05 per cent and the narrower DJ Euro Stoxx 50 index lost 0,18 per cent.

Earlier, Japan's Nikkei average closed down 0,19 per cent although losses were limited by optimism over Japan's economic growth.

The broader TOPIX index slipped 0,35 per cent.

The dollar hugged tight ranges against major currencies as investors awaited the key US retail sales data.

The euro stood at US$1,2263, up about a third of a per cent.

The dollar was up a fifth against the yen at 110.75 per dollar.

On the eurozone government bond market, the two-year Schatz yield was flat at 2,468 per cent and the 10-year Bund yield was down around a basis point at 4,08 per cent.

- Nampa-Reuters

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