Major stock indexes were little changed as investors awaited fourth-quarter earnings reports.

The Dow Jones industrial average rose 1.09, or 0.01 percent, to 8785.98. The Nasdaq composite index fell 1.68, or 0.1 percent, to 1446.04, and the Standard & Poor's 500-stock index fell 1.31, or 0.1 percent, to 926.26.

Investors were trading cautiously after the year began with a big rally, fed in part by President Bush's tax-cut proposal. The recent buying was also attributable to portfolio managers who typically begin the year buying stocks to replace shares sold by the end of December.

Analysts said today's lackluster tone wasn't worrisome given the market's recent gains.

In general, analysts say that investors are growing more optimistic about the market's prospects and that they should be. So far this year, the Dow has gained 5.3 percent, while the Nasdaq has climbed 8.3 percent and the S&P has risen 5.3 percent.

Dell Computer fell $1.17, to $25.98, after J.P. Morgan downgraded it to "neutral" from "buy."

Johnson & Johnson fell $1.16, to $56.04, after Thomas Weisel Partners cut its rating on the stock to "attractive" from "buy."

Federated Department Stores declined 44 cents, to $30.58, after the retailer said it expects January same-store sales, those at stores open at least one year, to be down 4 to 5 percent.

But AOL Time Warner rose 15 cents, to $15.03, on news that Chairman Steve Case was stepping down, a move many shareholders believe will lift the company's sagging stock price.

Microsoft advanced 47 cents, to $56.39, ahead of its fiscal second-quarter earnings results due to be released Thursday.

And, Dillard's rose 76 cents, to $17.62, after J.P. Morgan raised its recommendation on the stock to "neutral" from "underweight."

Other Indicators

* The New York Stock Exchange composite index fell 0.59, to 5209.21; the American Stock Exchange index fell 6.90, to 826.54; and the Russell 2000 index of smaller-company stocks fell 0.26, to 396.18.

* Advancing issues outnumbered declining ones narrowly on the NYSE, where trading volume fell to 1.41 billion shares, from 1.48 billion on Friday. On the Nasdaq, decliners narrowly outnumbered advancers and volume totaled 1.56 billion, down from 1.62 billion.

* The price of the Treasury's 10-year note rose $1.56 per $1,000 invested, and its yield fell to 4.12 percent, from 4.14 percent on Friday.

* The dollar fell against the Japanese yen and rose against the euro. In late New York trading, a dollar bought 118.88 yen, down from 119.21 late Friday, and a euro bought $1.0547, down from $1.0572.

* Light, sweet crude oil for February delivery settled at $32.25 a barrel, up 57 cents, on the New York Mercantile Exchange.

* Gold for current delivery rose to $354.70 a troy ounce, from $354.50 on Friday, on the New York Mercantile Exchange's Commodity Exchange.