* C$ ends weaker at C$0.9806 vs US$, or $1.0198 * Concern about Spain bailout offsets strong retail data * Bond prices turn negative across the curve * July retail sales jump by 0.7 percent from June By Andrea Hopkins TORONTO, Sept 25 (Reuters) - The Canadian dollar ended slightly weaker against its U.S. counterpart on Tuesday as global worries about a Spanish bailout outweighed the currency's early rally on strong Canadian retail sales data. The euro and world stock markets came under pressure late in the day as investors fled riskier assets on concerns about global growth and a bailout for debt-laden Spain. Spain told euro zone finance ministers on Friday it will set clear deadlines for structural reforms by the end of the month, a move European diplomats said would pave the way for an aid request before long to help it tackle its debt pile. Madrid's borrowing costs have fallen sharply since the European Central Bank said it was ready to buy Spanish bonds, but big borrowing needs before the year-end and a deepening recession have made most analysts and policymakers believe it is only a matter of time before it will require help. The gloom over Spain more than offset data that showed strong Canadian retail sales in July, an unexpectedly bullish sign that spurred the Canadian dollar to a session high. "It's been a funny day. CAD initially rallied on fundamental domestic data - retail sales data that were stronger than expected - but since then the more global theme of Europe has resurfaced and CAD has lost its rally," said Camilla Sutton, chief currency strategist at Scotiabank. "In the last couple of hours, euro has dropped lower on the back of rising expectation that Spain is about to ask for a bailout and that the reforms will be quite strict. And so as we've seen euro dip lower here, we've also seen CAD weaken off." The Canadian dollar ended the day at C$0.9806 versus the U.S. dollar, or $1.0198, down from Monday's North American session finish of C$0.9788, or $1.0217. The session high was C$0.9756, hit as traders took the retail sales data as a sign of consumer strength after a string of soft economic indicators. Retail sales jumped by 0.7 percent from June to a near record C$38.99 billion in July, in part due to higher sales of new cars. The increase was far greater than the modest 0.1 percent advance forecast by market analysts. "If anything it means consumers aren't on a downward spiral," said Emanuella Enenajor, economist at CIBC World Markets. But she cautioned that the report doesn't change the fact that consumers still face significant headwinds, including the slow pace of hiring, decelerating consumer credit and elevated debt loads. Canadian government bond prices were mixed across the curve. The two-year bond fell 2 Canadian cents to yield 1.125 percent, while the benchmark 10-year bond lost 3 Canadian cents, yielding 1.819 percent. The 30-year bond added 20 Canadian cents to yield 2.381.