The stock market rallied from a morning loss to inch into positive territory by the closing, a pattern often seen in recent sessions.

The S&P 500 Index closed up 0.52 points, or 0.05 percent, at 1,150.51 as it continues to test its 2010 high. The Dow Jones Industrial Average closed up 17.46 points, or 0.16 percent, at 10,642.15.

The Nasdaq Composite closed down 0.23 percent as shares of Google (NASDAQ:GOOG) and Apple (NASDAQ:AAPL) struggled.

European finance ministers met on Monday in Brussels to discuss plans to support Greece, although they revealed no concrete details.

Nevertheless, investors in the bond market were calmed by this development as Greece bonds generally rose on Monday.

Shares of big U.S. banks declined before the announcement of Senator Chris Dodd's financial reform bill, with most trading down at least 1 percent.

After the details were made known, however, fear eased as bank shares rallied.

Dodd's proposal includes the creation of a fund that will assist the government in winding down big financial firms that are collapsing.

The bill also recommended future actions to implement the Volcker Rule, which restricts banks from proprietary trading operations.

The document stated that Volcker Rule regulations will be developed after a study by the Financial Stability Oversight Council and based on their recommendations.

The Democratic Senator unveiled his bill without any backing from Republican Senators. The provision to create a consumer protection agency in the bill is likely to drawn stiff resistance

In the afternoon session, Banks such as Goldman Sachs (NYSE:GS), JPMorgan (NYSE:JPM), and Morgan Stanley (NYSE:MS) pared much of their earlier declines to close at slight losses.

Early in the trading session, commodities and the U.S stock market also declined on fears of aggressive monetary tightening by China. However, these fears eased in the afternoon session as the stock market and futures on commodities rallied.