Financial Watch

Oil prices dropped for the third straight day in New York on Thursday, amid continuing worries about the stability of the eurozone and a stunning sell-off in the US financial markets.

Crude futures had nudged higher earlier in the day but headed south as the euro dropped under 1.27 dollars, reaching the lowest level since March 2009.

New York’s main contract, light sweet crude for delivery in June, closed down 2.86 dollars to 77.11 dollars a barrel. Over the last three trading sessions, it has fallen 10.5 percent.

Stocks fell Tuesday on Wall Street as Greece’s debt problems and China’s economy again have investors concerned about economic growth.

Upbeat earnings and outlooks from the industrial giants DuPont, 3M and Ford have helped to moderate the losses. Strong first-quarter earnings have sent stocks higher in recent weeks.

In early trading, the Dow Jones industrial average was down 11.18, or 0.1 percent, at 11,193.85. The Standard & Poor’s 500-stock index was down 0.4 percent and the Nasdaq composite index was off 0.3 percent.

Financial shares dragged the stock market lower Friday as investors worried that the government’s mortgage-related fraud charges against Goldman Sachs & Co. could mean intensified scrutiny for the industry.

The Securities and Exchange Commission accused the Wall Street powerhouse of failing to disclose conflicts of interest in selling certain mortgage investments that led to steep losses for clients. Goldman Sachs denied the allegations.

The federal agency also said it was looking into a wide range of practices related to the subprime mortgage crisis, prompting fears that the investigation could broaden.

US stocks drifted higher on Monday amid uncertainty over fraud charges against top Wall Street bank Goldman Sachs.

The Dow Jones Industrial Average rose 25.02 points (0.23 per cent) to 11,043.68, recovering from a more than 100 points’ plunge on Friday when the Securities and Exchange Commission (SEC) announced civil fraud charges on Goldman.

A U.S. stock rally evaporated abruptly yesterday as a strengthening dollar sapped gains in commodities and related shares, largely overtaking bullish sentiment that came with upbeat results in retail and technology sectors.

“The volume is light enough that swings can be pretty dramatic even in the last half hour, where we saw the dumping of lots of energy and material names,” said Owen Fitzpatrick, head of the U.S. equity group at Deutsche Bank.

The stock market may be sitting near 18-month highs, and volatility has declined sharply, but that doesn’t mean investors aren’t worried about a downturn in the market.

Volatility has declined to a 22-month low, making it cheap for investors to bet on or hedge against a big drop in the market by buying S&P index put options as a hedge.

The Chicago Board Options Exchange Volatility Index, Wall Street’s favourite yardstick of investor sentiment, fell to a low of 16.21 on Tuesday, near levels not seen since May 2008, just prior to the steepest part of market sell-off.