"I think the market needs to get assurance from Corporate America. They want to know that things are getting better," said Quincy Krosby, market strategist at Prudential Financial. "This is still a market that's trying to figure out whether it wants to break higher or lower."
The S&P 500 slipped 0.3 percent, with consumer discretionary and energy leading decliners. The energy sector was pressured by falling oil prices. U.S. crude settled 0.81 percent lower at $49.94 per barrel, weighed by a rising rig count in the United States.
"A pullback unfolded last week, leading to a successful test of initial support near 2115 by the SPX. Short-term momentum has weakened, but oversold conditions are widespread enough to suggest that the pullback will mature this week," Katie Stockton, chief technical strategist at BTIG, said in a Monday note.
The Nasdaq fell a quarter of a percent, as shares of Apple and the iShares Nasdaq Biotechnology ETF (IBB) declined.
Jeremy Klein, chief market strategist at FBN Securities, attributed Monday's soft session for stocks, in part, to the three major indexes failing to hold most of their Friday gains. "People were very disappointed with how we finished Friday and that spilled over into today," he said.
Stocks closed marginally higher, but were on track to post strong gains amid solid quarterly reports from JPMorgan Chase, Citigroup and Wells Fargo before closing near breakeven.
On the earnings front, banking giant Bank of America was among the firms reporting quarterly earnings before the bell, beating expectations on both lines. That said, the SPDR S&P Bank ETF (KBE) fell 0.51 percent. Toymaker Hasbro also posted better-than-expected results, sending its stock more than 8 percent higher, before closing up 7.43 percent.
IBM and Netflix are among the companies scheduled to release results after the close on Monday.
Earnings season has gotten off to a good start. Of the 34 S&P 500 companies that had reported as of Friday morning, 79 percent had beaten Wall Street estimates for earnings per share, according to Nick Raich of The Earnings Scout.
Investors also digested industrial production data, which showed a 0.1 percent increase in September, slightly below a consensus estimate of 0.2 percent. Meanwhile, the New York Fed's Empire State business conditions showed manufacturing in the state contracted for the third straight month.
A slew of economic data is scheduled for release later this week, including CPI, housing starts and the Beige Book.
"I think the most important report this week will be the CPI report. I think it will show inflation further rising here," said David Kelly, chief global strategist at JPMorgan Funds. He added the report would carry added weight after Chair Yellen's speech on Friday.
Overseas, Chinese GDP, retail sales and industrial profits are all scheduled for release on Wednesday. Last week, U.S. stocks were weighed down by a surprise fall in Chinese exports.
"It's pretty clear that China is bumping along the bottom. When we'll see a turnaround, that's unknown," said Maris Ogg, president at Tower Bridge Advisors. But "when you talk to companies that have boots on the ground, ... I think that's gives better color on the data." Ogg pointed specifically to Caterpillar, which is scheduled to report quarterly results next week.
Elsewhere, U.S. Treasury yields slipped but remained close to recent highs, with the two-year note yield around 0.82 percent and the 10-year yield near 1.77 percent.
The U.S. dollar fell slightly against a basket of currencies, with the euro steady around $1.10 and the yen just below 104.