Wall Street set to open lower as presidential debate looms

By Yashaswini Swamynathan

(Reuters) - Wall Street was set to open lower on Monday, with investors gearing up for the first debate between U.S. presidential candidates Hillary Clinton and Donald Trump.

Oil prices rallied in volatile trading as the world's largest producers gathered in Algeria to potentially work out a plan to limit output, though analysts see slim chances of a deal being worked out.

Deutsche Bank's U.S.-listed shares fell nearly 5 percent premarket and dragged on big Wall Street banks after a German magazine cited government sources saying Chancellor Angela Merkel has ruled out state assistance for the lender and any interference in the ongoing U.S. justice department investigation.

While the White House race has so far had little discernible effect on the market, that may soon change as polls show a tightening race.

Clinton's once-comfortable lead in opinion polls has evaporated, and with just over six weeks until Election Day, some investors see a toss-up contest creating volatility in certain sectors, including health insurers, drugmakers and industrials.

A Reuters/Ipsos poll on Monday showed half of the country's likely voters will rely on the debate to make their choice.

"The polls have both candidates neck-to-neck. The debates might increase the lead of one over the other and that's what the market is fearful of," said Peter Cardillo, chief market economist at First Standard Financial in New York.

Dow e-minis were down 88 points, or 0.48 percent at 8:27 a.m. ET, with 21,598 contracts changing hands.

S&P 500 e-minis were down 9 points, or 0.42 percent, with 184,518 contracts traded.

Nasdaq 100 e-minis were down 25 points, or 0.51 percent, on volume of 30,264 contracts.

U.S. shares of Barclays, UBS, Credit Suisse and RBS were down between 1.5 percent and 2.3 percent. Goldman was off 0.8 percent and JPMorgan was lower by 0.54 percent.

Apple was down 0.9 percent after market research firm GfK claimed last week that sales of the new iPhones in Europe were well below the iPhone 6 pace.

Pfizer fell 1.20 percent after the drugmaker abandoned a plan to split into two publicly traded companies.

Chemical company Chemtura soared 17 percent to $33 after Germany's Lanxess offered to buy the company for $2.69 billion, including debt.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Saumyadeb Chakrabarty)