The S&P 500 closed very slightly lower on Monday as investors took a breather after three weekly gains while they awaited key inflation readings and earnings reports due this week while a survey showed consumers concerned about inflation.

A Federal Reserve Bank of New York survey, released on Monday, found that Americans see inflation at 3.3% a year from now from March’s 3% while they expect inflation three years from now at 2.8%. This followed a University of Michigan report on Friday that showed U.S. consumer sentiment sagged to a six-month low in May as households worried about the cost of living.

Last week the Nasdaq composite and the S&P 500 both registered their third straight weeks of gains, boosted by strong earnings reports and signs of a cooling labor market that fueled bets of one or two Federal Reserve rate cuts this year.

But on Monday investors appeared anxious to stay clear of making big bets ahead of April Consumer Price Index (CPI) data due out on Wednesday. They will also preparing to monitor producer price index data, retail sales data, weekly jobless claims and earnings reports from big retailers Home Depot and Walmart, all due out this week.

"Investors are like somebody looking out the window trying to see what the weather's like before deciding what to wear. Today and tomorrow are going to be all about Wednesday's consumer inflation report," said Burns McKinney, portfolio manager at NFJ Investment Group in Dallas.

"In the last three months that's been the single biggest mover. Each of these times inflation's come in a little bit stickier than investors had expected. Each time that's happened investors have ratcheted back expectations for interest rate cuts."

The Dow Jones Industrial Average fell 81.33 points, or 0.21%, to 39,431.51, the S&P 500 lost 1.26 points, or 0.02%, to 5,221.42 and the Nasdaq Composite gained 47.37 points, or 0.29%, to 16,388.24.

Anthony Saglimbene, Ameriprise chief market strategist, said the "marked deterioration in consumer sentiment and rising expectations around inflation" from the consumer sentiment surveys puts even more weight on the upcoming inflation data.

"Stocks are just kind of stuck in this really tight trading range until we get some more information on inflation trends," said Saglimbene.

Core consumer prices are expected to have risen 0.3% on a month-over-month basis in April and 3.6% on an annual basis according to economist forecasts in a Reuters poll ahead of Wednesday's release.

Fed Vice Chair Phillip Jefferson said earlier on Monday that he supports keeping interest rates steady until it is clear that price pressures are moderating.

Among the S&P 500's 11 major industry sectors only two gained ground on Monday.

Technology provided the biggest boost and

Apple was its biggest index point contributor.

Investors in the sector were focused on artificial intelligence technology with Apple shares closing up 1.8% after a report that it had closed in on an agreement with ChatGPT-maker OpenAI to use the startup's technology on the iPhone.

OpenAI, which is backed by Microsoft, said it would release a new AI model capable of realistic voice conversation and able to interact across text and image.

Alphabet, expected to show off its own new AI-related features at its developers' conference on Tuesday, managed to close up 0.3% after falling as much as 2.7% during the session.

Shares of videogame retailer GameStop jumped soared 74% after "Roaring Kitty", a former marketer at an insurance firm credited with sparking the 2021 meme stock rally, returned to after a three-year hiatus.

Other highly shorted names involved in the 2021 meme rally also rose. AMC Entertainment jumped 78% and Koss Corp closed up 36.7%.

On U.S. exchanges 10.09 billion shares changed hands compared with the 10.79 billion moving average for the last 20 sessions.

Advancing issues outnumbered decliners by a 1.23-to-1 ratio on the NYSE where there were 311 new highs and 40 new lows.

On the Nasdaq, advancing issues outnumbered decliners by a 1.14-to-1 ratio. The S&P 500 posted 34 new 52-week highs and no new lows while the Nasdaq recorded 145 new highs and 91 new lows. (Reporting by Sinéad Carew in New York, Sruthi Shankar and Shristi Achar A in Bengaluru; Editing by Devika Syamnath, Shinjini Ganguli and David Gregorio)