Wall Street weighed the odds of a June rate hike, and the uncertainty left markets paralyzed for much of Monday's session. 

By the close, the S&P 500 was down 0.21%, the Dow Jones Industrial Average had fallen 0.05%, and the Nasdaq had dropped 0.08%.

That uncertainty over whether the Fed will raise interest rates, with a series of economic reports due before relatively hawkish members gather for a mid-June meeting, led Goldman Sachs to adopt a new model on which to analyze the likelihood of coming changes to monetary policy -- one based on odds. 

"Our views about the speed and timing of that increase are more uncertain, more probabilistic, and more sensitive to new information," analysts wrote in a note. "We intend to manage these probabilities actively in response to new information, including next week's data and [Fed Chair Janet] Yellen's June 6 speech."

Goldman Sachs analysts have kicked off their new coverage with a 35% probability for a hike in June, a 35% probability for July, and a 20% probability for September. 

As the economic data stands, the central bank appears to be ready to make another move on rates following initial liftoff in December. The U.S. economy is "on the verge" of warranting a rate increase next month, Boston Fed President Eric Rosengren said in an interview with the Financial Times over the weekend. 

St. Louis President James Bullard, also a voting member of the bank's monetary policy committee, said economic trends back up the case for slow normalization of rates.

"Labor markets are relatively tight. This may put upward pressure on inflation going forward," Bullard said in a speech in Beijing on Monday. 

The central bank will likely accelerate the pace of rate hikes next year, San Francisco Fed President John Williams said on Monday. The non-voting member said he expects "two or maybe three rate increases" this year and potentially "three or four" over 2017.

Williams also noted that a decision in June will still rely heavily on incoming economic assessments. "We still get another month's data before the June meeting, and we want to analyze that and come to our conclusion," he said.

Wall Street received a wake-up call last week as the likelihood of a rate hike sooner rather than later was made clear in minutes from the Fed's April meeting, which outlined the viewpoints of monetary policy committee members.

The "hawkish tone" of the minutes 'surprised market participants who had become complacent regarding the potential for a summer rate increase," Bill Northey, chief investment officer at the Private Client Group at U.S. Bank, told TheStreet.

Crude oil fell on Monday as Iran stayed firm on increasing its oil exports, adding to a global supply glut. Iran's deputy oil minister, Rokneddin Javadi, said the country didn't intend to halt production and that crude exports would reach 2.2 million barrels per day by the middle of the summer, up from current levels of 2 million barrels. West Texas Intermediate closed at a one-week low, down 0.7% at $48.08 a barrel.

It was a busy day for deals news. German pharmaceuticals and chemicals company Bayer (BAYRY) announced a $62 billion offer to buy U.S.-based crops and seeds specialist Monsanto (MON)  , a 37% premium to Monsanto's close on May 9, the day before Bayer made a written proposal to the company.

In other deals news, Tribune Publishing (TPUB) rejected Gannett's (GCI - Get Report) latest $864 million takeover proposal. Tribune, owner of the Los Angeles Times and Chicago Tribune, did agree to share confidential information with Gannett, a possible path to further negotiations.

Lending Club (LC - Get Report) spiked 8.3% after Singapore-based investment firm Shanda Group acquired an 11.7% stake in the peer-to-peer lender. Lending Club's stock had tumbled this month after the Justice Department began investigating a number of loans sold earlier this year and the company's CEO resigned.

CF Industries (CF - Get Report) climbed after the fertilizer distributor and Dutch rival OCI terminated their proposed $8 billion merger, given the new U.S. tax regulations on so-called inversion deals. CF Industries and OCI had planned to register their combined company in the U.K., significantly reducing their tax rate. CF industries will pay OCI a $150 million breakup fee.