U.S. stocks were little changed on Monday as investors were cautious before the head of the Federal Reserve was due to discuss interest rate policy this week after the Fed's hike in the discount rate.
The Standard & Poor's 500 index was weighed down by energy shares, while investors pushed bank stocks higher.
Fed Chairman Ben Bernanke is scheduled to testify before House and Senate committees on Wednesday and Thursday about monetary policy. Last week the Fed announced a surprise increase in the rate it charges banks for emergency loans.
The market is still processing a lot of the news on the rate increase. It does seems like there's a little concern, said Dennis Cajigas, senior market strategist at Lind-Waldock, a retail brokerage firm in Chicago.
People are still trying to figure out what the intentions of Bernanke are moving forward.
The Dow Jones industrial average <.DJI> shed 14.58 points, or 0.14 percent, to 10,387.77. The Standard & Poor's 500 Index <.SPX> slipped 1.34 points, or 0.12 percent, to 1,107.83. The Nasdaq Composite Index <.IXIC> edged 3.90 points lower, or 0.17 percent, to 2,239.97.
Shares of oilfield services company Schlumberger Ltd
Schlumberger shares tumbled 4.6 percent to $60.96 and led declines on the S&P energy index <.GSPE>, which fell 1.2 percent. Smith International rose 7.8 percent to $40.63.
Health insurers' shares rose after President Barack Obama proposed a revised overhaul of U.S. healthcare. The Morgan Stanley healthcare payor index <.HMO> rose 1.5 percent.
The lack of a public plan in the president's proposal was a relief for (healthcare) investors, said John Sullivan, healthcare investment strategist at Leerink Swann in Boston.
Banks shares rose as the increase in the discount rate was seen as a vote of confidence in the financial system and worries about tougher rules for banks eased.
Part of this may be the fact that Obama has taken his eyes off financial institutions (reform) and has started to focus on healthcare again, said Tom Schrader, managing director of U.S. equity trading at Stifel Nicolaus Capital Markets in Baltimore.
Wells Fargo & Co
Shares of Millipore Corp
(Editing by Kenneth Barry)