Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.

Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.

Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.

"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.

Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.

But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.

National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.

"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

OPTIONS BULLS TARGET GAINS

The spending cuts, if they go ahead, could hit the defense industry particularly hard.

Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.

Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.

"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.

The stock ended up 0.6 percent at $88.12 on Friday.

If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.

General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.

EYES ON GDP DATA, APPLE

The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.

U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.

Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.

Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.

On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.

(Additional reporting by Doris Frankel; Editing by Kenneth Barry)

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Oscar Pistorius gets bail as murder trial looms

PRETORIA, South Africa (AP) — Oscar Pistorius walked out of court Friday — free at least for now — after a South African magistrate released him on bail, capping four days of often startling testimony that foreshadowed a dramatic trial in the Valentine's Day slaying of his girlfriend.

But as he was driven away, chased by photographers and cameramen, questions continued to hound the double-amputee Olympian about what actually happened the night he gunned down Reeva Steenkamp inside a locked bathroom in his home.

Pistorius is charged with premeditated murder, and even Chief Magistrate Desmond Nair expressed doubts about his story that he mistook the 29-year-old model for an intruder and fired out of fear.

"Why would (Pistorius) venture further into danger" by going into the bathroom at all, Nair asked.

Cries of "Yes!" went up from Pistorius' supporters when Nair announced his decision to a packed courtroom after a nearly two-hour explanation of the ruling.

Nair set bail at 1 million rand ($113,000), with $11,300 in cash up front and proof that the rest is available. The 26-year-old track star was also ordered to hand over his passports, turn in any guns he owns and keep away from his upscale home in a gated community in Pretoria, which is now a crime scene.

He cannot leave the district of Pretoria without his probation officer's permission and is not allowed to consume drugs or alcohol, the magistrate said. His next court appearance was set for June 4.

Earlier, Pistorius alternately wept and appeared solemn and composed, especially as Nair criticized police procedures in the case and as a judgment in the track star's favor appeared imminent. He showed no reaction as he was granted bail.

Pistorius left the courthouse in a silver Land Rover just over an hour after the bail conditions were set. The vehicle, tailed by motorcycles carrying television cameramen, later pulled into the home of Pistorius' uncle.

"We are relieved at the fact that Oscar got bail today, but at the same time we are in mourning for the death of Reeva, with her family," said Pistorius' uncle, Arnold Pistorius. "As a family, we know Oscar's version of what happened on that tragic night and we know that that is the truth and that will prevail in the coming court case."

Dozens of journalists and international and local television crews had converged on the red-brick courthouse to hear the decision — a sign of the global fascination with a case involving a once-inspirational athlete and his beautiful girlfriend, a law school graduate and budding reality TV show contestant.

Nair said Pistorius' sworn statement, an unusual written account of what happened during the pre-dawn hours of Feb. 14, had helped his application for bail.

"I come to the conclusion that the accused has made a case to be released on bail," Nair said.

Pistorius said he shot Steenkamp accidentally, believing she was an intruder in his house. He described "a sense of terror rushing over" him and feeling vulnerable because he stood only on his stumps before opening fire.

Prosecutors say he intended to kill Steenkamp as she cowered in fear behind the locked bathroom door after a loud argument between the two.

Yet despite poking holes in Pistorius' version of events and bringing up incidents they say highlight his temper, the state's case started to unravel during testimony by the lead investigator, Detective Warrant Officer Hilton Botha.

Botha, who faces seven charges of attempted murder in an unrelated incident, was removed from the case Thursday. His replacement, the nation's top detective, Vinesh Moonoo, stopped by the hearing briefly Friday.

While Nair leveled harsh criticism at Botha for "errors" and "blunders," he said one man does not represent an investigation and that the state could not be expected to put all "the pieces of the puzzle" together in such a short time.

The prosecution accepted the judge's decision without protest. "We're still confident in our case," prosecution spokesman Medupe Simasiku said.

Pistorius faced the sternest bail requirements in South Africa because of the seriousness of the charge, which carries a life sentence if convicted. His defense attorneys had to prove that he would not flee the country, would not interfere with witnesses or the case, and his release would not cause public unrest.

Nair questioned whether Pistorius would be a flight risk when he stood to lose a fortune in cash, cars, property and other assets. Nair also said that while it had been shown that Pistorius had aggressive tendencies, he did not have a prior record of offenses for violent acts.

Anticipating the shape of the state's case at trial, he said he had serious questions about Pistorius' account: Why didn't he try to locate his girlfriend if he feared an intruder was in the house? Why didn't he try to determine who was in the bathroom before opening fire? And why did he venture into perceived "danger" in the bathroom when he could have taken other steps to ensure his safety?

"There are improbabilities which need to be explored," Nair said, adding that Pistorius could clarify these matters by testifying under oath at trial.

Sharon Steenkamp, Reeva's cousin, said the model's family would not be watching the bail decision and had not been following the hearing.

"It doesn't make any difference to the fact that we are without Reeva," she told The Associated Press.

Before the hearing, Pistorius' longtime coach, Ampie Louw, said he hoped to put the runner back into his training routine if he got bail.

"The sooner he can start working the better," said Louw, who persuaded the double-amputee to take up track as a teenager a decade ago. But he acknowledged Pistorius could be "heartbroken" and unwilling to immediately pull on the carbon-fiber running blades that earned him the nickname "Blade Runner."

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AP Sports Writer Gerald Imray contributed to this report from Johannesburg.

___

Jon Gambrell can be reached at www.twitter.com/jongambrellAP .

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Analysis: Italian election explained

Austerity-hit Italy chooses new leader

Austerity-hit Italy chooses new leader

Austerity-hit Italy chooses new leader

Austerity-hit Italy chooses new leader

STORY HIGHLIGHTS

• Silvio Berlusconi is campaigning to win his old job back for the fourth time


• The eurozone's third largest economy is hurting, with unemployment surpassing 11%


• Pier Luigi Bersani of the center-left Democratic Party is expected to narrowly win


• Italy's political system encourages the forming of alliances

(CNN) -- Little more than a year after he resigned in disgrace as prime minister, Silvio Berlusconi is campaigning to win his old job back -- for the fourth time.

Berlusconi, the septuagenarian playboy billionaire nicknamed "Il Cavaliere," has been trailing in polls behind his center-left rival, Per Luigi Bersani.

But the controversial media tycoon's rise in the polls in recent weeks, combined with widespread public disillusionment and the quirks of Italy's complex electoral system, means that nothing about the race is a foregone conclusion.

Why have the elections been called now?

Italian parliamentarians are elected for five-year terms, with the current one due to end in April. However in December, Berlusconi's People of Freedom Party (PdL) withdrew its support from the reformist government led by Mario Monti, saying it was pursuing policies that "were too German-centric." Monti subsequently resigned and the parliament was dissolved.

Berlusconi -- the country's longest serving post-war leader -- had resigned the prime ministerial office himself amidst a parliamentary revolt in November 2011. He left at a time of personal and national crisis, as Italy grappled with sovereign debt problems and Berlusconi faced criminal charges of tax fraud, for which he was subsequently convicted. He remains free pending an appeal. He was also embroiled in a scandal involving a young nightclub dancer - which led him to be charged with paying for sex with an underage prostitute.

MORE: From Venice to bunga bunga: Italy in coma

He was replaced by Monti, a respected economist and former European Commissioner, who was invited by Italy's President Giorgio Napolitano to lead a cabinet of unelected technocrats. Monti's government implemented a program of tax rises and austerity measures in an attempt to resolve Italy's economic crisis.

Who are the candidates?

The election is a four-horse race between political coalitions led by Bersani, Berlusconi, Monti, and the anti-establishment movement led by ex-comedian Beppe Grillo. Polls are banned within two weeks of election day, but the most recent ones had Bersani holding onto a slender lead over Berlusconi, followed by Grillo in distant third.

READ MORE: Will Monte Paschi banking scandal throw open Italy's election race?

The center-left alliance is dominated by the Democratic Party, led by Bersani. He is a former Minister of Economic Development in Romano Prodi's government from 2006-8 -- and has held a comfortable lead in polls, but that appears to be gradually being eroded by Berlusconi.

Italy's political system encourages the forming of alliances, and the Democratic Party has teamed with the more left-wing Left Ecology Freedom party.

The 61-year-old Bersani comes across as "bluff and homespun, and that's part of his appeal -- or not, depending on your point of view," said political analyst James Walston, department chair of international relations at the American University of Rome.

He described Bersani, a former communist, as a "revised apparatchik," saying the reform-minded socialist was paradoxically "far more of a free marketeer than even people on the right."

Bersani has vowed to continue with Monti's austerity measures and reforms, albeit with some adjustments, if he wins.

At second place in the polls is the center-right alliance led by Berlusconi's PdL, in coalition with the right-wing, anti-immigration Northern League.

Berlusconi has given conflicting signals as to whether he is running for the premiership, indicating that he would seek the job if his coalition won, but contradicting that on other occasions.

In a recent speech, he proposed himself as Economy and Industry Minister, and the PdL Secretary Angelino Alfano as prime minister.

Roberto Maroni, leader of the Northern League, has said the possibility of Berlusconi becoming prime minister is explicitly ruled out by the electoral pact between the parties, but the former premier has repeatedly said he plays to win, and observers believe he is unlikely to pass up the chance to lead the country again if the opportunity presents itself.

Berlusconi has been campaigning as a Milan court weighs his appeal against a tax fraud conviction, for which he was sentenced to four years in jail last year. The verdict will be delivered after the elections; however, under the Italian legal system, he is entitled to a further appeal in a higher court. Because the case dates to July 2006, the statute of limitations will expire this year, meaning there is a good chance none of the defendants will serve any prison time.

He is also facing charges in the prostitution case (and that he tried to pull strings to get her out of jail when she was accused of theft) -- and in a third case stands accused of revealing confidential court information relating to an investigation into a bank scandal in 2005.

Despite all this, he retains strong political support from his base.

"Italy is a very forgiving society, it's partly to do with Roman Catholicism," said Walston. "There's sort of a 'live and let live' idea."

Monti, the country's 69-year-old technocrat prime minister, who had never been a politician before he was appointed to lead the government, has entered the fray to lead a centrist coalition committed to continuing his reforms. The alliance includes Monti's Civic Choice for Monti, the Christian Democrats and a smaller centre-right party, Future and Freedom for Italy.

As a "senator for life," Monti is guaranteed a seat in the senate and does not need to run for election himself, but he is hitting the hustings on behalf of his party.

In a climate of widespread public disillusionment with politics, comedian and blogger Beppe Grillo is also making gains by capturing the protest vote with his Five Star Movement. Grillo has railed against big business and the corruption of Italy's political establishment, and holds broadly euro-skeptical and pro-environmental positions.

How will the election be conducted?

Italy has a bicameral legislature and a voting system which even many Italians say they find confusing.

Voters will be electing 315 members of the Senate, and 630 members of the Chamber of Deputies. Both houses hold the same powers, although the Senate is referred to as the upper house.

Under the country's closed-list proportional representation system, each party submits ranked lists of its candidates, and is awarded seats according to the proportion of votes won -- provided it passes a minimum threshold of support.

Seats in the Chamber of Deputies are on a national basis, while seats in the senate are allocated on a regional one.

The party with the most votes are awarded a premium of bonus seats to give them a working majority.

The prime minister needs the support of both houses to govern.

Who is likely to be the next prime minister?

On current polling, Bersani's bloc looks the likely victor in the Chamber of Deputies. But even if he maintains his lead in polls, he could fall short of winning the Senate, because of the rules distributing seats in that house on a regional basis.

Crucial to victory in the Senate is winning the region of Lombardy, the industrial powerhouse of the north of Italy which generates a fifth of the country's wealth and is a traditional support base for Berlusconi. Often compared to the U.S. state of Ohio for the "kingmaker" role it plays in elections, Lombardy has more Senate seats than any other region.

If no bloc succeeds in controlling both houses, the horse-trading begins in search of a broader coalition.

Walston said that a coalition government between the blocs led by Bersani and Monti seemed "almost inevitable," barring something "peculiar" happening in the final stages of the election campaign.

Berlusconi, he predicted, would "get enough votes to cause trouble."

What are the main issues?

There's only really one issue on the agenda at this election.

The eurozone's third largest economy is hurting, with unemployment surpassing 11% -- and hitting 37% for young people.

Voters are weighing the question of whether to continue taking Monti's bitter medicine of higher taxation and austerity measures, while a contentious property tax is also proving a subject of vexed debate.

Walston said the dilemma facing Italians was deciding between "who's going to look after the country better, or who's going to look after my pocket better."

He said it appeared voters held far greater confidence in the ability of Monti and Bersani to fix the economy, while those swayed by appeals to their own finances may be more likely to support Berlusconi.

But he said it appeared that few undecided voters had any faith in Berlusconi's ability to follow through on his pledges, including a recent promise to reverse the property tax.

What are the ramifications of the election for Europe and the wider world?

Improving the fortunes of the world's eighth largest economy is in the interests of Europe, and in turn the global economy.

Italy's woes have alarmed foreign investors. However, financial commentator Nicholas Spiro, managing director of consultancy Spiro Sovereign Strategy, says the European Central Bank's bond-buying program has gone a long way to mitigating investors' concerns about the instability of Italian politics.

Why is political instability so endemic to Italy?

Italy has had more than 60 governments since World War II -- in large part as a by-product of a system designed to prevent the rise of another dictator.

Parties can be formed and make their way on to the political main stage with relative ease -- as witnessed by the rise of Grillo's Five Star Movement, the protest party which was formed in 2009 but in local and regional elections has even outshone Berlusoni's party at times.

Others point to enduringly strong regional identities as part of the recipe for the country's political fluidity.

READ MORE: Italian Elections 2013: Fame di sapere (hunger for knowledge)

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Drew Peterson: 'I don't do well in incarceration'

With a 38-year sentence at age 59, Drew Peterson most likely will spend the rest of his life in prison.

The former Bolingbrook police officer acknowledged as much in a tearful, rage-filled monologue before his sentencing Thursday. Barring a successful appeal, Peterson will not be eligible for release until he's 93. But he estimated he would not make it that long because he has developed high cholesterol and has been twice diagnosed with skin cancer since his incarceration at the Will County Jail.

"I'm not looking for any sympathy, but anything you sentence me to, you're sentencing me to the Department of Corrections to die," Peterson told the court in a raised voice choked with emotion.

Peterson's new life will stand in stark contrast to the one he knew as a police sergeant, when he busied himself by riding motorcycles, flying airplanes and chasing younger women. But it won't be that different from the nearly four years he has spent in jail after being charged with killing his third wife, Kathleen Savio.

Peterson was transferred to the Stateville Correctional Center on Friday morning, less than 24 hours after receiving his sentence. He stayed there only a few hours before being sent to his new home at the Pontiac prison. He is in the maximum-security facility, which has a protective custody unit. The assignment was based on factors such as his conviction, length of sentence, program needs, and medical and mental health requirements, per Illinois Department of Correction protocol.

Officials have not said whether he has a cellmate or if he will be in solitary confinement as he had been during his jail stay.

As part of his daily routine there, he will remain in his cell for most of the day, though he will be allowed out for meals and showers. Most inmates also get about five hours of recreation time outside per week, Illinois Department of Corrections spokeswoman Stacey Solano said.

Peterson already seemed to be envisioning a dreary existence.

"I don't do well in incarceration," he said during his 40-minute courtroom soliloquy. "Due to the bad food and lack of exercise (in jail), I have high blood pressure, high cholesterol, borderline diabetes, a variety of skin issues, and I've had two bouts with skin cancer."

Prisoners can earn work privileges and be assigned menial jobs in the kitchen, laundry room or other areas of the detention center. The shifts, which are not daily, are at least four hours long, Solano said.

Though the Will County Jail has a similar jobs program, Peterson did not participate in it because he was kept separate from the rest of the jail population. The sheriff's department, which oversees the facility, kept him segregated there amid concerns that his high-profile case and law-enforcement background could make him a target of inmates looking to build tough-guy reputations.

As such, Peterson had been kept in the jail's medical unit since his May 2009 arrest. He spent most of his time in his cell, which was 8 feet wide by 5 feet deep. He was given an hour or two in an adjacent day room each day, but that's about it.

His attorney Joseph Lopez, however, said he does not believe such measures need to be taken in state prison. Though high-profile inmates often attract unwanted attention — Jeffrey Dahmer, for example, was slain in 1994 while serving multiple life terms — Lopez thinks Peterson can protect himself.

"He's got a black belt in karate. He knows how to defend himself," Lopez said. "He's a gregarious type of guy. I'm sure the inmates will love him once they get to know him."

Peterson did not seem as convinced on Thursday.

"Originally, I had some cute and funny things to end with," he said, "but in closing now it's time to sentence an innocent man to a life of hardship and abuse (in) prison, and I don't deserve this."

Illinois Department of Corrections officials would not say what safety precautions would be taken in their facilities, but Solano said such issues are considered during an inmate's initial evaluation.

"IDOC will continue to ensure proper placement of all offenders as the health, safety and security of inmates and staff remain the department's top priority," she said.

Peterson will be allowed visits in prison, with some facilities allowing up to five per month. He had similar privileges in jail, but few people had actually come to see him. A visitor's list released shortly before his murder trial included his brother, sister and a small number of friends. Only two of his six children — his sons Thomas and Kris with Savio — went to see him in jail.

His older son, Stephen, who is raising his father's two youngest children, had not visited in the three years leading up to the trial. However, the two communicate frequently via collect phone calls from the jail. Illinois prisoners also have regular telephone contact — as long as it's collect — with people on their approved contacts list, Solano said.

Peterson's attorneys informed him after court Thursday that he could be transferred to Stateville as early as Friday. Despite his rage-filled monologue in court, he seemed to take the prison transfer in stride.

"He's ready for it," Lopez said. "He says he wants a change of scenery."

And that's just fine with Savio's family.

"I think he should have gotten 60 (years) myself," her brother Henry Savio Jr. said. "But he is going to spend the rest of his life in jail so I'm OK with it. He deserves to die there."

sstclair@tribune.com

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Abe vows to revive Japanese economy, sees no escalation with China

WASHINGTON (Reuters) - Japanese Prime Minister Shinzo Abe told Americans on Friday "I am back and so is Japan" and vowed to get the world's third biggest economy growing again and to do more to bolster security and the rule of law in an Asia roiled by territorial disputes.

Abe had firm words for China in a policy speech to a top Washington think-tank, but also tempered his remarks by saying he had no desire to escalate a row over islets in the East China Sea that Tokyo controls and Beijing claims.

"No nation should make any miscalculation about firmness of our resolve. No one should ever doubt the robustness of the Japan-U.S. alliance," he told the Center for Strategic and International Studies.

"At the same time, I have absolutely no intention to climb up the escalation ladder," Abe said in a speech in English.

After meeting U.S. President Barack Obama on his first trip to Washington since taking office in December in a rare comeback to Japan's top job, he said he told Obama that Tokyo would handle the islands issue "in a calm manner."

"We will continue to do so and we have always done so," he said through a translator, while sitting next to Obama in the White House Oval Office.

Tension surged in 2012, raising fears of an unintended military incident near the islands, known as the Senkaku in Japan and the Diaoyu in China. Washington says the islets fall under a U.S.-Japan security pact, but it is eager to avoid a clash in the region.

Abe said he and Obama "agreed that we have to work together to maintain the freedom of the seas and also that we would have to create a region which is governed based not on force but based on an international law."

Abe, whose troubled first term ended after just one year when he abruptly quit in 2007, has vowed to revive Japan's economy with a mix of hyper-easy monetary policy, big spending, and structural reform. The hawkish leader is also boosting Japan's defense spending for the first time in 11 years.

"Japan is not, and will never be, a tier-two country," Abe said in his speech. "So today ... I make a pledge. I will bring back a strong Japan, strong enough to do even more good for the betterment of the world."

'ABENOMICS' TO BOOST TRADE

The Japanese leader stressed that his "Abenomics" recipe would be good for the United States, China and other trading partners.

"Soon, Japan will export more, but it will import more as well," Abe said in the speech. "The U.S. will be the first to benefit, followed by China, India, Indonesia and so on."

Abe said Obama welcomed his economic policy, while Deputy Chief Cabinet Secretary Katsunobu Kato said the two leaders did not discuss currencies, in a sign that the U.S. does not oppose "Abenomics" despite concern that Japan is weakening its currency to export its way out of recession.

The United States and Japan agreed language during Abe's visit that could set the stage for Tokyo to join negotiations soon on a U.S.-led regional free trade agreement known as the Trans-Pacific Partnership.

In a carefully worded statement following the meeting between Obama and Abe, the two countries reaffirmed that "all goods would be subject to negotiations if Japan joins the talks with the United States and 10 other countries.

At the same time, the statement envisions a possible outcome where the United States could maintain tariffs on Japanese automobiles and Japan could still protect its rice sector.

"Recognizing that both countries have bilateral trade sensitivities, such as certain agricultural products for Japan and certain manufactured products for the United States, the two governments confirm that, as the final outcome will be determined during the negotiations, it is not required to make a prior commitment to unilaterally eliminate all tariffs upon joining the TPP negotiations," the statement said.

Abe repeated that Japan would not provide any aid for North Korea unless it abandoned its nuclear and missile programs and released Japanese citizens abducted decades ago to help train spies.

Pyongyang admitted in 2002 that its agents had kidnapped 13 Japanese in the 1970s and 1980s. Five have been sent home, but Japan wants better information about eight who Pyongyang says are dead and others Tokyo believes were also kidnapped.

Abe also said he hoped to have a meeting with new Chinese leader Xi Jinping, who takes over as president next month, and would dispatch Finance Minister Taro Aso to attend the inauguration of incoming South Korean President Park Geun-hye next week.

(Additional reporting by Jeff Mason and Doug Palmer; Editing by David Brunnstrom and Paul Simao)

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Stock index futures signal a rebound

LONDON (Reuters) - Stock index futures pointed to a higher open on Wall Street on Friday, rebounding after the S&P 500 <.spx> posted its worst two-day loss since November.

Futures for the S&P 500, the Dow Jones and the Nasdaq 100 were up 0.2-0.3 percent at 0958 GMT.

European shares rose and German Bund futures fell on Friday after a better-than-expected German Ifo survey.

Shares in Hewlett-Packard rose 2.9 percent in after-market trade as the computer maker's quarterly revenue and forecasts beat Wall Street expectations.

Chipmaker Texas Instruments Inc raised its quarterly dividend by a third and said it will buy back an additional $5 billion in stock. TI shares rose 2 percent in after-market trading after closing at $32.48 on the Nasdaq.

Fellow chipmaker Marvell Technology Group Ltd forecast results this quarter largely above analysts' expectations as it gained market share in hard-disk drive and flash storage businesses, sending its shares up 5 percent after the closing bell.

Insurer American International Group Inc reported fourth-quarter results that beat Wall Street expectations, helping its shares rise 4.2 percent in after hours trade.

Citigroup Inc said on Thursday it has overhauled an executive pay plan that shareholders rejected last year as overly generous, revising it to tie bonus payments more closely to stock performance and profitability.

Newmont Mining Corp , the No. 1 U.S. gold producer, said on Thursday that a more disciplined approach to spending and cost cuts is its top priority as leadership of the company shifts to Gary Goldberg, who takes over as chief executive on March 1.

Private equity firm KKR & Co LP has submitted an offer of $75 per share for Gardner Denver Inc GDI.N, valuing the industrial machinery maker at close to $3.7 billion, two people familiar with the matter said on Thursday.

Interpublic Group, the second-biggest U.S. advertising and marketing group, is expected to follow larger rival Omnicom in reporting upbeat quarterly results, with earnings per shares seen up $0.03 year on year to $0.53 on higher revenue from the United States.

The Dow Jones industrial average <.dji> fell 46.92 points, or 0.34 percent, to 13,880.62 on Thursday. The Standard & Poor's 500 Index <.spx> lost 9.53 points, or 0.63 percent, to 1,502.42. The Nasdaq Composite Index <.ixic> dropped 32.92 points, or 1.04 percent, to close at 3,131.49.

(Reporting By Francesco Canepa/editing by Chris Pizzey, London MPG Desk, +44 (0)207 542-4441)

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Obama a marker on post-racial path

Donna Brazile says Black History Month is a time to note crossroads the nation has faced.

STORY HIGHLIGHTS

• Donna Brazile: Black History Month themed crossroads, "tied to two pivotal U.S. events


• Emancipation Proclamation, March on Washington were crossroads, she says


• She says crossroad decisions are threaded along U.S. road to post-racial society


• Brazile: We're not there yet, but re-election of Obama a harbinger

Editor's note: Donna Brazile, a CNN contributor and a Democratic strategist, is vice chairwoman for voter registration and participation at the Democratic National Committee. She is a nationally syndicated columnist, an adjunct professor at Georgetown University and author of "Cooking with Grease." She was manager for the Gore-Lieberman presidential campaign in 2000.

(CNN) -- Politicians and historians love to use the word "crossroads."

It's become as American, and cliched, as "Mom's apple pie." The historian Shelby Foote, wrote, "The Civil War defined us as what we are and it opened us to being what we became, good and bad things. ... It was the crossroads of our being, and it was a hell of a crossroads."

I have been thinking about the word, because this year's Black History Month theme is "At the Crossroads of Freedom and Equality: The Emancipation Proclamation and the March on Washington." Two pivotal events that shaped modern American history.

A "crossroads" is literally the intersection of two or more roads -- two or more paths to get to the same place. Metaphorically, it refers to the place -- the moment -- of a critical decision. Shall we go forward together? Shall we separate? Shall we fight?

Donna Brazile

We mark history's crossroads not by road signs but by the documents that identify them. The Declaration of Independence is certainly one. Who has not memorized the opening of the second paragraph? "We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the Pursuit of Happiness."

Political philosopher John Locke's original term was, "Life, liberty, and property." Thomas Jefferson borrowed the phrase, changing "property" to "the pursuit of happiness." He understood that "happiness" -- being significant -- was more important than property, and that a "right to property" too often meant a "right" to own someone else, i.e. slavery.

Locke rejected the "divine right of kings." He argued instead that God invested each person with an innate equality -- the right to be on this Earth and to be free -- free to pursue dreams. On the way to his first inauguration, Abraham Lincoln stopped at Independence Hall in Philadelphia to celebrate Washington's birthday. He told the assembled crowd, "I have never had a feeling politically that did not spring from the sentiments embodied in the Declaration of Independence."

Lincoln's issuance of the Emancipation Proclamation in 1863 was another crossroads, one that required Lincoln, and the nation, to walk a long road of personal and national growth. "All men are created equal" had to take on a deeper meaning. Frederick Douglass, one of Lincoln's "guides" on his journey, later said the quality he most admired in Lincoln was his political courage.

Confederate President Jefferson Davis once acknowledged to an Atlantic Monthly writer that Lincoln's Emancipation resulted in the self-liberation of "two millions of our slaves."

A journey of a hundred years brought us to another crossroads -- the 1963 March on Washington. While "property in man" no longer existed, millions of Americans were unable to pursue their dream, or to live with full equality.

James Farmer, a leading civil rights activist who was in jail in my home state of Louisiana, sent a message to the quarter-million in attendance that summer day, saying his people would not be free "until the dogs stop biting us in the South and the rats stop biting us in the North."

Martin Luther King, Jr.'s "I Have a Dream" speech, like the Declaration, resonates. It echoes through the years in the heartbeats of Americans. The "pursuit of happiness" is more than pleasure, for we often take great pains in the pursuit. Rather, the pursuit of happiness is the freedom to pursue our dreams, to make meaning in and find the unique significance of our lives.

That is something we can only do when, in the bonds of fellowship and shared history, we nurture our dreams. The caged bird sings of freedom, but the freed bird sings of dreams. Today, we are 150 years further down the road to realizing the American creed of equality and freedom. We reached a crossroads in 2008 with the election of our first African-American president. We chose to continue on the road to a "post-racial" society.

We're not there yet. But in 2012, when we could have chosen to travel down another road, one that led to further economic inequality, we chose instead to continue the realization of equality and freedom, and to the unfettered pursuit of dreams for each American.

In some ways, the re-election of President Obama is more significant than his election four years ago. I say this not because I'm a Democrat, but because this time, the dog-whistles of racism were called out and condemned by people of faith and goodwill on both sides of the aisle.

During the next four years, we'll come to more crossroads. I pray, and believe, we will take the road to freedom and equality for each child, man and woman in America.

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The opinions expressed in this commentary are solely those of Donna Brazile.

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Snow turning to drizzle during morning commute - ice expected

CAPTIONS

Tears
A tear drops from the eye of DePaul University student Sam Henning as she is hit by a stiff breeze on West Wacker Drive. Tears protest eyes from drying out in cold, windy weather. (John J. Kim, Chicago Tribune /February 19, 2013)

Staff report

4:48 a.m. CST, February 22, 2013

About three inches of snow fell across the Chicago region, though the snow is expected to turn to freezing drizzle this morning, coating the area with ice.

The accumulation was more or less consistent across the area, from Rockford in north central Illinois east to Portage, Ind.

The weather caused between 20 and 30 spinouts on highways across the city and suburbs, according to state police, who described the conditions as "horrible." 

State Police are in a "snow plan" and aren't responding to accidents without injuries - those are supposed to be reported later.

"It will be tapering off from the south in the next couple hours, possibly some freezing drizzle across whole area," said Mark Ratzer, meteorologist for the National Weather Service. "We may end up coming in a little less."

The city of Chicago has sent 284 plows to work clearing main thoroughfares, according to the streets and sanitation department.

Temperatures today should peak around 34 degrees with winds gusting out of the east around 20 or 25 miles an hour.

"The wind should be diminishing today to around 10 miles an hour," said Ben Deubelbeiss, meteorologist for the National Weather Service.

Flurries could linger into the weekend with a chance for light snow on Saturday. Deubelbeiss said he didn't expect any significant weather Sunday. High temperatures both days should be around 30, with lows in the low 20s and high teens both mornings.

Check back for more information.

chicagobreaking@tribune.com

Twitter: @ChicagoBreaking

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Shares, euro extend losses as Europe recovery hopes dim

LONDON (Reuters) - European shares and the single currency fell sharply on Thursday when surprisingly weak euro zone economic data dashed hopes of an early recovery for the recession-hit region this year.

Economists had forecast the euro zone purchasing managers' indexes (PMIs), based on surveys of business activity, would add to tentative signs a recovery was under way, but instead they pointed to a first-quarter contraction of up to 0.3 percent.

"The expectation was the trend of improvement for the euro zone as a whole would continue and it hasn't, so that is a disappointment," said BNP Paribas economist Ken Wattret.

The euro tumbled to a fresh six-week low below $1.32 on the news, having already suffered at the hands of a resurgent greenback following signals from the U.S. Federal Reserve on Wednesday that it was considering an end to monetary stimulus.

Signs that Fed policymakers were becoming increasingly reluctant to continue aggressive monetary easing, revealed in the minutes of the last policy meeting, had sparked a worldwide selloff in riskier asset markets.

MSCI's world equity index <.miwd00000pus>, already down 0.5 percent on the doubts about future Fed policy, took another step down after the PMI data to be one percent lower for the day, having touched its best levels since mid-2008 on Wednesday.

Europe's Eurofirst 300 index <.fteu3> shed 1.25 percent, on track for its second biggest daily loss of the year. London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> were all down as much as 1.8 percent lower.

SAFETY PLAYS WELL

In the fixed income market, German bonds, considered a safe haven, hit their best levels for a month with the main Bund futures contract up 91 ticks to 143.33. The move reversed a fall seen on Wednesday and was also being supported by the approach of an Italian general election this weekend.

"Investors are becoming more and more cautious ahead of the weekend ... and altogether people decided here to pull the trigger and go risk-off," said Christian Lenk, a strategist at DZ Bank.

The dollar, another safety play, followed up its big gains on Wednesday adding a further 0.45 percent on an index value that includes most major currencies <.dxy>, although it slipped against the yen to 93.35.

The Markit composite PMI for the euro zone, which combines both services and manufacturing surveys, fell to 47.3 in February from 48.6. It had been expected to rise to 49.0.

The data also showed a growing gap between Germany and France - the two biggest economies in the euro zone - which could have implications for the European Central Bank's future monetary policy.

The survey found firms in Germany are enjoying a healthy rate of growth, while French service sector companies are in the midst of their worst slump since the financial crisis was at a peak in early 2009.

"The theme is still the very substantial divergence between France and Germany and that is going continue to be the case for much of the year," said Wattret of BNP Paribas.

"On the margins this is going to resonate with the dovish tone from the ECB at its last meeting, but I think the real swing factor for the ECB will be exchange rate factor and the tightening impact it is having."

The strength of the euro has been holding back exports.

In commodity markets, the prospect of weakening demand from Europe and a possible early end to the Fed's policy of quantitative easing sent all markets lower.

London copper struck its lowest in nearly two months, at $7,870 a tonne, while oil dropped below $114.50 a barrel for the first time this month having seen its biggest daily fall of the year on Wednesday.

Growth-attuned precious metal platinum fell 3 percent to hit a five-week low. Traditional safe haven gold popped higher, to $1,568 an ounce, after the Fed minutes had pushed it to a seven-month low.

"Long-position holders have been looking to sell for profit-taking," said Yusuke Seta, a commodity sales manager at Newedge Japan. "I guess this is a good time to sell."

(Additional reporting by Marc Jones.; Editing by Alastair Macdonald)

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Prosecutors: Detective should be dropped from case

PRETORIA, South Africa (AP) — South Africa's National Prosecuting Authority acknowledged that the timing of attempted murder charges against a police detective leading the investigation into Oscar Pistorius is "totally weird" and that he should dropped from the case against the world-famous athlete.

Bulewa Makeke, spokeswoman for the NPA, said Thursday that detective Hilton Botha should be replaced, but that it's a decision for police and not prosecutors.

Police said Thursday that Botha, who gave testimony Wednesday opposing Pistorius' application for bail, faces attempted murder charges in connection with a 2011 shooting incident.

Police said Botha and two other police officers had fired at a minibus and will appear in court in May to face seven counts of attempted murder.

Pistorius is charged with premeditated murder in the Valentine's Day shooting of his girlfriend.

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How secure is the papal election?

The Conclave of Cardinals that will elect a new pope will meet in the Sistine Chapel in Vatican City.

STORY HIGHLIGHTS

• Bruce Schneier: Rules for picking a new pope are very detailed


• He says elaborate precautions are taken to prevent election fraud


• Every step of the election process is observed by people who know each other


• Schneier: Vatican's procedures, centuries in the making, are very secure

Editor's note: Bruce Schneier is a security technologist and author of "Liars and Outliers: Enabling the Trust Society Needs to Survive." In 2005, before the conclave that elected Pope Benedict XVI, Schneier wrote a piece on his blog about the process. This essay is an updated version, reflecting new information and analysis.

(CNN) -- As the College of Cardinals prepares to elect a new pope, security people like me wonder about the process. How does it work, and just how hard would it be to hack the vote?

The rules for papal elections are steeped in tradition. John Paul II last codified them in 1996, and Benedict XVI left the rules largely untouched. The "Universi Dominici Gregis on the Vacancy of the Apostolic See and the Election of the Roman Pontiff" is surprisingly detailed.

Every cardinal younger than 80 is eligible to vote. We expect 117 to be voting. The election takes place in the Sistine Chapel, directed by the church chamberlain. The ballot is entirely paper-based, and all ballot counting is done by hand. Votes are secret, but everything else is open.

Bruce Schneier

First, there's the "pre-scrutiny" phase.

"At least two or three" paper ballots are given to each cardinal, presumably so that a cardinal has extras in case he makes a mistake. Then nine election officials are randomly selected from the cardinals: three "scrutineers," who count the votes; three "revisers," who verify the results of the scrutineers; and three "infirmarii," who collect the votes from those too sick to be in the chapel. Different sets of officials are chosen randomly for each ballot.

Each cardinal, including the nine officials, writes his selection for pope on a rectangular ballot paper "as far as possible in handwriting that cannot be identified as his." He then folds the paper lengthwise and holds it aloft for everyone to see.

When everyone has written his vote, the "scrutiny" phase of the election begins. The cardinals proceed to the altar one by one. On the altar is a large chalice with a paten -- the shallow metal plate used to hold communion wafers during Mass -- resting on top of it. Each cardinal places his folded ballot on the paten. Then he picks up the paten and slides his ballot into the chalice.

Pope may change rules to allow earlier election

If a cardinal cannot walk to the altar, one of the scrutineers -- in full view of everyone -- does this for him.

If any cardinals are too sick to be in the chapel, the scrutineers give the infirmarii a locked empty box with a slot, and the three infirmarii together collect those votes. If a cardinal is too sick to write, he asks one of the infirmarii to do it for him. The box is opened, and the ballots are placed onto the paten and into the chalice, one at a time.

When all the ballots are in the chalice, the first scrutineer shakes it several times to mix them. Then the third scrutineer transfers the ballots, one by one, from one chalice to another, counting them in the process. If the total number of ballots is not correct, the ballots are burned and everyone votes again.

To count the votes, each ballot is opened, and the vote is read by each scrutineer in turn, the third one aloud. Each scrutineer writes the vote on a tally sheet. This is all done in full view of the cardinals.

The total number of votes cast for each person is written on a separate sheet of paper. Ballots with more than one name (overvotes) are void, and I assume the same is true for ballots with no name written on them (undervotes). Illegible or ambiguous ballots are much more likely, and I presume they are discarded as well.

Then there's the "post-scrutiny" phase. The scrutineers tally the votes and determine whether there's a winner. We're not done yet, though.

The revisers verify the entire process: ballots, tallies, everything. And then the ballots are burned. That's where the smoke comes from: white if a pope has been elected, black if not -- the black smoke is created by adding water or a special chemical to the ballots.

Being elected pope requires a two-thirds plus one vote majority. This is where Pope Benedict made a change. Traditionally a two-thirds majority had been required for election. Pope John Paul II changed the rules so that after roughly 12 days of fruitless votes, a simple majority was enough to elect a pope. Benedict reversed this rule.

How hard would this be to hack?

First, the system is entirely manual, making it immune to the sorts of technological attacks that make modern voting systems so risky.

Second, the small group of voters -- all of whom know each other -- makes it impossible for an outsider to affect the voting in any way. The chapel is cleared and locked before voting. No one is going to dress up as a cardinal and sneak into the Sistine Chapel. In short, the voter verification process is about as good as you're ever going to find.

A cardinal can't stuff ballots when he votes. The complicated paten-and-chalice ritual ensures that each cardinal votes once -- his ballot is visible -- and also keeps his hand out of the chalice holding the other votes. Not that they haven't thought about this: The cardinals are in "choir dress" during the voting, which has translucent lace sleeves under a short red cape, making sleight-of-hand tricks much harder. Additionally, the total would be wrong.

The rules anticipate this in another way: "If during the opening of the ballots the scrutineers should discover two ballots folded in such a way that they appear to have been completed by one elector, if these ballots bear the same name, they are counted as one vote; if however they bear two different names, neither vote will be valid; however, in neither of the two cases is the voting session annulled." This surprises me, as if it seems more likely to happen by accident and result in two cardinals' votes not being counted.

Ballots from previous votes are burned, which makes it harder to use one to stuff the ballot box. But there's one wrinkle: "If however a second vote is to take place immediately, the ballots from the first vote will be burned only at the end, together with those from the second vote." I assume that's done so there's only one plume of smoke for the two elections, but it would be more secure to burn each set of ballots before the next round of voting.

The scrutineers are in the best position to modify votes, but it's difficult. The counting is conducted in public, and there are multiple people checking every step. It'd be possible for the first scrutineer, if he were good at sleight of hand, to swap one ballot paper for another before recording it. Or for the third scrutineer to swap ballots during the counting process. Making the ballots large would make these attacks harder. So would controlling the blank ballots better, and only distributing one to each cardinal per vote. Presumably cardinals change their mind more often during the voting process, so distributing extra blank ballots makes sense.

There's so much checking and rechecking that it's just not possible for a scrutineer to misrecord the votes. And since they're chosen randomly for each ballot, the probability of a cabal being selected is extremely low. More interesting would be to try to attack the system of selecting scrutineers, which isn't well-defined in the document. Influencing the selection of scrutineers and revisers seems a necessary first step toward influencing the election.

If there's a weak step, it's the counting of the ballots.

There's no real reason to do a precount, and it gives the scrutineer doing the transfer a chance to swap legitimate ballots with others he previously stuffed up his sleeve. Shaking the chalice to randomize the ballots is smart, but putting the ballots in a wire cage and spinning it around would be more secure -- albeit less reverent.

I would also add some kind of white-glove treatment to prevent a scrutineer from hiding a pencil lead or pen tip under his fingernails. Although the requirement to write out the candidate's name in full provides some resistance against this sort of attack.

Probably the biggest risk is complacency. What might seem beautiful in its tradition and ritual during the first ballot could easily become cumbersome and annoying after the twentieth ballot, and there will be a temptation to cut corners to save time. If the Cardinals do that, the election process becomes more vulnerable.

A 1996 change in the process lets the cardinals go back and forth from the chapel to their dorm rooms, instead of being locked in the chapel the whole time, as was done previously. This makes the process slightly less secure but a lot more comfortable.

Of course, one of the infirmarii could do what he wanted when transcribing the vote of an infirm cardinal. There's no way to prevent that. If the infirm cardinal were concerned about that but not privacy, he could ask all three infirmarii to witness the ballot.

There are also enormous social -- religious, actually -- disincentives to hacking the vote. The election takes place in a chapel and at an altar. The cardinals swear an oath as they are casting their ballot -- further discouragement. The chalice and paten are the implements used to celebrate the Eucharist, the holiest act of the Catholic Church. And the scrutineers are explicitly exhorted not to form any sort of cabal or make any plans to sway the election, under pain of excommunication.

The other major security risk in the process is eavesdropping from the outside world. The election is supposed to be a completely closed process, with nothing communicated to the world except a winner. In today's high-tech world, this is very difficult. The rules explicitly state that the chapel is to be checked for recording and transmission devices "with the help of trustworthy individuals of proven technical ability." That was a lot easier in 2005 than it will be in 2013.

What are the lessons here?

First, open systems conducted within a known group make voting fraud much harder. Every step of the election process is observed by everyone, and everyone knows everyone, which makes it harder for someone to get away with anything.

Second, small and simple elections are easier to secure. This kind of process works to elect a pope or a club president, but quickly becomes unwieldy for a large-scale election. The only way manual systems could work for a larger group would be through a pyramid-like mechanism, with small groups reporting their manually obtained results up the chain to more central tabulating authorities.

And third: When an election process is left to develop over the course of a couple of thousand years, you end up with something surprisingly good.

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The opinions expressed in this commentary are solely those of Bruce Schneier.

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Tribune exclusive: 'We were just regular parents who were slapped in the face'

The parents of slain teen Hadiya Pendleton talk about her life and death and the issues raised after she died. (Chris Walker/Chicago Tribune)

11:57 p.m. CST, February 20, 2013

Hadiya Pendleton’s parents haven’t had much time to reminisce about their daughter’s life and death before Wednesday, when they sat down for an exclusive interview with the Tribune.

Cleopatra Cowley-Pendleton recalled getting the phone call on Jan. 29 that her 15-year-old daughter had been shot, and rushing to the hospital only to find out it was too late, her daughter was dead.

A whirlwind of activity followed as Hadiya became a national symbol of gun violence and her parents traveled to Washington for President Barack Obama’s State of the Union speech.

“I’m not going to be extremely political, but if I can help someone else not go through what we’ve gone through, then I have to do what I can,” Cowley-Pendleton said. “These are the cards we have been dealt. If these are the shoes I need to walk in, I don’t mind walking in them.”

To read the full story, you must be a digitalPlus member.

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French hostages seized in Cameroon found safe: report

PARIS (Reuters) - Seven French hostages kidnapped in Cameroon have been found alive in a house in northern Nigeria and are safe with Nigerian authorities, French television reported on Thursday.

The hostages, four children and three adults, were captured by Islamist militants this week while on a tourist excursion to the Waza national park near the Nigerian border with Cameroon.

It was the first case of foreigners being seized in the mainly Muslim north of Cameroon, a former French colony, but the region is considered within the operational sphere of Islamist sect Boko Haram and fellow Nigerian Islamist militants Ansaru.

"The hostages are safe and sound and are in the hands of Nigerian authorities," BFMTV quoted an officer from Cameroon's army as saying.

France's minister for veterans' affairs, who told parliament on Thursday that seven hostages abducted from Cameroon had been released, said minutes later there was no official confirmation that they had been freed.

A French diplomatic source said there would be no official confirmation until French authorities had received physical proof the hostages had been freed or they were in French hands.

(Reporting By Emile Picy and Nicholas Vinocur in Paris; Additional reporting by Joe Brock in Abuja; Editing by Pravin Char)

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Stock index futures signal more gains

LONDON (Reuters) - U.S. stock index futures pointed to a slightly firmer open on Wall Street on Wednesday, with futures for the S&P 500 and Dow Jones 0.1 percent higher at 0936 GMT, while those for the Nasdaq 100 added 0.2 percent.

U.S. producer prices, housing starts and building permits for January are all due at 1330 GMT, with the data expected to show a slight acceleration in factory price pressures alongside a continued recovery in the housing market.

The market focus, though, is likely to be on the minutes from the U.S. Federal Open Market Committee's January meeting, due at 1900 GMT, which will be scanned for clues on how long monetary policy is likely to remain ultra accommodative.

The earnings season continues, with Devon Energy Corp., Fluor Corp. and Newfield Exploration among those due to report.

With the season now three quarters of the way through, 28 percent of S&P 500 companies have missed full-year earnings forecasts, with 41 percent undershooting on revenues, according to Thomson Reuters StarMine data.

Dell Inc : The world's No.3 maker of personal computers reported a 31 percent drop in profit, hurt by a shrinking consumer business, as investors weighed founder Michael Dell's offer to buy out the firm.

Demand Media Inc : The company said it is exploring the separation of its media business from its domain name service, a disclosure that sent its shares up nearly 20 percent in after-hours trading.

Boeing : The aircraft maker has found a way to fix battery problems with its grounded 787 Dreamliner jets which involves increasing the space between cells, a source familiar with the U.S. company's plans told Reuters.

Life Technologies : An $11 billion-plus sale of Life Technologies Corp is looking less likely as a gap in price expectations with the company has left potential buyer Thermo Fisher Scientific Inc skeptical about a deal while buyout firms' offers came up short, people familiar with the matter said this week.

Herbalife : The diet supplements company raised its 2013 earnings forecast late on Tuesday.

Heinz : The FBI is looking into possible insider trading in the options of the ketchup maker before its blockbuster deal last week to be acquired by Warren Buffett and Brazil's 3G Capital.

Sina Corp : The operator of China's largest online portal posted better-than-expected fourth-quarter revenue and profit amid concerns about the slowing growth of Chinese online advertising.

Milennial Media : The mobile advertising firm's fourth-quarter sales missed Wall Street expectations, and the company forecast first-quarter revenue below analysts' estimates, sending its shares down as much as 33 percent after the bell.

Marriott International : The hotel operator reported better-than-expected quarterly results, aided by rising international travel and higher rates, and said it expects per-room revenue to rise further in 2013.

Nabors Industries : The owner of the world's largest onshore drilling rig fleet, reported a 44 percent jump in profit, but revenue fell as its major customers curtailed spending amid the worst slowdown in gas-directed drilling in more than a decade.

Total System Services Inc : The Payment processor said it will buy prepaid debit card provider NetSpend Holdings Inc for about $1.4 billion in cash to expand its presence in the prepaid card market and target new customers.

European shares traded flat on Wednesday, consolidating after the previous session's sharp gains, held back by weak earnings newsflow and as traders cited caution ahead of the minutes to the U.S. Federal Reserve's January policy meeting. <.eu/>

The Dow Jones industrial average <.dji> gained 53.91 points, or 0.39 percent on Tuesday to 14,035.67 points - just 0.9 percent away from its record high. The Standard & Poor's 500 Index <.spx> closed up 0.73 percent at 1,530.94, while the Nasdaq Composite Index <.ixic> added or 0.68 percent to 3,213.59.

(Reporting By Toni Vorobyova; Editing by Susan Fenton)

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Police oppose bail for Pistorius

PRETORIA, South Africa (AP) — Killing suspect Oscar Pistorius is a flight risk and should not be granted bail, South African police argued in court Wednesday.

Pistorius is charged with premeditated murder for the Valentine's Day shooting death of girlfriend Reeva Steenkamp with a 9 mm pistol.

Pistorius asserted in a court affidavit Tuesday that the shooting was accidental and he thought the model was an intruder in his home.

Police officer Hilton Botha said in the star athlete's bail hearing Wednesday that Pistorius illegally possessed .38-caliber ammunition in a safe in his bedroom. The policeman testified that Pistorius did not have a license for a .38-caliber weapon and consequently possession of that ammunition was illegal.

The detective said that all Pistorius would say after the shooting was "he thought it was a burglar."

In an additional revelation Wednesday, police said they found two boxes of testosterone and needles in the Pistorius' bedroom.

Pistorius' defense lawyer, Barry Roux, said the substance found in the bedroom was a "herbal remedy" not a steroid and not a banned substance.

Prosecutor Gerrie Nel said police are not saying that Pistorius used the substance, simply that it was found in his bedroom.

Pistorius became the first Paralympian runner to compete at the Olympic Games in London last year.

Pistorius, 26, has insisted he shot the 29-year-old Steenkamp by mistake, fearing there was an intruder in his gated and guarded luxury complex in the capital, Pretoria.

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Obama can't kick his legacy down road

By Gloria Borger, CNN Chief Political Analyst

February 19, 2013 -- Updated 2122 GMT (0522 HKT)

President Obama has a small window of opportunity to get Congress to act on his priorities, Gloria Borger says.

STORY HIGHLIGHTS

• Gloria Borger: Prospect of deep budget cuts was designed to compel compromise


• She says the "unthinkable" cuts now have many supporters


• The likelihood that cuts may happen shows new level of D.C. dysfunction, she says


• Borger: President may want a 2014 House victory, but action needed now

(CNN) -- So let's try to recount why we are where we are. In August 2011, Washington was trying to figure out how to raise the debt ceiling -- so the US might continue to pay its bills -- when a stunt was hatched: Kick the can down the road.

And not only kick it down the road, but do it in a way that would eventually force Washington to do its job: Invent a punishment.

Gloria Borger

If the politicians failed to come up with some kind of budget deal, the blunt instrument of across-the-board cuts in every area would await.

Unthinkable! Untenable!

Until now.

In fact, something designed to be worse than any conceivable agreement is now completely acceptable to many.

And not only are these forced budget cuts considered acceptable, they're even applauded. Some Republicans figure they'll never find a way to get 5% across-the-board domestic spending cuts like this again, so go for it. And some liberal Democrats likewise say 8% cuts in military spending are better than anything we might get on our own, so go for it.

The result: A draconian plan designed to force the two sides to get together has now turned out to be too weak to do that.

And what does that tell us? More about the collapse of the political process than it does about the merits of any budget cuts. Official Washington has completely abdicated responsibility, taking its dysfunction to a new level -- which is really saying something.

We've learned since the election that the second-term president is feeling chipper. With re-election came the power to force Republicans to raise taxes on the wealthy in the fiscal cliff negotiations, and good for him. Americans voted, and said that's what they wanted, and so it happened. Even the most sullen Republicans knew that tax fight had been lost.

Points on the board for the White House.

Now the evil "sequester" -- the forced budget cuts -- looms. And the president proposes what he calls a "balanced" approach: closing tax loopholes on the rich and budget cuts. It's something he knows Republicans will never go for. They raised taxes six weeks ago, and they're not going to do it again now. They already gave at the office. And Republicans also say, with some merit, that taxes were never meant to be a part of the discussion of across-the-board cuts. It's about spending.

Here's the problem: The election is over. Obama won, and he doesn't really have to keep telling us -- or showing us, via staged campaign-style events like the one Tuesday in which he used police officers as props while he opposed the forced spending cuts.

What we're waiting for is the plan to translate victory into effective governance.

Sure, there's no doubt the president has the upper hand. He's right to believe that GOP calls for austerity do not constitute a cohesive party platform. He knows that the GOP has no singular, effective leader, and that its message is unformed. And he's probably hoping that the next two years can be used effectively to further undermine the GOP and win back a Democratic majority in the House.

Slight problem: There's plenty of real work to be done, on the budget, on tax reform, on immigration, climate change and guns. A second-term president has a small window of opportunity. And a presidential legacy is not something that can be kicked down the road.

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The opinions expressed in this commentary are solely those of Gloria Borger.

Part of complete coverage on

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Since Canada will not tolerate an influx of zombies, we have to get ready and secure our borders, says Dean Obeidallah.

February 18, 2013 -- Updated 2259 GMT (0659 HKT)

Pablo Spiller says consumers will likely get more choices and improved quality of service.

February 18, 2013 -- Updated 1629 GMT (0029 HKT)

Convincing Congress to take on climate change will be an uphill battle, unless there's strong grass roots support, says Julian Zelizer.

February 17, 2013 -- Updated 1337 GMT (2137 HKT)

Bob Greene says the stories of former slaves, compiled in 1930s, tell of families torn apart, people deprived of basic freedoms

February 18, 2013 -- Updated 0028 GMT (0828 HKT)

Cameron Russell says her looks fit a narrow definition of beauty and her career as a model gives her views undeserved attention

February 19, 2013 -- Updated 0116 GMT (0916 HKT)

Meg Urry says the likelihood that a meteor hits and an asteroid passes close by Earth on the same day is quite improbable, yet the two events happened on Friday

February 19, 2013 -- Updated 1728 GMT (0128 HKT)

Frida Ghitis says the murder of Reeva Steenkamp allegedly by Oscar Pistorius is a reminder that we have to do more to protect women.

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