New York: US stocks dropped as recent economic data speculated the Federal Reserve will begin raising interest rates from September.

The Dow Jones Industrial Average dipped 114.98 points (0.69 percent) to 16,528.03 on Monday, reported a news agency.

The S&P 500 lost 16.69 points (0.84 percent) to 1,972.18. The Nasdaq Composite Index shed 51.82 points (1.07 percent) to 4,776.51.

Investors were still sifting through the strong gross domestic product (GDP) report released on Thursday.

The US Commerce Department revised up its estimate for the country’s GDP growth in the second quarter to 3.7 percent, which is much higher than the 0.6 percent growth in the first quarter.

A separate report from the department showed that US personal income in July increased 0.4 percent and personal consumption expenditures increased 0.3 percent after an upwardly revised 0.3 percent rise in June.

Federal Vice Chairman Stanley Fischer on Friday said it was too early to determine whether last week’s market turmoil would impact the likelihood of a rate hike next month.

On Saturday, he said US inflation was likely to rebound, which allows for a gradual increase in rates.

Meanwhile, the Chicago Business Barometer held on to most of July’s gain, falling to 54.4 in August from 54.7 in July, according to the ISM-Chicago Business Survey on Monday.

Oil prices surged for the third straight session on Monday, with the US oil jumping nearly nine percent, which bolstered the energy sector and buttressed the stock market for further decline.

The West Texas Intermediate for October delivery moved up $3.98 to settle at $49.2 a barrel on the New York Mercantile Exchange, while Brent crude for October delivery increased $4.1 to close at $54.15 a barrel on the London ICE Future Exchange.

Lifted by the spiking oil prices, the energy sector rose 1.05 percent on Monday as the only advancer among the S&P 500’s ten sectors.

Chinese shares saw a weak performance on Monday, as the government intensifies efforts to crack down on market manipulation.

For the month, all three major indices suffered big losses, with the Dow, the S&P 500 and the Nasdaq plunging 6.6 percent, 6.3 percent and 6.9 percent, respectively.

The CBOE Volatility Index, often referred to as Wall Street’s fear gauge, rose 9.14 percent to end at 28.43 on Monday.

In other markets, the US dollar traded mixed against other major currencies on Monday after rising for four consecutive sessions.

In late New York trading, the euro rose to $1.1220 from $1.1179 in the previous session, while the dollar bought 121.20 Japanese yen, lower than 121.33 yen of the previous session.

Gold futures fell on the COMEX division of the New York Mercantile Exchange on Monday as the US Federal Reserve hinted that the US interest rate could be increased before the end of the year.

The most active gold contract for December delivery lost $1.5 (0.13 percent) to settle at $1,132.50 per ounce.