Wall Street ticks lower, investors seek new catalysts

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NEW YORK (Reuters) - Stocks fell modestly on Monday as investors found few reasons to keep pushing shares higher following a six-weeks-long advance that has taken the S&P 500 index near record highs.


The benchmark index is up more than 6 percent so far this year after a steep rally in January that has stalled as the S&P and Dow industrials near multi-year highs.


"This is still a market that looks terrific, but when you're up for six weeks in a row, everyone is going to want to take a pause going into the seventh week even if there is no bad news out there," said Eric Kuby, chief investment officer at North Star Investment Management in Chicago.


The S&P 500 would need to rise 3.9 percent to reach its all-time intraday high of 1,576.09, which was hit in October 2007.


Google Inc shares fell 1 percent at $777.67 after the company said in a filing former chief executive Eric Schmidt is selling roughly 42 percent of his stake in the Internet search giant, a move that could potentially net him $2.51 billion.


But the decline was offset by gains in Apple , up 1.4 percent at $481.73 after a New York Times report that the iPhone maker is experimenting with the design of a device similar to a wristwatch.


The Federal Reserve's Vice Chair Janet Yellen, seen as a potential successor to Fed Chairman Ben Bernanke next year, said the Fed is still aggressively stimulating an anemic U.S. economic recovery that has failed to bring rapid progress on employment.


The Dow Jones industrial average <.dji> was down 31.05 points, or 0.22 percent, at 13,961.92. The Standard & Poor's 500 Index <.spx> was down 1.80 points, or 0.12 percent, at 1,516.13. The Nasdaq Composite Index <.ixic> was down 5.25 points, or 0.16 percent, at 3,188.62.


Upbeat U.S. and Chinese data last week helped the S&P 500 extend its weekly winning streak to six. The index gained about 8 percent over that period.


Equities have been strong performers lately, rising 6.3 percent so far this year. Many investors have used any declines in the market as opportunities to buy.


"Everyone wants to buy on a dip in this market, but if you're on the sidelines right now, the decline we're seeing today just isn't the kind you would jump in on," Kuby said.


President Barack Obama will describe his plan for spurring the economy in his State of the Union address on Tuesday. He is expected to offer proposals for investment in infrastructure, manufacturing, clean energy and education.


Opposition has grown to the $24.4 billion buyout of Dell Inc , the No. 3 personal computer maker, as three of the largest investors joined Southeastern Asset Management on Friday in raising objections. Dell said in a regulatory filing it had considered many strategic options before opting to go private in a buyout led by Chief Executive Michael Dell.


Dell shares hovered near $13.65, the buyout offer price.


Regeneron Pharmaceuticals Inc shares rose 1.6 percent at $168.72 after it said longtime drug development partner Sanofi plans to boost its stake.


Moody's Corp was one of the strongest percentage gainers on the S&P 500, rising 3.9 percent to $45.06. Last week the stock plunged 22 percent after the U.S. government launched a civil lawsuit against the company. The sell-off marked the stock's worst week since October 2008.


(Editing by Nick Zieminski)



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Militants Battle Malian and French Troops in Liberated Town

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DAKAR, Senegal — Gunfire rang out in the streets of the strategic city of Gao in northern Mali on Sunday, two weeks after French troops appeared to have chased radical Islamists out of the city, which is at the edge of the desert and is the largest population center in the north.




The gun battle between Islamist militants and a force of Malian and French troops, which continued for much of Sunday afternoon, suggested that the quick French campaign against the local Al Qaeda affiliate and its allies was not over but had entered a new phase of guerrilla warfare.


Sunday’s attack by the Islamist fighters was the most serious escalation in the fighting since the French ended over six months of brutal Islamist occupation in Gao at the end of January. That victory came after a quick French bombing campaign and with barely a shot fired.


Continuous bursts of gunfire were heard around the police station, in the city’s center and in southern districts as French helicopters hovered overhead. Malian soldiers fought back against Islamists armed with AK-47 rifles as the streets cleared of residents. French troops were also patrolling the city, which has a population of about 86,000, including its surrounding areas.


By late Sunday afternoon, the Islamist fighters had been encircled by French troops, according to Gao’s municipal councilor, Abdheramane Oumarou, who said the situation was under control.


The attack appeared to have begun with an attempted suicide bombing late Saturday night, when an Islamist militant on foot blew himself up at a Malian Army checkpoint outside of town, in the second such episode in two days. The bomber’s attack, which wounded a Malian soldier, was merely a ruse to allow an Islamist commando unit to enter the city, Mr. Oumarou said.


“The Malian soldiers panicked; that’s how the MUJAO got into town,” Mr. Oumaro said, referring to the Islamist group, the Movement for Oneness and Jihad in West Africa, which is affiliated with Al Qaeda and controlled Gao from May to January. Mr. Oumarou said that the fighters who penetrated Gao were aided by local sympathizers, and that caches of armaments had been discovered by the local authorities.


A Malian Army spokesman said that the bomber was part of a commando team of about 20 Islamist fighters who assaulted a bridge in marshland linking Gao to neighboring villages.


The spokesman, Capt. Daouda Diarra, said the bomber appeared to be of Arab ancestry. He tried to penetrate the army checkpoint, the captain said, setting off his explosives as he did so.


“It’s pretty hot in the town right now,” said the mayor, Sadou H. Diallo, who was reached by phone on Sunday afternoon. “I can’t talk now.”


Though the French appeared to be leading the fight on Sunday, primary responsibility for patrols had been handed back to the Malian Army, still shaky after the defeats of last month that led the French to intervene, and which is still plagued by the internecine squabbles that led to a gun battle at a barracks in the capital, Bamako, on Friday.


Embarrassed by the recent events, Mali’s interim president, Dioncounda Traoré, apologized to the country’s foreign partners in a statement to the state news media. Mali is dependent on large-scale military assistance and other aid from overseas.


The explosion on Saturday night rocked the neighborhood. “We were very scared,” said a resident, Halimatou Touré. “There are lots of mujahedeen who come from this area,” she said. The bomber’s remains were later removed in a wheelbarrow, and French armored vehicles took up positions at the checkpoint.


While Sunday’s clashes showed that the northern cities are still vulnerable to attacks from Islamists, the bulk of their force is thought to have taken refuge in the Adrar des Ifoghas, a remote mountain range near Algeria and hundreds of miles to the north of Gao. Troops from France and Chad, supported by French aircraft, are pursuing the Islamists in this redoubt as well.


Adam Nossiter reported from Dakar, and Peter Tinti from Gao, Mali.



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John Mayer: My Relationship with Katy Perry is 'Very Human'

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By Maggie Coughlan





02/10/2013 at 03:45 PM EST







Katy Perry and John Mayer


Larry Busacca/Getty


Although they've previously dated, this time around might be the real thing for John Mayer and Katy Perry.

"I don't feel like I'm in a celebrity relationship," Mayer, 35, told Anthony Mason during an interview on CBS Sunday Morning of his romance with Perry, 28.

"For the first time in my life I don't feel like I'm in a celebrity relationship. I really don't. I'm not in a high profile – I know it's high profile. It's hard to explain ..." he said.

"For me it feels like something that's very human" he added.

When asked if he sees himself getting married, Mayer responded, "Of course. I mean, I'm still the kid from Connecticut. That's what you do."

The couple have made their affection public, holding hands while Patti Smith performed at Clive Davis and The Record Academy's Annual Pre-Grammy Gala at the Beverly Hilton on Saturday.

Last month, they attended President Obama's inauguration together.

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G20 to skirt potholes and follow growth signposts

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LONDON (Reuters) - With the road ahead looking a bit smoother, G20 finance ministers will be happy to ignore the wreck in the rear-view mirror when they meet this week to steer a course for the world economy.


The euro zone as a whole and a clutch of its members, including France, Italy and the Netherlands, are expected to report that their economies shrank last quarter - joining Germany and the United States - while Japan's barely grew, according to economists polled by Reuters.


But the Group of 20 leading economies, which meets in Moscow on Friday, should be able to take heart from a pair of more timely indicators - a New York Fed manufacturing survey and a University of Michigan poll on consumer sentiment.


Economists expect both to show an improvement, despite the gnawing uncertainty of how long-running U.S. deficit reduction negotiations will affect taxes and spending.


Luca Paolini, chief strategist at Pictet Asset Management in London, said he was more positive on the global outlook on balance but a sense of perspective was needed. Buoyant markets risked getting ahead of themselves.


"Our own leading indicators are going up, but we don't think we're in a strong growth environment. We see weak growth, and that's not going to change this year," he said.


PASSING THE GROWTH BATON


Simon Hayes, an economist with Barclays Capital, broadly agreed. "On the whole, recent activity data have been encouraging of our view that the global economy is improving, albeit slowly," he said in a report.


January U.S. retail sales figures are likely to underline this point. Hobbled by the January 1 increase in payroll taxes, economists expect a rise of just 0.1 percent on the month.


By contrast, U.S. capital spending is finally perking up from a low level as corporations, realizing that protracted cost-cutting is hurting productivity and growth prospects, give the green light to pent-up investments, Paolini said.


"But we're not overly optimistic because investment is based on confidence. You can have all the money you want, but you're not going to invest if you expect growth to be weak. So if we have any kind of shock - it can be politics or something else - investment will fall again," he said.


China delivered a boost to confidence on Friday with a batch of strong trade and money data for January.


Economists are wary of reading too much into China's figures at the start of the year because of distortions due to the variable timing of the long Lunar New Year holidays.


But Ting Lu, Bank of America Merrill Lynch's chief China economist, said they supported his view that gross domestic product growth could accelerate to 8.3 percent in the first half of this year from 7.9 percent in the fourth quarter of 2012.


China is not the only developing economy that is doing its bit for global growth.


Mark Williams, chief Asia economist with Capital Economics in London, said there had been signs of a rebound across the emerging world in the past month. Goldman Sachs, too, said there had been a marked improvement in consumer confidence across emerging markets coming into 2013.


"It had been the case that Latin America and Asia were looking up at the end of last year but emerging economies in Europe were still looking very weak. But even they are now joining in the recovery. So it's looking increasingly broad-based," Williams said.


CURRENCY SKIRMISHES


One obvious pothole on the road to recovery is the threat of a spate of competitive devaluations, as growth-hungry countries seek to give their exporters an edge by talking down their currencies or actively pushing them lower by bold monetary easing.


Japan has come in for fierce criticism in some quarters for that very reason, but Finance Minister Taro Aso sought to restore calm on Friday by saying the recent slide in the yen had gone too far.


His emollient words reinforced expectations that the G20 will not point the finger at Tokyo.


At the same time, European Central Bank President Mario Draghi's success in reversing the euro's climb with a few well-chosen words last Thursday has eased the worries of France and others for now that the single currency was approaching levels that would do real damage to the euro area.


So, although Brazilian Finance Minister Guido Mantega fears global currency wars could intensify, the betting is on an anodyne statement from the Moscow meeting that avoids rattling confidence.


"There will be something very vague reminding everybody that if you start getting into currency wars everybody is going to lose," Paolini with Pictet said.


(Editing by Toby Chopra)



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Russia Detains 271 in St. Petersburg Security Raid

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MOSCOW — Russian police and security officials in St. Petersburg detained 271 people, mostly migrants from Central Asia and the North Caucasus region, during a raid on Friday on Muslim prayer rooms at a central market. They said the raid was carried out to check residency permits and to eliminate networks of religious extremists planning terrorist attacks.




A statement published Friday night by the regional investigative committee said the authorities were verifying the documents of the detainees, who include citizens of Azerbaijan, Tajikistan and Uzbekistan, as well as an Egyptian and an Afghan.


The federal migration service began deportation procedures on Saturday for 10 of the detainees, and about 30 were found to be in violation of Russian migration laws, an official told the news agency RIA Novosti.


The police said one man from southern Russia, Murat Sarbashev, was suspected of distributing extremist literature and video clips showing terrorist acts in 2010 and 2011.


Video broadcast on Russian television showed heavily armed riot police officers pulling men out of the market and pushing them into waiting buses.


Security officials in St. Petersburg say an extremist group is operating in the city and has been planning terrorist attacks. The raid was intended to uncover “extremist literature, weapons, objects and documents relevant to criminal cases, and people who have carried out such crimes,” the statement said. The authorities have opened a case and are searching for evidence pointing to the incitement of terrorism and hatred; a conviction on that charge carries a maximum sentence of seven years in prison.


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Predict the Grammy Award Winners!

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After early start, worst of flu season may be over

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NEW YORK (AP) — The worst of the flu season appears to be over.


The number of states reporting intense or widespread illnesses dropped again last week, and in a few states there was very little flu going around, U.S. health officials said Friday.


The season started earlier than normal, first in the Southeast and then spreading. But now, by some measures, flu activity has been ebbing for at least four weeks in much of the country. Flu and pneumonia deaths also dropped the last two weeks, the Centers for Disease Control and Prevention reported.


"It's likely that the worst of the current flu season is over," CDC spokesman Tom Skinner said.


But flu is hard to predict, he and others stressed, and there have been spikes late in the season in the past.


For now, states like Georgia and New York — where doctor's offices were jammed a few weeks ago — are reporting low flu activity. The hot spots are now the West Coast and the Southwest.


Among the places that have seen a drop: Lehigh Valley Hospital-Cedar Crest in Allentown, Pa., which put up a tent outside its emergency room last month to help deal with the steady stream of patients. There were about 100 patients each day back then. Now it's down to 25 and the hospital may pack up its tent next week, said Terry Burger, director of infection control and prevention for the hospital.


"There's no question that we're seeing a decline," she said.


In early December, CDC officials announced flu season had arrived, a month earlier than usual. They were worried, saying it had been nine years since a winter flu season started like this one. That was 2003-04 — one of the deadliest seasons in the past 35 years, with more than 48,000 deaths.


Like this year, the major flu strain was one that tends to make people sicker, especially the elderly, who are most vulnerable to flu and its complications


But back then, that year's flu vaccine wasn't made to protect against that bug, and fewer people got flu shots. The vaccine is reformulated almost every year, and the CDC has said this year's vaccine is a good match to the types that are circulating. A preliminary CDC study showed it is about 60 percent effective, which is close to the average.


So far, the season has been labeled moderately severe.


Like others, Lehigh Valley's Burger was cautious about making predictions. "I'm not certain we're completely out of the woods," with more wintry weather ahead and people likely to be packed indoors where flu can spread around, she said.


The government does not keep a running tally of flu-related deaths in adults, but has received reports of 59 deaths in children. The most — nine — were in Texas, where flu activity was still high last week. Roughly 100 children die in an average flu season, the CDC says


On average, about 24,000 Americans die each flu season, according to the CDC.


According to the CDC report, the number of states with intense activity is down to 19, from 24 the previous week, and flu is widespread in 38 states, down from 42.


Flu is now minimal in Florida, Kentucky, Maine, Montana, New Hampshire and South Carolina.


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Online:


CDC: http://www.cdc.gov/flu/


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Stocks end higher for sixth straight week, tech leads

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NEW YORK (Reuters) - The Nasdaq composite stock index closed at a 12-year high and the S&P 500 index at a five-year high, boosted by gains in technology shares and stronger overseas trade figures.


The S&P 500 also posted a sixth straight week of gains for the first time since August.


The technology sector led the day's gains, with the S&P 500 technology index <.splrct> up 1.0 percent. Gains in professional network platform LinkedIn Corp and AOL Inc after they reported quarterly results helped the sector.


Shares of LinkedIn jumped 21.3 percent to $150.48 after the social networking site announced strong quarterly profits and gave a bullish forecast for the year.


AOL Inc shares rose 7.4 percent to $33.72 after the online company reported higher quarterly profit, boosted by a 13 percent rise in advertising sales.


Data showed Chinese exports grew more than expected, a positive sign for the global economy. The U.S. trade deficit narrowed in December, suggesting the U.S. economy likely grew in the fourth quarter instead of contracting slightly as originally reported by the U.S. government.


"That may have sent a ray of optimism," said Fred Dickson, chief market strategist at D.A. Davidson & Co in Lake Oswego, Oregon.


Trading volume on Friday was below average for the week as a blizzard swept into the northeastern United States.


The U.S. stock market has posted strong gains since the start of the year, with the S&P 500 up 6.4 percent since December 31. The advance has slowed in recent days, with fourth-quarter earnings winding down and few incentives to continue the rally on the horizon.


"I think we're in the middle of a trading range and I'd put plus or minus 5.0 percent around it. Fundamental factors are best described as neutral," Dickson said.


The Dow Jones industrial average <.dji> ended up 48.92 points, or 0.35 percent, at 13,992.97. The Standard & Poor's 500 Index <.spx> was up 8.54 points, or 0.57 percent, at 1,517.93. The Nasdaq Composite Index <.ixic> was up 28.74 points, or 0.91 percent, at 3,193.87, its highest closing level since November 2000.


For the week, the Dow was down 0.1 percent, the S&P 500 was up 0.3 percent and the Nasdaq up 0.5 percent.


Shares of Dell closed at $13.63, up 0.7 percent, after briefly trading above a buyout offering price of $13.65 during the session.


Dell's largest independent shareholder, Southeastern Asset Management, said it plans to oppose the buyout of the personal computer maker, setting up a battle for founder Michael Dell.


Signs of economic strength overseas buoyed sentiment on Wall Street. Chinese exports grew more than expected in January, while imports climbed 28.8 percent, highlighting robust domestic demand. German data showed a 2012 surplus that was the nation's second highest in more than 60 years, an indication of the underlying strength of Europe's biggest economy.


Separately, U.S. economic data showed the trade deficit shrank in December to $38.5 billion, its narrowest in nearly three years, indicating the economy did much better in the fourth quarter than initially estimated.


Earnings have mostly come in stronger than expected since the start of the reporting period. Fourth-quarter earnings for S&P 500 companies now are estimated up 5.2 percent versus a year ago, according to Thomson Reuters data. That contrasts with a 1.9 percent growth forecast at the start of the earnings season.


Molina Healthcare Inc surged 10.4 percent to $31.88 as the biggest boost to the index after posting fourth-quarter earnings.


The CBOE Volatility index <.vix>, Wall Street's so-called fear gauge, was down 3.6 percent at 13.02. The gauge, a key measure of market expectations of short-term volatility, generally moves inversely to the S&P 500.


"I'm watching the 14 level closely" on the CBOE Volatility index, said Bryan Sapp, senior trading analyst at Schaeffer's Investment Research. "The break below it at the beginning of the year signaled the sharp rally in January, and a rally back above it could be a sign to exercise some caution."


Volume was roughly 5.6 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.


Advancers outpaced decliners on the NYSE by nearly 2 to 1 and on the Nasdaq by almost 5 to 3.


(Additional reporting by Angela Moon; Editing by Bernadette Baum, Nick Zieminski, Kenneth Barry and Andrew Hay)



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The Lede: Social Media Images From Tunisia, as an Opposition Leader Is Buried

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Video of Friday’s funeral for Chokri Belaid, a Tunisian opposition leader assassinated two days ago, from the independent news site Nawaat.

Last Updated, 3:44 p.m. Activists, bloggers and journalists in Tunisia posted a stream of images on social networks Friday, showing thousands of mourners packed into the largest cemetery in the capital, Tunis, for the funeral of Chokri Belaid, a leading opposition figure whose assassination two days ago triggered a wave of street protests against the Islamist ruling party.

Among those uploading images of the funeral — which took place as the police fired tear gas at protesters and cars were set alight during clashes outside the graveyard — were my Times colleagues Kareem Fahim and Tara Todras-Whitehill, Thierry Brésillon of the French news site Rue 89, and Tunisian activists including Selim Kharrat of the rights organization Al Bawsala.

In video streamed live during the funeral by the activist blogger Slim Amamou, the 2011 revolutionary chant calling for the downfall of the regime could be heard echoing around the graveyard.

A photograph in a set uploaded to Facebook by the blogger Mon Massir appeared to show that even the late opposition leader’s young daughter was forced to shield her face from the tear gas fired by the police.

After the funeral, as photographs uploaded by Mr. Amamou and the rights activist Amira Yahyaoui showed, the security forces enforced a ban on gathering on the main Avenue Habib Bourguiba in central Tunis.

Emna Chebâane, who also works with the rights organization Al Bawsala, posted video on Facebook showing how the police moved in to clear a small number of protesters from the avenue.

It was not hard to imagine what the kind of protest the authorities were concerned about might look like. Two days earlier, when an ambulance carrying Mr. Belaid’s body to the morgue had passed through the same street, thousands of protesters swarmed around the vehicle. Video posted on YouTube late Wednesday by Jadal, a Tunisian news site, showed that scene.

Video recorded on Wednesday in Tunis as protesters gathered around an ambulance carrying the body of Chokri Belaid, a murdered opposition leader.

There were reports of protests in other parts of Tunisia on Friday, as many workers observed calls for a nationwide strike.

Video uploaded to YouTube by a blogger who said he was in the town of Sousse appeared to show the security forces, and officers in plain clothes, firing tear gas and dragging protesters away from a traffic circle pictured in a Wikipedia entry on the old town.

Video uploaded to YouTube on Friday, said to show the police cracking down on protesters in the Tunisian town of Sousse.

Two clips posted online earlier Friday by the same blogger appeared to show the divisions in Sousse, between supporters and opponents of the new government, which have emerged nationwide. One clip showed a loud march in favor of Ennahda, the Islamist party that now rules Tunisia; in another, a second group of protesters declared that they were committed to “bringing down the regime and avenging the death of Chokri Belaid.”

Video said to show supporters of Tunisia’s Islamist ruling party, marching in Sousse on Friday.

Video of antigovernment protesters, said to have been recorded in the Tunisian city of Sousse on Friday.

Video shot by bloggers for the independent news site Nawaat showed what they described as a demonstration in the city of Bizerte in honor of Mr. Belaid, outside the local headquarters of Ennahda. According to a description on Nawaat’s French-language live blog, the video shows an Islamist calling for calm and telling the demonstrators that the nation’s secularists have lost the struggle for power.

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Sue Paterno Breaks Her Silence, Defends Late Husband Joe

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By Nicole Weisensee Egan





02/08/2013 at 03:00 PM EST







Sue and Joe Paterno in 2010


Nabil K. Mark/Centre Daily Times/MCT/Getty


Nearly one year after Joe Paterno's death amid scandal, his widow is speaking out.

The football coach – whose heralded 61-year career at PSU ended amid speculation that he did not do enough to prevent former employee Jerry Sandusky from sexually abusing young boys – was "scrupulously honest, rigidly moral and absolutely unafraid of the consequences of doing the right thing," his widow, Sue, says in a letter sent to former Penn State football players Friday.

On Sunday morning, Sue Paterno will release the results of an investigation she ordered into her husband's conduct during the period when Sandusky was bringing his young victims to the university campus, and later when a witness to one of Sandusky's crimes came to the Paternos' home to report some of what he had seen.

She did not give the results of the report in her letter to the players, instead urging them to go to paterno.com on Sunday to read it themselves. The investigation, carried out by experts hired by her lawyers, was a response to a report commissioned by Penn State's board of directors and conducted by former FBI Director Louis Freeh last July. The report alleged that Paterno and other top school officials had shown "shocking disregard for child victims" and tried to cover up the scandal.

"I did not recognize the man Mr. Freeh described," she wrote. "I am here to tell you as definitively and forcefully as I know how that Mr. Freeh could not have been more off base in his assessment of Joe."

"I knew Joe Paterno as well as one human being can know another. Joe was exactly the moral, disciplined and demanding man you knew him to be."

In an exclusive at-home interview with PEOPLE, Sue, 73, goes on to say that "Joe lived his values every day, on and off the field, and he instilled those values in his players. Honesty was paramount."

In October, Sandusky, 69, was sentenced to 30 to 60 years in prison on 45 counts of child sexual abuse.

For Sue Paterno's complete interview, pick up next week's PEOPLE, on newsstands next Friday

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