* Fed’s policy meeting scheduled on Sept. 20-21
* Perrigo rises after Starboard reveals stake
* Bank stocks drag down S&P
* Indexes down: Dow 0.26 pct, S&P 0.21 pct, Nasdaq 0.21 pct (Updates to open)
By Yashaswini Swamynathan
Sept 12 (Reuters) - Wall Street was lower on Monday, dragged down by financial companies, as Federal Reserve officials did little to calm investors nervous about an interest rate hike as early as next week.
A number of top Fed officials have hinted at a possible raise at the central bank’s next policy-setting meeting on Sept. 20-21. The latest was Atlanta Fed Bank President Dennis Lockhart who said on Monday a “serious discussion” was warranted.
However, Minneapolis Fed President Neel Kashkari suggested to CNBC that he saw little urgency to take action given the state of the economy.
Six of the 10 major S&P 500 indexes were lower, with financials falling for the third straight day. The biggest Wall Street banks were down between 0.7 and 1.5 percent.
The sector, which would benefit from higher rates, has risen 3.2 percent since Aug. 26, when Fed Chair Janet Yellen said the case for higher rates had strengthened.
Fed Governor and permanent voting member Lael Brainard’s speech, the last scheduled by a Fed member before the meeting, will be scrutinized to see if she maintains her dovish stance on rates or takes a more aggressive posture. Her speech, which was not announced until Friday, is at 1:15 p.m. ET (1715).
While the labor market firms up, inflation has remained frustratingly below the Fed’s 2 percent target. Traders have priced in a 24 percent rate hike in September, and a 59.2 percent chance in December, according to CME Group’s FedWatch tool.
At 9:34 a.m. ET (1334 GMT), the Dow Jones Industrial Average was down 47.84 points, or 0.26 percent, at 18,037.61.
The S&P 500 was down 4.45 points, or 0.21 percent, at 2,123.36.
The Nasdaq Composite was down 10.77 points, or 0.21 percent, at 5,115.14.
The CBOE Volatility index, also called Wall Street’s “fear gauge” rose to 17.63 - its highest level since in the aftermath of the Brexit vote in late June.
The rising expectations of a September rate hike had sent the three major U.S. stock indexes tumbling on Friday in their worst decline since the Brexit vote.
That distanced the benchmark S&P 500 index from its record highs, which it has been clocking since July when expectations of a rate hike this year were muted.
Perrigo rose 4.6 percent after activist investor Starboard Value disclosed a stake and delivered a letter to the drugmaker’s executives. The stock was the top percentage gainer on the S&P.
Declining issues outnumbered advancing ones on the NYSE by 2,188 to 492. On the Nasdaq, 1,610 issues fell and 645 advanced.
The S&P 500 index showed no new 52-week highs and four new lows, while the Nasdaq recorded two new highs and 19 new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Additional reporting by Rodrigo Campos; Editing by Savio D‘Souza)