NYMEX-Oil slips after recent rally; supported by supply fears

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U.S. crude slipped 58 cents to $107.98 a barrel by 0030 GMT, after settling 1.7 percent below, the lowest since Jan. 20. Brent fell $1.30 to settle at $124.17 a barrel.

FUNDAMENTALS

* The struggling U.S. housing market is a "significant drag" on the overall economic recovery, Federal Reserve Governor Elizabeth Duke told Congress in testimony obtained by Reuters on Monday.

* German Chancellor Angela Merkel scraped through a parliamentary vote endorsing a second bailout for Greece on Monday but faced a growing backbench revolt against pouring in more money in support of the euro zone.

* Standard & Poor's on Monday cut Greece's long-term ratings to 'selective default', the second ratings agency to proceed with a widely expected downgrade after the country announced a bond swap plan to lighten its debt burden.

* Syrian artillery pounded rebel-held areas of Homs as President Bashar al-Assad's government announced that voters had overwhelmingly approved a new constitution in a referendum derided as a sham by his critics at home and abroad.

* Iran is still relying on decades-old technology to expand its nuclear programme, a fact that suggests it might be having difficulties developing more modern machines that could speed production of potential bomb material, experts say.

MARKETS NEWS

* The benchmark S&P 500 closed at its highest level since mid-2008 on Monday, extending gains for a third session as oil prices retreated after a recent rally and data showed further improvement in the U.S. housing market.

* The euro nursed modest losses in Asia on Tuesday, while the yen held on to overnight gains ahead of another flood of cheap cash from the European Central Bank that could bolster risk appetite and put the yen under pressure again.

* Japan's Nikkei share average edged down on Tuesday after market participants took profits ahead of a key selling level at 9,700, while chipmaker Elpida Memory Inc was untraded with a glut of sell orders after seeking bankruptcy protection.

DATA/EVENTS

* The following data is expected on Tuesday:

- 1000 EZ Business climate Feb

- 1000 EZ Economic sentiment Feb

- 1400 U.S. CaseShiller 20 mm nsa Dec

- 1400 U.S. CaseShiller 20 yy Dec

- 1500 U.S. Consumer confidence Feb

- 2130 U.S. API petroleum stocks Weekly

(Reporting by Manash Goswami;Editing by Clarence Fernandez)

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