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Stocks End Lower in Light Trading, Dragged by Energy; Banks Gain

Stocks finished slightly lower in lackluster trading Monday as investors remained cautious amid a lack of new market catalysts following the recent rally that helped the S&P 500 end its sixth-consecutive week higher.

(Read More: After-Hours Buzz: FB, LGF, BNNY & More)

"We've been 500 days without a 10 percent correction and we've got 57 percent bullishness—that gets a little scary on the contrary basis," said Art Cashin, director of floor operations at UBS Financial Services. "And it's also the year of the snake, which is the least bullish of the 12 Asian zodiac characters and it's seen some spotty events—9/11, the attack on Pearl Harbor, and the crash of 1929."

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The Dow Jones Industrial Average slid 21.73 points, to close at 13,971.24, led by UnitedHealth and Home Depot. Last week, the blue-chip index failed to regain its footing above the widely-watched 14,000 level and closed lower for the week, snapping five-weeks of consecutive gains. The blue-chip index traded in a narrow 52-point range.

With the Dow's recent rally having stalled around 14,000, analysts are mulling whether markets are consolidating for the next push higher, or poised for a correction.

(Read more: Dow May Struggle to Outdo Itself as Caution Takes Hold)

The S&P 500 slipped 0.92 points, to finish at 1,517.01. The Nasdaq erased 1.87 points, to end at 3,192.00. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, finished below 13.

Among key S&P sectors, energy ended lower, while financials climbed.

"We're due for some sort of pullback, but the Fed's still pushing $85 billion of new liquidity into the market every month and despite the State of the Union and some of the other bumps we've got coming–political uncertainty is much lower than it was six weeks ago," said Michael Jones, CIO of Riverfront Investment Group.

(Read More: Stocks Better Investment Than Homes: Shiller)

President Barack Obama is scheduled to deliver his annual State of the Union address to Congress on Tuesday.

Tesla traded lower following a review report from the New York Times claiming the car's battery drained much quicker than promised in cold weather. Meanwhile, Tesla's CEO Elon Musk said the article on Tesla's range in cold weather is "fake," adding that the reviewer's vehicle logs show that he "didn't actually charge [the battery] to max and took a long detour."

Regeneron Pharmaceuticals soared after the biotechnology company said Sanofi intends to buy Regeneron's common stock.

Google declined after executive chairman Eric Schmidt said he is is selling about 42 percent of his stake in the company, or about 3.2 million shares over a one-year period.

Meanwhile, the Nasdaq's decline was partly offset by gains in Apple, after a report that the iPhone maker is testing a wristwatch-like device, according to the New York Times.

Cisco edged higher after Mizuho raised its target price on the tech bellwether to $25 from $23. The networking-equipment company is scheduled to post quarterly earnings on Wednesday.

Nike rallied after JPMorgan raised its rating on the sports-apparel retailer to "overweight" from "neutral" and boosted its target price to $64 from $50.

US Airways and AMR are within a week to announcing an $11 billion merger that would create the world's largest airline, according to a Reuters report, citing sources familiar with the matter.

Among earnings, Boardwalk Pipeline Partners reported that its fourth quarter earnings surged by 26 percent, helping to underpin market sentiment ahead of the open. The oil and gas company saw revenues rise across all its components, beating estimates.

European shares finished in the red, continuing the previous week's pullback from multi-month peaks, ahead of a meeting of euro zone finance ministers in Brussels to discuss issues which may include Greece, Cyprus, direct bank recapitalizations and competitive currency devaluations.

In Asia, bourses in China, Hong Kong, Singapore, Taiwan and South Korea were shut for the Lunar New Year holiday. Japan was also closed for its National Founding holiday.

(Read More: China Ushers in Frugal Year of the Snake)

—By CNBC's JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

Coming Up This Week:

TUESDAY: NFIB small business optimism index, Fed's George speaks, 3-yr note auction, Treasury budget, Fed's Plosser speaks, State of the Union; Earnings from Barclay's, Coca-Cola, Avon Products, McGraw-Hill, Michael Kors, Buffalo Wild Wings, Clearwire
WEDNESDAY: Weekly mortgage applications, retail sales, import & export prices, business inventories, oil inventories, Fed's Bullard speaks, 10-yr note auction; Earnings from Comcast, Deere, Dean Foods, Cisco, Applied Materials, MetLife
THURSDAY: Jobless claims, natural gas inventories, Fed's Bullard speaks, 30-yr bond auction, Fed balance sheet/money supply, 13-F filings; Earnings from General Motors, PepsiCo, Rio Tinto, CBS
FRIDAY: Empire state mfg survey, Treasury int'l capital, industrial production, Fed's Pianalto speaks, consumer sentiment, e-commerce retail sales, credit card default rates reported; Earnings from Campbell

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