* Goldman cuts Boeing to sell rating
* Valeant, Salix agree to merger deal
* Indexes off: Dow 0.24 pct, S&P 0.16 pct, Nasdaq 0.16 pct (Adds data, updates prices)
By Chuck Mikolajczak
NEW YORK, Feb 23 (Reuters) - U.S. stocks edged lower in morning trading Monday amid weakness in oil prices, after a conditional agreement by euro zone finance ministers to extend Greece’s bailout sent the Dow and S&P to record levels last week.
Oil prices fell, with Brent down 0.9 percent to $59.68 and WTI crude off 2.4 percent at $49.61 a barrel on oversupply concerns and a stronger dollar, pulling the S&P energy index down 0.5 percent.
Housing stocks lost ground, with the PHLX housing sector index off 0.2 percent after existing home sales fell sharply to their lowest in nine months in January.
Investors were also reluctant to make big bets before Federal Reserve Chair Janet Yellen’s semiannual testimony on the economy and monetary policy before the Senate Banking Committee, which will be closely watched for any indications on the timing of an interest rate hike.
“(Housing data) is hard to forecast in the context of Yellen talking tomorrow as well, because we may be in another one of these periods where weakness is a good thing before it forestalls the Fed a little bit longer,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.
“It really is just waiting on the comments tomorrow.”
Greece will present its economic reform plans on Monday to seal the euro zone financial lifeline, but the government drew criticism from a veteran leftist and ruling party member that the deal let voters down. The deal is conditional on the country’s European and IMF creditors accepting a list of reforms drawn up by Greece.
The equity market gains had led each of the three major Wall Street indexes to their third weekly advance on Friday, with the Nasdaq on an eight-session winning streak as it closed in on the 5,000 mark for the first time in nearly fifteen years.
The Dow Jones industrial average fell 44.15 points, or 0.24 percent, to 18,096.29, the S&P 500 lost 3.46 points, or 0.16 percent, to 2,106.84 and the Nasdaq Composite dropped 7.90 points, or 0.16 percent, to 4,948.06.
Boeing fell 2.7 percent to $154.10 as the biggest drag on the Dow after Goldman Sachs cut its rating on the aircraft maker to “sell” from “neutral.”
Canada’s Valeant Pharmaceuticals International Inc agreed to acquire gastrointestinal drugmaker Salix Pharmaceuticals Ltd in an all-cash deal valued at about $10.1 billion, the companies said on Sunday. U.S. listed shares of Valeant gained 13.2 percent to $196.14 while Salix slipped 1.1 percent to $156.06.
Declining issues outnumbered advancing ones on the NYSE by 1,756 to 1,180, for a 1.49-to-1 ratio on the downside; on the Nasdaq, 1,660 issues fell and 908 advanced for a 1.83-to-1 ratio favoring decliners.
The benchmark S&P 500 index posted 59 new 52-week highs and no new lows; the Nasdaq Composite recorded 84 new highs and 24 new lows.
Editing by Bernadette Baum