US open: Dow down over 80 points as tumbling oil price weigh on stocks

US stocks declined on Monday as tumbling oil prices weighed on energy stocks.

Just before 10:00 in New York, the Dow Jones Industrial Average was 81.27 points down, while the S&P 500 dropped 4.51 points, though the Nasdaq gained 2.23 points.

Oil prices continued to fall, with West Texas Intermediate losing almost 3.5% to just over $49 a barrel, while Brent crude dropped almost 2.5% to just under $59 a barrel.

The only economic data released on Monday is existing home sales in January which is expected to see a slight drop to 5.03m from 5.04m in December.

Investors are therefore likely to focus on Federal Reserve’s chair Janet Yellen, who will give her testimony on the economy and monetary policy to Congress on Tuesday and Wednesday, with investors set to look out for comments on the Fed’s interest rate policy.

On Friday, Wall Street registered late gains driven by news that Eurozone ministers had agreed to extend Greece’s bailout.

However, Athens must present a list of cuts and economic reforms by Monday, which will then have to be approved by the International Monetary Fund and by the European Union.

“US equities largely outperformed those in Europe for the first three weeks of February, snapping back sharply from a downturn in January,” said Jasper Lawler, analyst at CMC Markets.

“Now that the situation in Greece is set to calm down for a few months while a longer term solution is reached, there is chance that Europe will again attract a bigger chunk of flows.

“More flows into Europe could leave US markets susceptible to lost upward momentum and perhaps even another downturn as was seen in January.”

In corporate news, Valeant surged after announcing on Sunday that it will buy Salix in a deal worth $10bn in cash, while Apple edged forward after revealing it will invest $1.92bn to build two data centres in Europe.

Hi-tech group Polypore International jumped after sector peer 3M said it would pay $1bn for its separations media business.

Gold futures fell 0.43% to $1,199.70 ,while the dollar fell 0.1% against the pound and the yen but rose over 0.5% against the euro.