United States stocks closed broadly lower as Wal-Mart Stores weighed on the Dow industrials and buyers remained cautious after strong quarterly gains.
The Dow Jones Industrial Average slipped 61.33 points, or 0.40%, to close at 15,273.26 points, marking its fifth straight loss and the longest losing streak since the six-session stretch ended Aug. 21.
The S&P 500 index shed 4.65 points, or 0.27%, to 1,692.77 points.
The Nasdaq Composite Index also lost 7.16 points, or 0.19%, to 3,761.10 points.
The S&P 500 has slid markedly since its record-high close of 1,725.52 last Wednesday following the Federal Reserve's surprise decision to keep its $85-billion-a-month bond-purchasing program intact.
The index has gained 5.5% in the third quarter, and 19% so far this year. As the end of the quarter approaches, money managers are taking a microscope to their portfolios to prepare for earnings season.
Jason Pride, director of investment strategy at money-management firm Glenmede, expects to see "earnings plodding along."
While he said US stocks could see a modest rise from here, he thinks there are better deals overseas. For example, stock markets of emerging economies are trading at "a reasonable discount," he said.
The Dow industrials extended losses in slow afternoon trading after Bloomberg reported that unsold merchandise was piling up at Dow component Wal-Mart, leading the big-box retailer to cut its orders from suppliers. A Wal-Mart representative later called the report "misleading."
After a sharp initial drop, the stock recovered some of its losses, though it remained the biggest decliner in the Dow. It also weighed on consumer staples sector, which was the biggest decliner in the S&P 500, off 0.6%. Shares were recently trading 1.4% lower.
Tense budget negotiations in Washington also are pressuring stock benchmarks. Senate Democrats said they would support a six-week federal-funding extension, which is a month shorter than the bill passed by the Republican-controlled House. That created another hurdle for Congress to clear to avoid a government shutdown, as funding runs out on Sept. 30.
A greater point of concern for investors is debates over the debt ceiling. The US Treasury Department said Wednesday it had until Oct. 17 before it would exhaust emergency measures to avoid falling behind on obligations.
But since Congress reached last-minute pacts in its previous fiscal negotiations, investors say they expect lawmakers to eventually make a deal.
"They have to have this public show," said Mr. Pride. "But at the last minute, they'll put together what they could have easily agreed on a month and a half ago."
A pair of better-than-expected economic reports helped stem losses in early trading. Durable-goods orders for August edged up 0.1% from July, despite expectations of a 0.6% drop. Sales of new homes rebounded by more than forecast in August, rising 7.9%, while economists expected a 6.6% increase.
The yield on the 10-year Treasury note edged down to 2.631% from 2.650%, where it settled Tuesday.
European markets were broadly lower. The Stoxx Europe 600 closed down 0.1%, as extended weakness in US markets and a surprise drop in French business sentiment offset upbeat news on consumer sentiment in Germany. The French business-sentiment index for September fell to 97 from 98 in August, versus expectations of a rise to 99. Meanwhile, GfK's German consumer-sentiment indicator for October rose slightly more than expected.
Asian markets were mostly lower. Japan's Nikkei Stock Average lost 0.8% in response to a stronger yen. China's Shanghai Composite declined 0.4%.
Crude-oil futures shed 0.3% to $102.80 a barrel, after settling at an eight-week low on Tuesday. Gold futures gained 1.5% to $1,336.60 a troy ounce. The dollar lost ground against the euro and the yen.
In corporate news, Amazon.com edged down 0.3%. On Wednesday, the company announced two new versions of its tablets, the Kindle Fire HDX, with seven-inch and 8.9-inch screens.
J.C. Penney shares slumped 14%, extending a string of losses that has sent the company's stock to its lowest price since late 2000. Goldman Sachs fixed-income analysts said in a note late Tuesday that weakness in the retailer's business could challenge its liquidity levels.