* Fed Chair Yellen to speak at Jackson Hole on Friday
* Oil prices drop 3 pct; dollar rises for second day
* Medivation jumps on $14 bln Pfizer deal
* Indexes down: Dow 0.46 pct, S&P 0.36 pct, Nasdaq 0.25 pct (Updates to open)
By Yashaswini Swamynathan
Aug 22 (Reuters) - Wall Street opened lower on Monday as oil prices dropped the most in four weeks and investors weighed the prospects of an interest rate hike in the coming months.
Oil prices fell nearly 3 percent as China ramped up exports of refined products, U.S. producers added rigs for an eighth consecutive week, and prospects emerged for increased exports from Iraq and Nigeria.
With the earnings season coming to an end, investor focus will shift to Federal Reserve Chair Janet Yellen’s speech on Friday at the annual central bankers’ meeting in Jackson Hole, Wyoming.
“The markets will start to get a little bit nervous about what’s going to be said, what kind of indications will be given about a September hike,” said Robert Pavlik, chief market strategist at Boston Private Wealth in New York.
The case for an imminent rate hike was strengthened by Fed Vice Chairman Stanley Fischer’s comments that the U.S. economy was close to hitting job and inflation targets.
New York Fed president and permanent voting member William Dudley said last week that a hike as soon as next month was possible.
The dollar index rose for the second day, after five straight sessions of losses.
Traders have priced in an 18 percent chance of a rate hike for September and a 40.6 percent chance for December, according to the CME Group’s FedWatch tool.
Eight of the 10 major S&P 500 indexes were lower, with the energy sector dropping the most by 1.19 percent, followed by a 0.67 percent fall in materials.
Oil major Exxon and Chevron fell about 0.8 percent and were among the top drags on the S&P 500 and the Dow.
At 9:36 a.m. ET (1336 GMT), the Dow Jones industrial average was down 84.71 points, or 0.46 percent, at 18,467.86.
The S&P 500 was down 7.87 points, or 0.36 percent, at 2,176.
The Nasdaq Composite was down 13.34 points, or 0.25 percent, at 5,225.03.
Medivation shares jumped 20 percent after agreeing to be bought by Pfizer for $14 billion. The stock gave the biggest boost to the Nasdaq. Pfizer’s shares were marginally lower at $34.85.
Syngenta’s U.S.-listed shares rose nearly 11 percent after a U.S. national security panel cleared ChemChina’s $43 billion takeover of the Swiss pesticides and seeds group.
Chipmaker Intersil jumped 23.4 percent $19.28 after a source told Reuters that Japan’s Renesas was in the final stages of negotiations to acquire the company for about $2.99 billion.
Valeant’s U.S.-listed shares rose 4 percent after the Canadian drugmaker named a new chief financial officer.
Declining issues outnumbered advancing ones on the NYSE by 1,836 to 800. On the Nasdaq, 1,456 issues fell and 785 advanced.
The S&P 500 index showed five new 52-week highs and no new lows, while the Nasdaq recorded 24 new highs and six new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Don Sebastian)