UPDATE 2-Australia retailer Myer's shares slide on debut

* Shares start down 5.4 pct in broader market down 2.0 pct

* Global market sell-off dampens debut

* Seen as negative sign for other pending IPOs (Adds analyst comment, details)

MELBOURNE, Nov. 2 - Shares in department store chain Myer Holdings Ltd tumbled as much as 8 percent on their debut in its $2 billion float, Australia's biggest in two years, a disappointing signal for other retailers with IPOs waiting in the wings.

Myer shares fell from the offer price of A$4.10, itself near the bottom of the initial offer range, and fund managers said other private equity firms waiting to exit retail companies would have to price their offerings carefully.

"It might put a bit of pressure on the valuation band, and pricing that is expected or achieved, for investors to be persuaded," said Karara Capital investment manager Akshay Chopra.

"It tells you the interest was a bit soggy to begin with, and I'm not sure how much difference it would have made even if the (broader) market was up today," Chopra said.

Myer shares opened at A$3.88 and touched a low of A$3.74, compared with a 2 percent fall in Australia's benchmark index. Shares in Myer's main rival, upmarket department store chain David Jones Ltd, were down 1.5 percent.

Myer's price had already been pushed to the bottom end of an indicative range by market turbulence over the past week and fund managers' disdain for what was seen by some as a rich valuation.

About 50 percent of the Myer offering was allocated to retail investors.

Myer's float was widely seen as a test for a rush of private equity firms wanting to exit their holdings in coming months.

Camping and outdoor clothing chain Kathmandu has launched a A$374.9 million IPO, due to start trading on Nov. 18, and Ascendia, owner of the Rebel Sports sporting goods chain, aims to launch in the new year.

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Retailers are cautiously optimistic about sales for the crucial Christmas season. Confidence levels have not been dented by the recent rise in official interest rates, and the Australian government on Monday slashed its forecasts for unemployment, which should help underpin consumer sentiment and spending.

For Myer, the two-month Christmas and summer holiday trading period is critical, accounting for about 40 percent of earnings.

Myer's private equity owners TPG Capital and Blum Capital, which bought the chain in 2006, sold out their entire stake in the IPO.

Some investors have been wary of companies floated by private equity firms, given some poor performances, such as drilling services company Boart Longyear Ltd, which trades at less than a quarter of its 2007 listing price.

Underwear group Pacific Brands is trading at half its 2004 offer price.

Myer's A$4.10 offer price reflected a price-to-earnings ratio of 15.1, below that of David Jones at 17 times forecast earnings.

Macquarie Capital, Goldman Sachs and Credit Suisse were joint lead managers to the offer.

Myer has 65 stores across Australia, nearly double David Jones' 36 stores, and has some 3 million shoppers a week through its doors.