Global shares dip on U.S. fiscal cliff, Greece woes

LONDON (Reuters) - World shares edged down for a fourth day on Monday as concerns about a potential U.S. fiscal crisis and Greece's bailout dented optimism over global growth.

Adding to the uncertainty, Japan reported that its economy shrank 0.9 percent in July-September from the previous quarter, pointing to a mild recession in the world's third-largest economy.

"Investors remain consumed by U.S. fiscal cliff consequences, and this is capping market enthusiasm," said Tim Waterer, senior trader at CMC Markets.

Since the U.S. elections, the investors have worried that the return of the status quo in Washington will make it difficult for lawmakers to reach the compromises needed to avoid a "fiscal cliff" at the end of the year when nearly $600 billion worth of spending cuts and tax increases kick in.

The MSCI world equity index <.miwd00000pus>, which was down 0.1 percent at 322.80 points on Monday, has lost about 2 percent since President Barack Obama's re-election and the Republican Party retained its majority in the House of Representatives.

European shares were little changed.

Export data out of China suggesting that seven straight quarters of slowing growth may have ended provided some support however, the positive data was offset by weak bank loan figures.

The FTSEurofirst 300 index <.fteu3> of top European shares was steady at 1,096.85 points, having dropped 1.6 percent last week. London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> traded between 0.2 percent up and 0.1 percent lower. <.l><.eu/>

U.S. stock index futures pointed to a similarly mixed open on Wall Street, with futures for the S&P 500 up 0.15 percent, Dow Jones futures up 0.03 percent and Nasdaq 100 futures down 0.1 percent.

GREECE STALLS

A green light for the Greek government's 2013 budget from the parliament in Athens on Sunday had little impact on the euro, which hovered at $1.2705 to the dollar and is not far from the two-month low of $1.2690 hit on Friday.

The budget vote, and another on an austerity package last week were conditions for unlocking the next tranche of aid from Greece's international bailout.

Markets are looking ahead to a euro zone finance ministers' meeting later in the day for signs the money will be released.

The pressure for a deal on Greece is growing because Athens has to redeem 5 billion euros ($6.35 billion)worth of treasury bills this week and had been counting on cash from the next aid tranche to help cover that.

Germany's Finance Minister Wolfgang Schaeuble said at the weekend that the troika of international lenders had not yet finished its report on the bailout programme.

"I think we've seen too many finance ministers' meetings over the course of the last two or three years to have any great expectations," Peter Dixon, global equities economist at Commerzbank, said.

The uncertainty over the Greek aid talks and the U.S. fiscal worries supported German government bonds, with German 10-year yields steady at 1.34 percent.

European credit markets were also fairly flat with the iTraxx main index, made up of 125 investment-grade bonds, 0.5 basis points wider at 132 basis points.

U.S. bond markets were closed on Monday for the Veteran's Day public holiday.

Commodities were mixed, with Brent oil trading around $109 per barrel and U.S. crude sliding under $86 a barrel, while gold edged up to $1,734 an ounce, near a three-week high of $1,738.

$1 = 0.7868 euros)

(Editing by Will Waterman and Anna Willard)

Read More..

Israel says ready to escalate as Hamas joins Gaza clashes

GAZA/JERUSALEM (Reuters) - Israel said it was poised to escalate attacks on the Gaza Strip on Sunday following a surge of rocket and mortar salvoes by Hamas and other factions in the Palestinian enclave.

A missile strike wounded four Israeli troops on jeep patrol along the Gaza boundary on Saturday, triggering army shelling that killed four Palestinian civilians and, in turn, dozens of short-range rocket launches out of Gaza that paralyzed Israel's southern border towns.

Two Gaza militants died in the ensuing Israeli air strikes.

Israel went to war against Hamas in the winter of 2008-2009 but has shown little appetite for a new round that could strain fraught relations with the new Islamist-rooted government in neighboring Egypt, which made peace with Israel in 1979.

But conservative Prime Minister Benjamin Netanyahu may be reluctant to seem weak ahead of a January 22 general election that opinion polls currently predict he will win.

"The world needs to understand that Israel will not sit with arms crossed when faced by attempts to hurt us. And we are prepared to harshen the response," Netanyahu told his cabinet in remarks aired by Israeli broadcasters.

After not openly taking part in Saturday's fighting, which included the firing of dozens of Palestinian short-range rockets and mortar bombs, Hamas issued a joint statement with five other factions claiming responsibility for Sunday's fresh salvoes.

Though hostile to the Jewish state, Islamist Hamas has in the past avoided such clashes as it tries to consolidate its Gaza rule and convince Egypt's new rulers that it can be a stabilizing force.

PROBING THE FENCE

Israeli officials have at times noted Hamas's efforts to impose calm in Gaza, which it has governed since 2007, and maintain a policy of holding it solely responsible for any violence from the coastal territory, whoever is firing.

Four Israelis were wounded by rockets on Sunday, a military spokeswoman said. Southern Israeli municipalities ordered residents to shelters and shuttered some schools.

Islamic Jihad, a smaller faction than Hamas which often operates independently, said one rocket crewman was killed by an Israeli air strike on Sunday, after another member was killed on Saturday while photographing the fighting.

Defence Minister Ehud Barak, a centrist in Israel's coalition government, played down speculation that the upcoming election was affecting Gaza policy.

"I don't think the election should be a consideration in how we respond. It is not meant to make us avoid action ... nor is it meant to provoke us into grabbing some kind of opportunity for an operation," Barak told Israel's Army Radio.

The 2008-2009 Gaza conflict coincided with an election campaign and, four years on, some Israeli analysts see the same dynamics building.

Barak described Saturday's jeep ambush as part of a Palestinian strategy of raising the cost of Israel's countermeasures against cross-border infiltration. Israeli forces often mount hunts for tunnels and landmines on the inside of the Gaza boundary, creating a no-go zone for Palestinians.

"Of course we don't accept their attempt to change the rules," Barak said. "The essence of the struggle is over the fence. We intend to enable the IDF (Israel Defense Forces) to work not just on our side but on the other side as well."

Palestinians said four of Saturday's dead were civilians hit by an Israeli tank shell while paying respects at a crowded mourning tent in Gaza's Shijaia neighborhood. Israel denies targeting civilians.

(Writing by Dan Williams; Editing by Crispian Balmer and Douglas Hamilton)

Read More..

Buzzmakers: Brooke's Cancer Fight & World War Z

What had ET readers buzzing this week?

1. It's Brad vs. Zombies in World War Z

Zombie attack!!! Brad Pitt plays a family man and United Nations employee who faces a deadly zombie pandemic in World War Z -- we gave you an exclusive first look and now we've got the intense trailer!

Just when you thought that the zombie genre may be starting to generate less screams and more Zzzz's, World War Z arrives with an adrenaline shot in the arm for the genre -- complete with insane special effects and a claustrophobic urgency and realism not seen since the introduction of those "speed zombies" in 28 Days Later.

Directed by Marc Forster (Quantum of Solace), World War Z invades theaters June 21, 2013.

2. Oprah Reveals Her 2012 'Favorite Things'

It's officially the holiday season!

Oprah just revealed her "Favorite Things" for 2012, which includes such items as a $1,800 Jetson E-Bike, a $192 hand-picked Tom Ford lipstick palette and a $238 Lafco soap set.

"This luxuriously oversize, deliciously scented soap is my new go-to gift. I even brought a set to Mr. and Mrs. Colbert when I interviewed Stephen for Next Chapter," she says about the pricey soap set.

But of course if you don't have the income of Oprah, you can pick up O's December issue to learn how you can win all 49 of Oprah's favorite things, which hits newsstands November 6.

"Oprah's Favorite Things" is also getting its own two-hour, prime time special airing Nov. 18 on OWN. The special will surprise unsuspecting military spouses with items from the media mogul's exclusive must-have gift selections for the holiday season, and for the first time, viewers of Oprah's Favorite Things: 2012 will have the opportunity to watch and win select items featured in each segment of the show.

3. Brooke Burke-Charvet Reveals Cancer Diagnosis

Brooke Burke-Charvet released a video online Thursday to announce that she was recently diagnosed with a cancerous growth on her thyroid gland. In the video posted on her Modern Mom blog, the 41-year-old actress and TV host explained that a nodule was discovered on her thyroid and after a series of tests over the last few months, it was eventually determined to be cancerous and her thyroid will have to be removed.

"Which means that I'm going to have a nice big scar right her across my neck," Brooke said. "And I don't get to just walk around and pretend like nothing happened or not follow up or not share it, because it's going to be pretty much dead center."

Brooke said the discovery -- which originated from a regular physical -- came as a complete shock because she's otherwise healthy. "As crazy as it is, my head is in the right place, and it's going to be good," she said, adding that the doctors consider this a form of "good cancer" compared to many others and the prognosis is good. "I'm just going to make a positive out of this negative thing."

She said the surgery has been scheduled and she promised to keep her fans updated through her blog. "Now I'm ready to deal with it and I'm going to be fine. And I feel really, really strong."

Speaking on Thursday's episode of The Talk, Brooke's co-host on Dancing with the Stars, Tom Bergeron, commented on her cancer diagnosis. "My love and support are with you -- we are all there with her," he said. Bergeron added that he personally has a very positive outlook. "I've known about this for a few months. I have had experience with this in my family. You never want to hear the word cancer. But thyroid cancer is one of the most treatable cancers. It has an incredibly high success rate."

4. Kirstie on Secret Relationship with Swayze

Kirstie Alley reveals to ET's Chris Jacobs intimate details about what she says was a powerful attraction and hidden relationship with her North and South co-star, Patrick Swayze. Although both stars were married during filming of the mini-series, Alley tells Jacobs when she first saw Swayze, they had an intense attraction and she tried to avoid "going down that road," but they ultimately fell in love.

"Both of us were married. We did not have an affair. But again, I think what I did was worse. Because I think when you fall in love with someone when you're married, you jeopardize your own marriage and their marriage. It's doubly bad," said Alley.

Alley goes on to say that although she's friends with Patrick's wife, Lisa Niemi, who asked Alley to speak at Swayze's funeral, she is uncertain if Lisa is aware of their relationship.

5. One Direction & Drew Brees Play Catch - Exclusive

One Direction and Drew Brees teamed up last month to film an adorable Pepsi spot and during Thursday night's episode of The X Factor, the band will not only perform their newest singles, Live While We're Young and Little Things, but also reveal an alternate ending to the ad!

For those who missed the spot, the original ended with Drew Brees sacrificing his last can of Pepsi in order to become an unofficial member of One Direction. But, according to Angelique Krembs, VP Marketing for Pepsi, they also wanted to show fans what would happen if Drew won the last can of Pepsi. "Our latest Live For Now spot has received an enormous amount of buzz and online excitement," Krembs said. "And of course everyone wants to see the boys from 1D suit up in football gear and have some fun."

While you have to wait until Thursday to see the entire surprise ending to Pepsi's Live For Now television commercial, ETonline scored an exclusive sneak peek of One Direction tossing the pigskin around with Brees!

Tune in to The X Factor on November 8 at 8 p.m. to see the alternate ending!

Read More..

Malaria vaccine a letdown for infants

LONDON (AP) — An experimental malaria vaccine once thought promising is turning out to be a disappointment, with a new study showing it is only about 30 percent effective at protecting infants from the killer disease.

That is a significant drop from a study last year done in slightly older children, which suggested the vaccine cut the malaria risk by about half — though that is still far below the protection provided from most vaccines. According to details released on Friday, the three-shot regimen reduced malaria cases by about 30 percent in infants aged 6 to 12 weeks, the target age for immunization.

Dr. Jennifer Cohn, a medical coordinator at Doctors Without Borders, described the vaccine's protection levels as "unacceptably low." She was not linked to the study.

Scientists have been working for decades to develop a malaria vaccine, a complicated endeavor since the disease is caused by five different species of parasites. There has never been an effective vaccine against a parasite. Worldwide, there are several dozen malaria vaccine candidates being researched.

In 2006, a group of experts led by the World Health Organization said a malaria vaccine should cut the risk of severe disease and death by at least half and should last longer than one year. Malaria is spread by mosquitoes and kills more than 650,000 people every year, mostly young children and pregnant women in Africa. Without a vaccine, officials have focused on distributing insecticide-treated bed nets, spraying homes with pesticides and ensuring access to good medicines.

In the new study, scientists found babies who got three doses of the vaccine had about 30 percent fewer cases of malaria than those who didn't get immunized. The research included more than 6,500 infants in Africa. Experts also found the vaccine reduced the amount of severe malaria by about 26 percent, up to 14 months after the babies were immunized.

Scientists said they needed to analyze the data further to understand why the vaccine may be working differently in different regions. For example, babies born in areas with high levels of malaria might inherit some antibodies from their mothers which could interfere with any vaccination.

"Maybe we should be thinking of a first-generation vaccine that is targeted only for certain children," said Dr. Salim Abdulla of the Ifakara Health Institute in Tanzania, one of the study investigators.

Results were presented at a conference in South Africa on Friday and released online by the New England Journal of Medicine. The study is scheduled to continue until 2014 and is being paid for by GlaxoSmithKline and the PATH Malaria Vaccine Initiative.

"The results look bad now, but they will probably be worse later," said Adrian Hill of Oxford University, who is developing a competing malaria vaccine. He noted the study showed the Glaxo vaccine lost its potency after several months. Hill said the vaccine might be a hard sell, compared to other vaccines like those for meningitis and pneumococcal disease — which are both effective and cheap.

"If it turns out to have a clear 30 percent efficacy, it is probably not worth it to implement this in Africa on a large scale," said Genton Blaise, a malaria expert at the Swiss Tropical and Public Health Institute in Basel, who also sits on a WHO advisory board.

Eleanor Riley of the London School of Hygiene and Tropical Medicine, said the vaccine might be useful if used together with other strategies, like bed nets. She was involved in an earlier study of the vaccine and had hoped for better results. "We're all a bit frustrated that it has proven so hard to make a malaria vaccine," she said. "The question is how much money are the funders willing to keep throwing at it."

Glaxo first developed the vaccine in 1987 and has invested $300 million in it so far.

WHO said it couldn't comment on the incomplete results and would wait until the trial was finished before drawing any conclusions.

Read More..

Wall Street Week Ahead: "Fiscal cliff" blues may lead to correction

NEW YORK (Reuters) - Wall Street's post-election sell-off may gather steam in the coming weeks as worries mount about the looming "fiscal cliff" and technical weakness suggests a possible correction ahead.

The benchmark Standard & Poor's 500 <.spx> closed below its 200-day moving average - a measure of the market's long-term trend - on Thursday for the first time in five months, and ended below it again on Friday. More than half of the Dow components are trading below key technical levels.

"I don't think you have to panic here, but I think you really want to be looking for the market to move lower for the next couple of months," said Frank Gretz, market analyst and technician for Wellington Shields & Co., a brokerage in New York. "I think the next rally is the rally you want to sell."

At the heart of the market's worry is whether U.S. leaders can come to agreement on some $600 billion in spending cuts and tax increases that are due to kick in early next year. Some fear dramatic cutbacks could send the U.S. economy into another recession.

The prospect of higher tax rates in 2013 is driving investors to sell shares as they seek to decrease the tax impact from their positions this year and next.

"You would have thought the fiscal cliff scenarios would have been already mulled over and priced in, but they weren't. It's almost like the market has ADD and can only focus on one thing at a time," said Natalie Trunow, chief investment officer of equities at Calvert Investment Management in Bethesda, Maryland, whose firm manages about $13 billion in assets.

The S&P 500 fell 2.4 percent for the week, its worst weekly percentage drop since June. The index is now down 6.4 percent from its intraday high for the year of 1,474.51 reached on September 14. That drop puts the benchmark index below its 50-day moving average, but not yet into correction territory, defined as a 10 percent drop from a peak.

READING THE TECHNICAL SIGNS

The S&P 500 has been trading in a range between the 50-day moving average of 1,433.50 and the 200-day moving average of 1,380.98 for about two weeks. A significant break below that lower level could be a precursor to further weakness, analysts said.

"There's a technical breakdown in the market that indicates further losses," said Adam Sarhan, chief executive of Sarhan Capital in New York. "A 10 percent drop is the next big line in the sand."

The primary driver of stock prices in coming weeks looks likely to be investor concern about the U.S. fiscal situation.

In a sign of the risks involved, comments by President Barack Obama on Friday about the upcoming negotiations caused stocks to sharply cut their gains.

The president, who defeated Republican candidate Mitt Romney in Tuesday's U.S. election, outlined a position for the fiscal issues on Friday that is far apart from that of his political opponents, suggesting a long battle is to come.

"If the market anticipates a resolution to the fiscal cliff or Europe or any of the other bricks in the wall of worry, we could easily take off," Sarhan said.

Seventeen of the Dow's 30 components are trading below both their 50-day and 200-day moving averages, while another eight are under their 50-day levels, but not their 200. Only five components - Bank of America , JPMorgan Chase & Co , Home Depot Inc , Johnson & Johnson and Travelers Cos - are above both support levels.

Another big negative for the market has been heavy selling of Apple shares. The stock of the world's biggest company, ranked by market capitalization, lost 5.2 percent this week, weighing heavily on both the S&P 500 and the Nasdaq <.ixic>. The stock is down 22.4 percent from its September 21 all-time intraday high of $705.07.

BIG RETAILERS' REPORT CARDS

The election and fiscal cliff concerns, which came on the heels of Superstorm Sandy and its devastating effects on many parts of the U.S. Northeast, have captured so much attention that they've overshadowed weakness coming from third-quarter earnings.

With results in from 449 of the S&P 500 companies, third-quarter earnings now are estimated to have declined 0.3 percent from a year ago, which is slightly better than the forecast at the start of the reporting period. Results have been especially weak on the revenue side, however, with just 38 percent of companies beating on sales, Thomson Reuters data showed.

But recent stronger economic data, including a report on Friday showing consumer sentiment at more than a five-year high in early November, suggests that retailers, many of which have yet to report, could be among the stronger performers this earnings period.

Next week, results are expected from such big names as Target , Wal-Mart and Home Depot.

Consumer discretionary companies have outperformed the broader S&P 500 in earnings, with 72 percent of the companies in that sector beating analysts' expectations, compared with 63 percent for the S&P 500 as a whole.

Investors will be paying close attention to those results with the holiday shopping period around the corner, said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey, which oversees about $1 billion in assets.

"It's really the beginning of the Christmas sell season, and I think there's going to be a lot of interest with the outlook for that season and how promotional companies are going to be," Meckler said.

(Wall St Week Ahead runs every Friday. Questions or comments on this column can be emailed to: caroline.valetkevitch(at)thomsonreuters.com )

(Reporting by Caroline Valetkevitch and Ryan Vlastelica; Editing by Jan Paschal)

Read More..