The Dow and the Nasdaq declined on Monday, weighed by Boeing's disappointing outlook, a pullback in oil prices and worries about General Motors' fate.

But the benchmark S&P 500 <.SPX> held near breakeven, helped by bets that big banks will post reassuring quarterly results.

Boeing was among the Dow's biggest drags after it said late on Thursday that first-quarter profit would be hurt by lower-than-expected airplane prices and production cuts on its lucrative wide-body planes. Boeing tumbled almost 5 percent to $37.25.

But shares of Bank of America jumped 14 percent, while Citigroup soared 17 percent as the banking sector extended a run-up fueled by surprisingly upbeat preliminary results from Wells Fargo late last week.

On Tuesday, Goldman Sachs , up nearly 5 percent, will kick off this week's reports of quarterly results from major banks. The KBW Bank index <.BKX> climbed 6.3 percent, while the S&P financial index <.GSPF> added 3.2 percent.

The market is cheering, not so much that the banks are on the mend, but that they are not going to die, said Les Satlow, portfolio manager of Cabot Money Management in Salem, Massachusetts. These are banks that are clawing their way back, literally from the brink of extinction. My view is that a key crisis phase of this economic downturn is behind us.

The Dow Jones industrial average <.DJI> shed 47.23 points, or 0.58 percent, to 8,036.15. The Standard & Poor's 500 Index <.SPX> dipped 1.04 points, or 0.12 percent, to 855.52. The Nasdaq Composite Index <.IXIC> dropped 8.39 points, or 0.51 percent, to 1,644.15.

The banking sector's health has been a major worry after fallout from the financial crisis led the U.S. government to pump billions of dollars into troubled institutions such as Citigroup, which gave Wall Street a surprise last month when it said it was profitable in January and February.

Citigroup is scheduled to report on Friday.

Earlier, the market had dropped more than 1 percent, weighed in part by a sharp slide in oil prices that hurt energy shares.

But by early afternoon, oil prices had trimmed their slide, with U.S. front-month crude off 1.6 percent at $51.40 a barrel after sliding more than 6 percent.

The prospect of bankruptcy for General Motors was another negative weight after the New York Times reported that the U.S. Treasury Department is directing the struggling automaker to prepare for a bankruptcy filing by June 1 despite the company's contention that it could reorganize outside the court. GM slid 16.7 percent to $1.70.

(Editing by Jan Paschal)