Nov. 15, 2012 at 9:35 AM ET
Stocks fell for a third day on Thursday as Wal-Mart Stores Inc reported disappointing results and investors feared the "fiscal cliff" will harm the economy.
Stocks have struggled recently to hold onto even slight gains, dropping more than 1 percent on Wednesday after starting the session higher.
Investors worry the economy could slip into recession if no deal is reached in Washington to avoid the fiscal cliff - budget cuts and tax hikes that begin to take effect in the new year. The S&P 500 is off about 2 percent for the week so far.
"Presently, investors are grappling with over-arching market issues, such as fears about the looming 'fiscal cliff,' as well as typical seasonal issues such as year-end portfolio repositioning," said Melissa Roberts, lead analyst at quantitative research of Keefe Bruyette & Woods in New York.
"Individual stock performance is now more impacted by overall market performance and broad macro issues rather than company-specific fundamentals."
Investors will closely watch for any clues coming out of Friday's meeting at the White House between President Barack Obama and Republican and Democratic leaders of Congress over deficit reduction.
"In terms of the market, all eyes now are on the congressional meeting tomorrow with the White House," said Peter Boockvar, managing director at Miller Tabak & Co in New York.
"With a very oversold market and bearishness at the individual investor level at the highest since August 2011, a bounce is due if there is any positive commentary in that meeting," he added.
Wal-Mart fell after reporting third-quarter revenue that missed expectations. The world's largest retailer said economic conditions were weighing on customers' spending decisions.
Apple Inc shares also weighed on the market.
But retailer Target Corp rose after it reported a profit that beat expectations.
Reuters contributed to this report.