By Barbara Kollmeyer, MarketWatch

Valeant and Salix in deal news; oil, euro tumbles

MADRID (MarketWatch) -- Wall Street appeared set to retreat on Monday from a late rally staged last week, as investors looked ahead to home-sales data and began the countdown to testimony from U.S. Federal Reserve Chairwoman Janet Yellen.

A planned acquisition by Valeant Pharmaceuticals International Inc. valuing Salix Pharmaceuticals Ltd. at roughly $10 billion could make those shares active.

Futures for the S&P 500 index (SPH5) fell 4.6 points to 2,102.50, while those for the Dow industrials (DJH5) eased 35 points to 18,069. Tech stocks were the exception, with futures for the Nasdaq-100 index (NDH5) flat at 4,438.

Need to Know: Nasdaq at 5,000 isn't a pipe dream (http://www.marketwatch.com/story/knocking-down-nasdaq-5000-as-us-dollar-sentiment-hits-extremes-2015-02-23)

The S&P 500 (SPX) and Dow industrials (DJI) both nabbed record closes on Friday, at 2,110.30 and 18,140, respectively, with weekly gains of around 0.6% for each. News that eurozone ministers agreed to extend Greece's bailout for four months (http://www.wsj.com/articles/eurozone-approves-greece-bailout-extension-1424435121?mod=mktw) helped drive late gains for Wall Street.

Still, Greece must present a list of budget cuts and economic overhauls by Monday for approval from its international lenders -- the European Commission, the European Central Bank and the International Monetary Fund.

Also read: Why Germany beat Greece in the battle of the bailout, in five charts (http://www.marketwatch.com/story/how-germany-is-walloping-greece-in-the-battle-of-the-bailout-in-5-charts-2015-02-20) (http://www.marketwatch.com/story/how-germany-is-walloping-greece-in-the-battle-of-the-bailout-in-5-charts-2015-02-20)

Yellen week: U.S. investors will find plenty to take their minds off Greece, though, as Fed Chairwoman Janet Yellen will give her semiannual testimony on the economy and monetary policy to Congress on Tuesday and Wednesday this week. Investors will be looking out for any comments on rate-hike timing, in particular.

Read: Three things Yellen could say to surprise investors (http://www.marketwatch.com/story/three-things-yellen-could-say-to-surprise-investors-2015-02-20)

Jim Reid, strategist at Deutsche Bank, said in a note that recent payrolls data could mean a "more upbeat view" of the U.S. economy, but its analysts were wondering if Yellen will make a case to Congress that the time could be nearing for the Fed to start policy normalization.

"When Yellen is about to speak, we tend to have a bias towards thinking she'll be fairly dovish, and with inflation where it is globally at the moment, this is likely to hold back any negative shock tomorrow night," Reid said in a note to investors.

On Monday, investors will get the Chicago Fed national-activity index for January at 8:30 a.m. Eastern, and existing-home sales for that same month at 10 a.m. Eastern.

Economic preview: U.S. economy's growth not touching all the bases (http://www.marketwatch.com/story/us-economys-growth-not-touching-all-the-bases-2015-02-22)

(http://www.marketwatch.com/story/us-economys-growth-not-touching-all-the-bases-2015-02-22) (http://www.marketwatch.com/story/us-economys-growth-not-touching-all-the-bases-2015-02-22) (http://www.marketwatch.com/story/us-economys-growth-not-touching-all-the-bases-2015-02-22) (http://www.marketwatch.com/story/us-economys-growth-not-touching-all-the-bases-2015-02-22)Monday deals: Valeant(VRX) said Sunday that it will buy Salix (http://www.marketwatch.com/story/valeant-pharmaceuticals-to-buy-salix-for-about-10-billion-2015-02-22-161035324)(SLXP) for about $10 billion in cash, which will take it into a multibillion-dollar market for drugs that treat stomach disorders. Shares of Valeant jumped over 6%, while Salix fell 1.1%.

3M Co.(MMM) said Monday that it has entered into a definitive agreement to buy Polypore International Inc.'s (PPO) separations media business for a total purchase price of $1 billion (http://www.marketwatch.com/story/3m-to-buy-polypore-unit-for-1-billion-2015-02-23). PPO shares jumped 3.3%, while 3M was flat.

Apple Inc.(AAPL) said Monday that it will invest EUR1.7 billion ($1.92 billion) (http://www.marketwatch.com/story/apple-to-invest-19-billion-in-european-data-centers-2015-02-23-5912328) to build two data centers in Europe that will run 100% on renewable energy -- in County Galway, Ireland and central Jutland, Denmark.

Earnings ahead:Dish Network Corp.(DISH)(DISH) reported earnings of $2.04 a share and the company said its Chief Executive Officer Joseph Clayton will retire on March 31. Dilllard's Inc.(DDS) and Express Scripts Holding Co.(ESRX) will also report Monday (http://www.marketwatch.com/story/dish-dillards-express-scripts-earnings-in-focus-2015-02-23).

(http://www.marketwatch.com/story/dish-dillards-express-scripts-earnings-in-focus-2015-02-23) (http://www.marketwatch.com/story/dish-dillards-express-scripts-earnings-in-focus-2015-02-23)Other markets:European stocks (http://www.marketwatch.com/story/european-stocks-higher-as-greek-bailout-extended-2015-02-23) got a lift from news of Greece's bailout extension, while the euro (EURUSD) fell 0.7% against the dollar after news that German business confidence improved for a fourth straight month in February, but less than expected.

In Asia, the Nikkei 225 index (http://www.marketwatch.com/story/japan-stocks-advance-for-fourth-day-to-15-year-high-2015-02-23) advanced for a fourth session to another 15-year high.

Oil prices (CLJ5) reversed an earlier gain, pushing over $1 lower, while gold (GCJ5) also fell about $9, to $1,195.30 an ounce.

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