A $3 drop in oil prices and several better-than-expected economic reports failed to keep the stock market out of negative territory on Monday as Wall Street now shifts its attention to the Federal Reserve's impending interest rate decision. 

Today's Market

The Dow Jones Industrial Average fell 42.17 points, or 0.37% to 11284.15, the Standard & Poor’s 500 index dropped 11.30 points, or 0.90%, to 1249.01 and the Nasdaq Composite Index lost 25.40 points, or 1.10%, to 2285.56. The consumer-friendly FOX 50 slid 3.39 points, or 0.38%, to 886.43.

While the diving crude oil prices weren't enough for a positive finish on Wall Street they did help lift the blue chips out of an early triple-digit hole. 

The action follows one of the most turbulent weeks of the year for the stock market, including four moves of triple-digits in either direction on the Dow. Traders continue to debate whether or not the worst of the bad news is over or more problems in the economy and financial sector will emerge.

“Last week was a rollercoaster week… We’ll probably see a lot of that this week too," Alan Valdes of Hilliard Lyons told FOX Business. 

Drug giant Pfizer (PFE) led the blue-chip advancers on Monday, rising about 2%. On the other hand, aluminum titan Alcoa (AA) and energy giant ExxonMobil (XOM) posted the index's worst percentage losses, sliding 4% a piece. 

The Nasdaq Composite slumped by more than 1% Monday and never made it into positive territory. Vertex Pharmaceuticals (VRTX) saw some of the largest percentage declines on the Nasdaq 100, sliding 8.5% on its weaker-than-expected quarterly results. Also, DISH (DISH) declined by 4% following its second-quarter earnings. 

Crude oil prices fell by as much as $5 and briefly slid below $120 a barrel Monday morning, sparking a rally in the stock market and erasing gains of almost $2. By the end of the day oil prices ended $3.69 lower at $121.41 a barrel -- the lowest level in three months. The decline comes as Tropical Storm Edouard has failed to strengthen, helping to ease worries of major oil production halts. It also follows a downward trend fueled by worries of lower gasoline demand amid record prices. 

Airline stocks benefited from the oil price dive, jumping almost 5% as a group. American Airlines (AMR) and Continental (CAL) jumped by nearly 10% a piece on the news. On the downside, energy stocks took heavy losses, diving almost 5% as a sector. Shares of Hess (HES) fell 7% while Range Resources (RRC) plunged 13%. 

Financial stocks closed mostly lower but they had been down further earlier in the day following another bank failure over the weekend. The Federal Deposit Insurance Corp. announced the closure of First Priority Bank, a small Florida-based bank with $259 million in assets and $227 million in deposits. First Priority’s six branches will reopen on Monday as SunTrust Bank after SunTrust (STI) agreed to assume the insured deposits of the failed bank.

Now Wall Street can zero in on the conclusion of the Federal Reserve's policy meeting on Tuesday. Inflation hawks have called on the central bank to begin reversing its string of interest rate reductions that began nearly a year ago, however some believe a rate hike will hurt the fragile economy. 

“The Fed is basically impotent," Peter Boockvar, equity strategist at Miller Tabak told FOX Business. "This crisis is not going to end because of what the Fed does. It will end on its own. It's an economic cycle that has to run its course.”

Traders are currently betting that the Fed will hold rates steady as it did at its last meeting. 

"I don’t think they will do anything with interest rates because, at least in my opinion, they are stuck between a rock and a hard place. They are damned if they do and damned if they don’t," Ted Weisberg of Seaport Securities told FOX Business. 

Wall Street had a relatively muted response to the day's economic reports, which were mostly better-than-expected. 

The Commerce Department said consumer spending jumped by 0.6% in June thanks to the government's economic stimulus checks. Economists had expected a more modest 0.5% increase in spending, according to Dow Jones consensus estimates. However, excluding price increases, spending declined by 0.2%, the worst reading since February. Consumer spending accounts for more than two-third's of the nation's economy.

The government also reported a 0.1% rise in personal income during June, compared to the 0.3% decline that economists had been looking for. However, it was the smallest increase in personal income since April 2007. The PCE Index, a key gauge of inflation, rose by 0.3% excluding volatile food and energy prices, matching consensus estimates.

Factory orders grew by 1.7% in June, compared to average estimates for just 0.6% of growth. Excluding transportation, factory orders increased by 2.3%, more than the 1.7% expected. 

Corporate Movers

ImClone Systems (IMCL) said it feels Bristol-Myers Squibb’s (BMY) $4.5 billion buyout offer “substantially undervalues” the company. The biotech company said it has formed a committee and retained advisors to study the matter. Billionaire activist investor Carl Icahn told ImClone’s board that he opposed the Bristol-Myers bid. ImClone also said it has been discussing the possibility of separating the company’s ERBITUX and pipelines businesses to “maximize the value of the company.”

General Electric (GE) has no plans to sell its NBC Universal business, an executive told Reuters. "I think [CEO]Jeff Immelt has been very clear ... saying to the media, to internal audiences and to investors that he sees NBC as a part of GE's future," Beth Comstock, GE's chief marketing officer, told the news agency. GE owns an 80% stake in NBC, which begins airing the Olympics in Beijing later this week.

Time Warner (TWX) has completed internal steps and is now getting serious about selling its AOL business, possibly to Microsoft (MSFT) or Yahoo! (YHOO), The Wall Street Journal reported. Ahead of a sale, the media giant first had to separate AOL's dial-up access unit from its advertising and content business, the newspaper reported. While Time Warner continues to have informal talks with both Microsoft and Yahoo, no deal has surfaced as of yet, the Journal reported. 

HSBC (HBC), the largest U.K. bank by market cap, posted in-line results on Monday. The company's first-half profit slid 29% to $7.72 billion, matching analyst estimates. HSBC closed 2% lower on the NYSE. 

Humana (HUM) posted a 3% decline in second-quarter earnings to $1.24 per share, topping average estimates of $1.18 from Thomson Reuters. The health insurer also upgraded its earnings projection for the full year.

Motorola (MOT) saw its shares rise 11.5% after the company named Sanjay Jha co-chief executive officer and CEO of mobile devices. Jha had previously served as chief operating officer of Qualcomm (QCOM). Motorola also named Greg Brown to the co-CEO post as well as CEO of mobility solutions. The company said both Brown and Jha will "share responsibility for Motorola" as it moves towards becoming two separate, publicly-traded companies. 

Wyeth (WYE) said it has received subpoenas from the U. S. Attorney’s Office in Massachusetts tied to its promotion and pricing of Protonix. The pharmaceutical company said has been responsive and continues to cooperate with the investigation into Protonix, which is used to treat erosive esophagitis.

JetBlue (JBLU) began charging for pillows and blankets on Monday as the airline and its peers continue to add surcharges as they deal with near-record fuel costs. The company said it will charge $7 for a pillow and blanket kit for flights longer than two hours. JetBlue’s stock closed higher amid a broad airline rally based on the oil price decline. 

Orbitz Worldwide (OWW) closed sharply lower as the online travel site said it won’t post its quarterly earnings after the closing bell as had been previously scheduled. Instead, Orbitz said it expects its financial statements will be finalized and released on Thursday.

Deere (DE) slid 7% after the tractor company was reportedly downgraded to "neutral" from "buy" at Goldman Sachs. According to Thomson Reuters, the investment bank also removed the company from its Americas Buy list, saying peers Parker-Hannifin (PF), Eaton (ETN), Bucyrus (BUCY) and AGCO (AG) have better risk to reward profiles.

World Markets

The Dow Jones Euro Stoxx 50 Index, a gauge of the 50 biggest companies in Europe, fell 27.35 points, or 0.82%, to 3289.26. The FTSE 100, London's benchmark index, slid 34.50 points, or 0.64%, to 5320.20.

On the continent, Paris' CAC 40 lost 33.71 points, or 0.78%, to 4280.63, while Germany's DAX dropped 46.65 points, or 0.73%, to 6349.81.

In Asia, Hong Kong's Hang Seng slid 347.68 points, or 1.52%, to 22514.92 while Japan's Nikkei 225 dropped 161.41 points, or 1.23%, to 12933.18.