* Goldman stock plunges nearly 13 percent on SEC charges
* Euro snaps 5-day winning streak on renewed Greek fears
* US Treasuries rally with 10-year note at 3.77 percent
(Updates with U.S. market close; quotes on Goldman Sachs)
By Jennifer Ablan
NEW YORK, April 16 (Reuters) - World stock markets dropped
on Friday after U.S. regulators charged Goldman Sachs Group
Inc. <GS.N> with fraud related to subprime mortgages, while the
euro dropped on worries about Greece's debt crisis.
Investors moved money into safe-haven U.S. government debt,
pushing prices higher and yields lower.
World equities moved in sympathy with U.S. stocks, which
were under severe selling pressure as financial issues plunged
on the charges against Goldman Sachs and some disappointing
earnings. The decline was the market's biggest in nearly two
months, taking the shine off a six-day winning streak.
Goldman <GS.N> fell nearly 13 percent in its worst one-day
drop since January 2009, to $160.70 on huge volume after the
Securities and Exchange Commission sued it for fraud tied to
collateralized debt obligations that contributed to the worst
financial crisis since the Great Depression. For details see
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"It's going to take a while for the markets to digest this
as investors weed out what it could mean for Goldman and if
other banks could be hit with something similar," said Tom
Lydon, president of Global Investment Trends in Newport Beach,
California.
Defaults on subprime mortgages and the unraveling of
related derivatives and debt played a major role in the credit
crunch that led to a meltdown on Wall Street and the worst U.S.
recession since the 1930s.
At the close, the Dow Jones industrial average <> was
down 125.91 points, or 1.13 percent, at 11,018.66, while the
Standard & Poor's 500 Index <.SPX> was off 19.54 points, or
1.61 percent, at 1,192.13. The Nasdaq Composite Index <>
lost 34.43 points, or 1.37 percent, at 2,481.26.
The MSCI's global equity index <.MIWD00000PUS> settled down
1.57 percent, though still set for its seventh straight weekly
gain. The pan-European FTSEurofirst 300 <> also was down
1.52 percent.
Overall, global shares edged off 16-month highs as
persistent uncertainty over Greece's ability to pay its debts
tempered optimism over the global economic recovery.
In currencies, the dollar was up against a basket of major
trading-partner currencies, with the U.S. Dollar Index <.DXY>
up 0.37 percent at 80.778 from a previous session close of
80.482.
The euro remained pressured and Greek bond yields rose
after Athens said it was preparing to activate an IMF/EU
financial aid package. [].
The euro <EUR=> was down 0.54 percent at $1.3506 from a
previous close of $1.3579.
Against the Japanese yen, the dollar <JPY=> was down 0.95
percent at 92.11 from a previous session close of 92.990.
GREECE MOVES
The euro snapped a five-day winning streak due to renewed
worries over Greece's ability to service its sovereign debt.
Greece lurched closer toward asking for international aid
after it requested official talks with European authorities and
the International Monetary Fund.
European Central Bank President Jean-Claude Trichet told
euro zone finance ministers that the situation for Greek banks
remains difficult and could deteriorate further.
[]
The cost of insuring Greek sovereign debt rose about 10
basis points from Thursday's close to 428.5 bps, according to
CMA DataVision. Greek 10-year bond yields <GR10YT=TWEB> rose to
7.4 percent, widening the 10-year Greek/German government bond
yield spread.
U.S. Treasury debt, investors' favorite safe haven, rose.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was up
17/32, with the yield at 3.77 percent, while the 2-year U.S.
Treasury note <US2YT=RR> was up 3/32, with the yield at 0.96
percent. The 30-year U.S. Treasury bond <US30YT=RR> was up
22/32, with the yield at 4.67 percent.
In energy and commodities trading, U.S. light sweet crude
oil <CLc1> fell $2.40, or 2.81 percent, to $83.11 per barrel,
and spot gold <XAU=> fell $21.35, or 1.84 percent, to $1136.60.
The Reuters/Jefferies CRB Index <.CRB> was down 3.46 points, or
1.24 percent, at 276.29.
(Additional reporting by Rodrigo Campos in New York and
Sebastian Tong in London; Editing by Dan Grebler)
