Stocks finished almost flat on Monday as investors took a break from a recent rally, awaiting earnings from bellwethers such as Apple later in the week.
The S&P 500 is up nearly 5 percent so far this year as an improving U.S. economy has bolstered investor optimism. The Dow and the S&P 500 both had their best weekly performances in a month last week.
"Investors are reserved after a mixed bag of results. Many companies have announced sluggish results, portraying a cautious environment going forward," said Robert Lutts, chief investment officer at Cabot Money Management in Salem, Massachusetts.
"The expectations are very moderate in the market, so a little bit of good news could lead to a significant pop in a stock."
According to Thomson Reuters data, 15 percent of S&P 500 companies have reported earnings, and just 59 percent posted results above Wall Street's expectations. That percentage trails the average of about 70 percent, though the rate is expected to improve as the earnings season gathers steam.
Among the 117 S&P 500 companies expected to report earnings this week is tech company Apple Inc , due after the closing bell on Tuesday.
The euro-zone crisis remained in the background for the market but has had less of an effect on stocks lately. Germany and France pushed for a deal between Greece and its private creditors, and the two said they still were dedicated to a new bailout that Athens needs by March to stave off default.
The Dow Jones industrial average <.DJI> slipped 11.66 points, or 0.09 percent, to end at 12,708.82. But the Standard & Poor's 500 Index <.SPX> inched up 0.62 point, or 0.05 percent, to close at 1,316.00. And the Nasdaq Composite Index <.IXIC> dipped 2.53 points, or 0.09 percent, to end at 2,784.17.
TEXAS INSTRUMENTS UP LATE
After the bell, Texas Instruments Inc shares rose 2.5 percent to $34.00 after reporting higher-than-expected fourth-quarter revenue.
In addition to Apple, a number of Dow components are due to report earnings on Tuesday, notably Verizon Communications Inc , Travelers Companies Inc , McDonald's Corp , DuPont and Johnson & Johnson .
Wall Street's agenda includes the Federal Reserve's first policymaking meeting of the year, which will begin on Tuesday and conclude on Wednesday with a statement. The Fed is likely to say that it will not start raising interest rates again until the first half of 2014, more than five years after cutting them to near zero, a Reuters poll of leading Wall Street economists showed.
The U.S. central bank will begin a new practice of announcing policymakers' interest-rate projections when this week's meeting ends on Wednesday.
During Monday's regular session, Halliburton Co shares fell 2.1 percent to $35.44 after the world's second-largest oilfield services group warned that the deep slump in U.S. natural gas prices could cause near-term disruptions that pinch first-quarter earnings.
On a positive note, Chesapeake Energy Corp gained 6.3 percent to $22.28 after it said it will reduce dry gas drilling and cut production in response to natural gas prices falling below "economically attractive" levels. Natural gas companies' shares were among the day's best performers, with an index of those stocks <.XNG> rising 3.6 percent.
Research In Motion Ltd fell 8.5 percent to $15.56 as analysts were skeptical about the resignation of the BlackBerry maker's co-chief executives.
Sears Holding Corp fell 3.3 percent to $47.39 after rising as high as $54.76 in what analysts said could be a short squeeze.
The stock is the most shorted stock in the S&P 500, according to Data Explorers, with 94 percent of shares available used to sell short. The retailer has been the best-performing stock in the index for the year, up more than 50 percent.
"That is a classic short squeeze. There have been headlines all over the name now for the better part of a month or so, and it's largely been quite negative," said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.
Trading volume was at about 6.6 billion shares on the New York Stock Exchange, NYSE Amex and Nasdaq, in line with the daily average of 6.68 billion.
Advancers outnumbered decliners on the NYSE by a ratio of about 3 to 2. In contrast, on the Nasdaq, about six stocks fell for every five that rose.