Wall Street on track to open lower as US shutdown enters third day

Wall Street was set to start the week slightly lower as a U.S. government shutdown entered its third day, while investors assessed a flurry of multi-billion corporate mergers.

The Senate is set to vote at midday on Monday, following failed attempts by Democrats and Republicans to strike a deal on Sunday to fund government operations.

"It's 'Been there, done that'. We know they are actually going to get their act together and reach a deal. But the economic impact depends on how long it lasts," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

Investors also focused on a spate of deals, particularly following the recent enactment of corporate tax cuts.

Juno Therapeutics rose about 27 percent in premarket after Celgene agreed to buy the biotech for about $9 billion in cash. Celgene was down 1.22 percent.

Shares in U.S. hemophilia specialist Bioverativ soared 63 percent after French healthcare group Sanofi agreed to buy the company for $11.6 billion.

Insurer AIG said it would buy reinsurer Validus Holdings for $5.56 billion. Validus was up 45 percent.

At 8:40 a.m. ET (1340 GMT), Dow e-minis were down 49 points, or 0.19 percent, with 23,251 contracts changing hands.

S&P 500 e-minis were down 0.75 points, or 0.03 percent, with 108,775 contracts traded.

Nasdaq 100 e-minis were down 0.25 points, or -0 percent, on volume of 27,852 contracts.

The S&P 500 and the Nasdaq notched record closing highs on Friday, as investors shrugged off the threat of a shutdown and focused on upbeat quarterly earnings.

Of the 53 S&P 500 companies that reported through Friday, 79.2 percent have topped earnings estimates, according to Thomson Reuters I/B/E/S.

Halliburton Co rose 2.24 percent on Monday after posting a much bigger-than-expected quarterly profit in the fourth quarter, benefiting from a shale-driven surge in U.S. oil production.

Shares of Netflix Inc, a major contributor to the recent stock rally, were up about 1 percent ahead of its quarterly results after market closes.

The benchmark U.S. 10-year Treasury yield was close to its highest level in more than three years on Monday.

"More concern is coming from the bond market where yields are testing a long-term resistance," said Brown. "If the yields are going up, and if earnings stay the same, share prices would come down."

The week is heavy on data. Investors will get a peek into the economy's health during the fourth quarter, with GDP growth numbers and the Fed's favored inflation measure, personal consumption expenditure, due at the end of the week. — Reuters