Hedge funds slashed their bets on falling oil prices, leaving them the most bullish in two months as Opec called for a return to $80 crude.

While investors, traders, and forecasters may be on the fence as to whether the Fed pulls the trigger today on the first US interest rate hike in nearly a decade, Wall Street’s “smart money” is decisive on one thing: Market volatility will linger.

Navinder Singh Sarao, the British trader accused of helping to cause the 2010 ‘flash’ crash, was granted bail of £5m (€7m) by a London judge while he fights extradition to the US.

In today’s “rigged” US stock market, large investors such as Greenlight Capital are like “dumb tourists” led to a casino where the card games are fixed, according to Michael Lewis, whose book Flash Boys has touched off a national debate about high-frequency trading.

The US stock market is rigged in a way that benefits sophisticated traders at the expense of other investors, according to best-selling author Michael Lewis.

More banks in the UK could be caught in the scandal which saw Barclays pay £290m to settle claims that it used underhand tactics to try to rig financial markets.

The euro fell to the lowest level in more than a week against the yen as Spanish and Italian borrowing costs rose amid concern a EU summit this week will fail to solve the sovereign-debt crisis.

The chief investment officer at the US’s biggest bank is to step down after it unveiled shock $2bn (€1.55bn) losses last week.

America’s largest bank JPMorgan Chase lost $2bn in the past six weeks in a trading portfolio designed to hedge against risks the company takes with its own money.

Regulators are working closely to strengthen oversight of inner workings of the US financial system, part of a broader effort to prevent a repeat of the 2008 financial crisis, Federal Reserve chairman Ben Bernanke said.

The United States has been “asleep at the switch” and a financial regulatory upgrade is needed in the wake of Bernard Madoff’s alleged $49.4bn (€34.5bn) fraud scheme and the $692bn (€484bn) Wall Street bailout, president-elect Barack Obama said today.

The fraud investigation of fallen US financier Bernard Madoff took an unusual twist as the US attorney general removed himself from the criminal probe.

BP said it will keep the western half of its Prudhoe Bay oil field online, enabling the company to get the field up to half its prior output despite pipeline corrosion.