Score another for the bears - the market growling in the longest losing streak this year.

Selling was not heavy though with investors unwilling to bet big as Washington deliberates.

The U.S. Treasury warning lawmakers that the government will run out of cash by October 17th, but investors are holding out hope Congress will reach a deal to avoid a government shutdown and raise the debt limit, despite one lawmaker's marathon attempt to slow down the process.

Slow down that's one way to describe the U.S. economy. New home sales rose 7.9 percent in August but that was still near the lowest sales figure of the year. The median home price dropped below $255,000.

The housing recovery has not stopped, says economist Nouriel Roubini.


"I think that there will be a gradual recovery of housing, both in prices and quantities, both supply and demand, given that we're well below trend levels for the last five years. However, the gradual rise in long-term interest rates is going to guide the recovery of housing. It's not going to be as strong as some of the optimists were making it."

In other data, orders for large ticket items known as durable goods barely moved the needle in August.

Want to drive a Tesla electric car without buying it? Hertz says it will start renting the Model S at two California airports. Hertz already lends out the Tesla Roadster.

Wal-Mart is responding to slower consumer traffic by cutting orders, according to Bloomberg News, but a later report on CNBC disputed that speculation. Nevertheless, worries about what that could say about the health of the consumer put a dent in already fragile investor sentiment. Wal-Mart was the weakest Dow component, ending the day down by more than a full percent.

Amazon unveils Kindle Fire HDX. The tablet comes in two sizes and is chock full of tweaks aimed at selling more movies, music, and books for the leading internet retailer. The most talked about feature is a live 24-hour video helpdesk, which Amazon hopes will win over consumers.

European stocks settled for the day - slightly mixed.