U.S. stocks on Monday pared earlier gains triggered by Osama bin Laden's death before closing and ended lower, as investors became concerned about possible new terror attacks fueled by the killing of the al-Qaeda leader.

U.S. President Barack Obama declared the death of al-Qaeda leader bin Laden late Sunday night. This news initially lifted the market, as it means a safer world and consumer confidence would rise and more investors would buy into the market.

All three U.S. major indexes opened higher on the morning trading session. But after the knee-jerk reaction faded, concerns about new terror attacks forced stocks down. And the profit-taking on the latter day also contributed to the fall before the closing.

The Dow Jones industrial average fell 3.18 points, or 0.02 percent, to 12,807.36, with energy components slipping most. Exxon Mobil fell 1.15 percent and Chevron fell also 1.15 percent.

The Standard & Poor's 500 was down 2.39 points, or 0.18 percent, to 1,361.22, with energy and material sectors leading the fall. The Nasdaq Composite Index dropped 9.46 points, or 0.33 percent, to 2,864.08.

Despite Monday's fall, many analysts remained bullish of the markets. They thought the gain of U.S. stocks was not over.

To the earnings, Chrysler, managed by Italian car maker Fiat, reported a revenue of 13.1 billion dollars in the first quarter.

The car-maker also reported the first profit of 116 million dollars since emerging from bankruptcy two years ago. Chrysler's share gained.

In the day's economic news, the Institute for Supply Management 's April gauge of manufacturing fell less than expected to 60.4 from 61.2 in March. The construction spending gained 1.4 percent in April to an annual rate of 768.9 billion dollars, according to the Commerce Department, beating the expectations.

In the other markets, U.S. crude initially slipped more than 2 percent after the news that bin Laden was killed, but the prices eventually pared losses and stabilized. London Brent crude for June delivery fell 77 cents to close at 125.12 dollars a barrel, while U.S. crude benchmark fell 41 cents to 113.52 dollars a barrel.

The dollar traded flat against a basket of currencies after initial rise on bin Laden's death, while the price of gold stabilized above 1,556 dollars an ounce, and silver fell nearly 5 percent to almost 46 dollars an ounce.