Cliff fight may knock out December rally

NEW YORK (Reuters) – In normal times, next week’s slew of U.S. economic data could be a springboard for a December rally in the stock market.

December is historically a strong month for markets. The S&P 500 has risen 16 times in the past 20 years during the month.

But the market hasn’t been operating under normal circumstances since November 7 when a day after the U.S. election, investors’ focus shifted squarely to the looming “fiscal cliff.”

Investors are increasingly nervous about the ability of lawmakers to undo the $ 600 billion in tax increases and spending cuts that are set to begin in January; those changes, if they go into effect, could send the U.S. economy into a recession.

A string of economic indicators next week, which includes a key reading of the manufacturing sector on Monday, culminates with the November jobs report on Friday.

But the impact of those economic reports could be muted. Distortions in the data caused by Superstorm Sandy are discounted.

The spotlight will be more firmly on signs from Washington that politicians can settle their differences on how to avoid the fiscal cliff.

“We have a week with a lot of economic data, and obviously most of the economic data is going to reflect the effects of Sandy, and that might be a little bit negative for the market next week, but most of that is already expected – the main focus remains the fiscal cliff,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

Concerns about the cliff sent the S&P 500 <.SPX> into a two-week decline after the elections, dropping as much as 5.3 percent, only to rally back nearly 4 percent as the initial tone of talks offered hope that a compromise could be reached and investors snapped up stocks that were viewed as undervalued.

On Wednesday, the S&P 500 gained more than 20 points from its intraday low after House Speaker John Boehner said he was optimistic that a budget deal to avoid big spending cuts and tax hikes could be worked out. The next day, more pessimistic comments from Boehner, an Ohio Republican, briefly wiped out the day’s gains in stocks.

On Friday, the sharp divide between the Democrats and the Republicans on taxes and spending was evident in comments from President Barack Obama, who favors raising taxes on the wealthy, and Boehner, the top Republican in Congress, who said Obama’s plan was the wrong approach and declared that the talks had reached a stalemate.

“It’s unusual to end up with one variable in this industry, it’s unusual to have a single bullet that is the causal factor effect, and you are sitting here for the next maybe two weeks or more, on that kind of condition,” said Sandy Lincoln, chief market strategist at BMO Asset Management U.S. in Chicago.

“And that is what is grabbing the markets.”

BE CONTRARY AND MAKE MERRY

But investor attitudes and seasonality could also help spur a rally for the final month of the year.

The most recent survey by the American Association of Individual Investors reflected investor caution about the cliff. Although bullish sentiment rose above 40 percent for the first time since August 23, bearish sentiment remained above its historical average of 30.5 percent for the 14th straight week.

December is a critical month for retailers such as Target Corp and Macy’s Inc . They saw monthly retail sales results dented by Sandy, although the start of the holiday shopping season fared better.

With consumer spending making up roughly 70 percent of the U.S. economy, a solid showing for retailers during the holiday season could help fuel any gains.

Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research in Cincinnati, believes the recent drop after the election could be a market bottom, with sentiment leaving stocks poised for a December rally.

“The concerns on the fiscal cliff – as valid as they might be – could be overblown. When you look at a lot of the overriding sentiment, that has gotten extremely negative,” said Detrick.

“From that contrarian point of view with the historically bullish time frame of December, we once again could be setting ourselves up for a pretty nice end-of-year rally, based on lowered expectations.”

SOME FEEL THE BIG CHILL

Others view the fiscal cliff as such an unusual event that any historical comparisons should be thrown out the window, with a rally unlikely because of a lack of confidence in Washington to reach an agreement and the economic hit caused by Sandy.

“History doesn’t matter. You’re dealing with an extraordinary set of circumstances that could very well end up in the U.S. economy going into a recession,” said Phil Orlando, chief equity market strategist at Federated Investors in New York.

“And the likelihood of that is exclusively in the hands of our elected officials in Washington. They could absolutely drag us into a completely voluntary recession.”

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

(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)

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Noisy city: Cacophony in Caracas sparks complaints

CARACAS, Venezuela (AP) — This metropolis of 6 million people may be one of the world’s most intense, overwhelming cities, with tremendous levels of crime, traffic and social strife. The sounds of Caracas‘ streets live up to its reputation.

Stand on any downtown corner, and the cacophony can be overpowering: Deafening horns blast from oncoming buses, traffic police shrilly blow their whistles and sirens shriek atop ambulances stuck in bumper-to-bumper traffic.

Air horns routinely used by bus drivers are so powerful they make pedestrians on crosswalks recoil, and can even leave their ears ringing. Loud salsa music blares from the windows of buses, trucks with old mufflers rumble past belching exhaust, and “moto-taxis” weave through traffic beeping high-pitched horns.

Growing numbers of Venezuelans are saying they’re fed up with the noise that they say is getting worse, and the numbers of complaints to the authorities have risen in recent years.

One affluent district, Chacao, put up signs along a main avenue reading: “A honk won’t make the traffic light change.”

“The noise is terrible. Sometimes it seems like it’s never going to end,” said Jose Santander, a street vendor who stands in the middle of a highway selling fried pork rinds and potato chips to commuters in traffic.

Prosecutor General Luisa Ortega recently told a news conference that officials have started “putting an increased emphasis on promoting peaceful coexistence” by punishing misdemeanors such as violations of anti-noise regulations and other minor crimes. That effort has translated into hundreds of noise-related cases in recent years.

Some violators are ordered to perform community service. For instance, two young musicians who were recently caught playing loud music near a subway station were sentenced to 120 hours of community service giving music lessons to students in public schools.

Others caught playing loud music on the street have been charged with disturbing the peace after complaints from neighbors. Fines can run as high as 9,000 bolivars, or $ 2,093.

On the streets of their capital, however, Venezuelans have grown used to living loudly. The noisescape adds to a general sense of anarchy, with many drivers ignoring red lights and blocking intersections along potholed streets strewn with trash.

“This is something that everybody does. Nobody should be complaining,” said Gregorio Hernandez, a 23-year-old college student, as he listened to Latin rock songs booming from his car stereo on a Saturday night in downtown Caracas. “We’re just having fun. We’re not hurting anybody.”

Adding to the mess is the country’s notoriously divisive politics, which regularly fill the streets with marches and demonstrations.

On many days, the shouts of protesters streaming through downtown can be heard from blocks away, demanding pay hikes or unpaid benefits.

And the sporadic crackling of gunfire in the slums can be confused for firecrackers tossed by boisterous partygoers.

It’s difficult to rank the world’s noisiest cities because many, including Venezuela’s capital, don’t take measurements of sound pollution, said Victor Rastelli, a mechanical engineering professor and sound pollution expert at Simon Bolivar University in Caracas. But Rastelli said he suspects Caracas is right up there among the noisiest, along with Sao Paulo, Mexico City and Mumbai.

Excessive noise can be more than simply an annoyance, Rastelli said. “This is a public health problem.”

Dr. Carmen Mijares, an audiologist at a private Caracas hospital, said she treats at least a dozen patients every month for hearing damage caused by prolonged exposure to loud noises.

“Many of them work in bars or night clubs, and their maladies usually include temporary hearing loss and headaches,” Mijares said. For others, she said, the day-to-day noise of traffic, car horns and loud music can exacerbate stress and sleeping disorders.

Several cities have successfully reduced noise pollution, said Stephen Stansfeld, a London psychiatry professor and coordinator of the European Network on Noise and Health.

One of the most noteworthy initiatives, Stansfeld said, was in Copenhagen, Denmark, where officials used sound walls, noise-reducing asphalt and other infrastructure as well as public awareness campaigns to fight noise pollution.

But such high-tech solutions seem like a remote possibility in Caracas, where streets are literally falling apart and aging overpasses regularly lack portions of their guard rails. Prosecutors, angry neighbors and others hoping to fight the noise will have to persuade Venezuelans to do nothing less than change their loud behavior.

For Carlos Pinto, however, making noise is practically a political right.

The 26-year-old law student and his friends danced at a recent street party to house music booming from woofers in his car’s open trunk, with neon lights on the speakers that pulsed to the beat.

When asked about the noise, he answered: “We will be heard.”

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AP freelance video journalist Ricardo Nunes contributed to this report.

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Christopher Toothaker on Twitter: http://twitter.com/ctoothaker

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Thousands touched by photograph of New York cop helping shoeless man

NEW YORK (Reuters) – A photograph of a New York City police officer crouching by a shoeless panhandler to give him a new pair of boots on a cold night in Times Square has drawn a deluge of praise after it was published on the police department‘s Facebook page this week.

By Thursday afternoon, nearly 394,000 people had clicked a button on the department’s Facebook page to indicate that they “liked” the photograph. Tens of thousands left comments, most praising Officer Lawrence DePrimo for his charitable deed.

The photograph was snapped by Jennifer Foster, an employee of the Pinal County Sheriff‘s Office in Florence, Arizona, during a trip to New York this month, according to police.

She took the picture shortly after she noticed the man asking passersby for money.

“Right when I was about to approach, one of your officers came up behind him,” Foster wrote in an email to the New York Police Department accompanying the snapshot, according to the picture caption on the department’s Facebook page. She said she was some distance away, and the officer did not know he was being photographed.

“The officer said, ‘I have these size 12 boots for you, they are all-weather. Let’s put them on and take care of you.’ The officer squatted down on the ground and proceeded to put socks and the new boots on this man.”

DePrimo and Foster could not be reached for comment on Thursday, and the police department did not respond to queries about the photograph.

DePrimo, 25, joined the force in 2010 and lives with his parents on Long Island, according to The New York Times. He paid $ 75 for the boots from a nearby Skechers store after an employee there gave him a 25 percent discount upon learning they were to be donated to a man in need.

“I wish more cops were like this guy,” one person wrote on the department’s Facebook page. Others suggested there were plenty of good-hearted police officers about, even if their good deeds were not photographed or touted on Facebook.

(Editing by Paul Thomasch and Stacey Joyce)

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Actor who apparently killed landlady not on drugs

LOS ANGELES (AP) — An autopsy report shows no drugs were detected in the body of a former “Sons of Anarchy” actor who police say killed his landlady and then fell to his death.

Toxicology results on Johnny Lewis found no traces of cocaine, alcohol, marijuana or any other types of drugs in the actor’s system. Officials checked for anti-psychotic drugs as well as psychedelic drugs.

Lewis was found dead in September in the driveway of a Los Angeles residence, and police found his landlady and a cat dead inside the home. Officials believe Lewis fell while trying to flee the home after killing 81-year-old Catherine Davis.

The killing occurred just days after Lewis was released from jail. Records show he had pleaded no contest to assault with a deadly weapon and attempted burglary in separate cases.

Authorities expressed concern about his mental health in court hearings before his release.

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Drug, alcohol abuse tied to early-life strokes: study

(Reuters) – Younger adults who suffered a stroke were often smokers or had abused drugs or alcohol, according to a U.S. study that looked at over 1,000 patients.

Strokes are often thought of as a condition of the elderly, but researchers said long-term changes in the heart, arteries or and blood as a result of drug abuse or heavy drinking may put users at higher-than-average risk earlier in life.

“Substance abuse is common in young adults experiencing a stroke,” wrote lead researcher Brett Kissela from the University of Cincinnati in the journal Stroke.

“Patients aged younger than 55 years who experience a stroke should be routinely screened and counseled regarding substance abuse.”

It’s also possible that some drugs, particularly cocaine and methamphetamines, may trigger a stroke more immediately, according to S. Andrew Josephson, a neurologist from the University of California, San Francisco, who has studied drug use and stroke but was not involved in the study.

“We know that even with vascular risk factors that are prevalent – smoking, high blood pressure… most people still don’t have a stroke until they’re older,” he added.

“When a young person has a stroke, it is probably much more likely that the cause of their stroke is something other than traditional risk factors.”

According to the U.S. Centers for Disease Control and Prevention, close to 800,000 people in the United States have a stroke every year, and they are the most common cause of serious long-term disability. One study of 2007 data found that almost five percent of people who had a stroke that year were between ages 18 and 44.

The current study involved people from Greater Cincinnati and Northern Kentucky who’d had a stroke before they hit 55.

The researchers reviewed medical charts for blood or urine test results of other records of substance abuse for close to 1,200 stroke patients.

In 2005, the most recent year covered, just over half of young adults who suffered a stroke were smokers at the time, and one in five used illicit drugs, including marijuana and cocaine. Thirteen percent of people had used drugs or alcohol within 24 hours of their stoke.

“The rate of substance abuse, particularly illicit drug abuse, is almost certainly an underestimate because toxicology screens were not obtained on all patients,” said Steven Kittner, a professor of neurology at the University of Maryland School of Medicine in Baltimore who also wasn’t part of the research.

The rate of smoking, drug use and alcohol abuse – defined as three or more drinks per day – seemed to increase among stroke patients between the mid-1990s and the mid-2000s.

But Kissela and his team said they can’t be sure whether more people were actually using those substances or doctors were just getting better at testing for and recording drug abuse.

The study also can’t prove that patients’ drug or alcohol use directly contributed to their strokes. It’s possible, for example, that people who abuse drugs also see their doctors less often or engage in other risky behaviors that increase the chance of strokes, Josephson explained.

He added that the study emphasizes the need to learn and quickly recognizing the signs of strokes, even in young people, since some treatments can only be used in a short window of opportunity after the stroke. SOURCE: http://bit.ly/TVQvpi

(Reporting from New York by Genevra Pittman at Reuters Health; editing by Elaine Lies)

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Lawmakers unveil new round of Iran sanctions

WASHINGTON (AP) — Senators pressed ahead Thursday on a new set of tough sanctions against Iran‘s domestic industries as it seeks to cripple the Islamic republic’s economy and thwart its nuclear ambitions.

Sens. Bob Menendez, D-N.J., and Mark Kirk, R-Ill., unveiled a package of penalties that would designate Iran‘s energy, port, shipping and ship-building sectors as entities of proliferation and sanction transactions with these areas. The legislation also would penalize individuals selling or supplying commodities such as graphite, aluminum and steel to Iran.

The punitive measures build on the sanctions on Tehran’s oil industry that the two lawmakers have shepherded through Congress in the past year.

“Yes, our sanctions are having a significant impact, but Iran continues their work to develop nuclear weapons,” Menendez said in a statement, adding that with the new penalties, “We will send a message to Iran that they can’t just try to wait us out.”

Kirk said the measure “will greatly increase the economic pressure on the Iranian regime and send a clear message of support to the Iranian people.”

The sanctions are contained in an amendment the two lawmakers hope to add to a far-reaching defense policy bill that the Senate was debating and could wrap up by week’s end. Congress has overwhelmingly backed previous efforts by Menendez and Kirk.

The legislation also would designate the Islamic Republic of Iran Broadcasting and its president as human rights abusers for broadcasting forced televised confessions and show trials.

The United States and European Union have imposed tough sanctions on Iran that have weakened its economy. But Tehran has found ways to bypass the penalties, such as Turkey’s use of gold to pay for Iranian natural gas imports.

The Menendez-Kirk measure would allow the president to impose sanctions in cases of the sale or transfer of precious metals, targeting efforts by Iran to circumvent the penalties.

Iran maintains that its nuclear program is for peaceful purposes only.

Mark Dubowitz, a sanctions expert and executive director of the Foundation for Defense of Democracies, said there is strong bipartisan support for intense sanctions, with the goal of pushing the Iranian economy to the brink of economic collapse.

Only then “can the central thesis of the administration’s sanctions policy be fairly tested: That crippling economic pressure will break the nuclear will of Iran’s supreme leader and his Revolutionary Guards and lead them to meet their obligations under international law,” Dubowitz said.

The president has 90 days from the legislation’s enactment to act. The bill does include the authority to waive the sanctions based on national security.

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Rapper PSY wants Tom Cruise to go ‘Gangnam Style’

BANGKOK (AP) — The South Korean rapper behind YouTube’s most-viewed video ever has set what might be a “Mission: Impossible” for himself.

Asked which celebrity he would like to see go “Gangnam Style,” the singer PSY told The Associated Press: “Tom Cruise!”

Surrounded by screaming fans, he then chuckled at the idea of the American movie star doing his now famous horse-riding dance.

PSY’s comments Wednesday in Bangkok were his first public remarks since his viral smash video — with 838 million views — surpassed Justin Bieber‘s “Baby,” which until Saturday held the record with 803 million views.

“It’s amazing,” PSY told a news conference, saying he never set out to become an international star. “I made this video just for Korea, actually. And when I released this song — wow.”

The video has spawned hundreds of parodies and tribute videos and earned him a spotlight alongside a variety of superstars.

Earlier this month, Madonna invited PSY onstage and they danced to his song at one of her New York City concerts. MC Hammer introduced the Korean star at the American Music Awards as, “My Homeboy PSY!”

Even President Barack Obama is talking about him. Asked on Election Day if he could do the dance, Obama replied: “I think I can do that move,” but then concluded he might “do it privately for Michelle,” the first lady.

PSY was in Thailand to give a free concert Wednesday night organized as a tribute to the country’s revered King Bhumibol Adulyadej, who turns 85 next month. He paid respects to the king at a Bangkok shopping mall, signing his name in an autograph book placed beside a giant poster of the king. He then gave an outdoor press conference, as screaming fans nearby performed the pop star’s dance.

Determined not to be a one-hit wonder, PSY said he plans to release a worldwide album in March with dance moves that he thinks his international fans will like.

“I think I have plenty of dance moves left,” he said, in his trademark sunglasses and dark suit. “But I’m really concerned about the (next) music video.”

“How can I beat ‘Gangnam Style’?” he asked, smiling. “How can I beat 850 million views?”

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Associated Press writer Thanyarat Doksone contributed to this report.

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“Anger Management,” “Justified” return dates set by FX

LOS ANGELES (TheWrap.com) – FX released its early 2013 premiere schedule Wednesday, including dates for the second season of Charlie Sheen‘s sitcom “Anger Management” and the fourth season of the Timothy Olyphant lawman drama “Justified.”

The premiere schedule kicks off with “Justified” on Tuesday, January 8 at 10 p.m. The season will find Olyphant’s character, U.S. Deputy Marshall Raylan Givens, picking up a 30-year-old cold case, unraveling a riddle that echoes all the way back to his boyhood and his criminal father’s bad dealings.

The premieres go into high gear on January 17, with the return of “Anger Management,” “Archer” and “Totally Biased W. Kamau Bell,” as well as the series premiere of the new offering “Legit.”

“Anger Management,” which received a 90-episode order after the success of its first season, will premiere with consecutive episodes at 9 and 9:30 p.m., with the animated series “Archer” premiering its fourth season at 10 p.m.

The new series “Legit,” which stars Jim Jeffries as a foul-mouthed Australian comedian struggling to legitimize his life and career in Los Angeles, will begin its 13-episode maiden season at 10 p.m., while “Totally Biased W. Kamau Bell,” which features comedian Bell riffing on politics, culture and other topics, will start a new cycle of episodes at 11 p.m.

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Some 20 percent of women overwhelmed by cancer treatment options: study

(Reuters) – More than one in five women with early-stage breast cancer said they were given too much responsibility for treatment-related decisions – and those patients were more likely to end up regretting the choices they made, according to a U.S. study.

The findings, which appeared in the Journal of General Internal Medicine, don’t mean that women should not be fully informed about their treatment options, researchers said, but rather that doctors may need to find new strategies to communicate with patients, especially the less educated.

“Some women may feel overwhelmed or burdened by treatment choices, particularly if they are not also given the tools to understand and weigh the benefits and harms of these choices,” wrote research leader Jennifer Livaudais and colleagues.

Her team from the Mount Sinai School of Medicine in New York surveyed 368 women who had just had surgery for early-stage breast cancer at one of eight New York City hospitals, and again six months later.

The majority said they typically had trouble understanding medical information and less than one-third knew the possible benefits of surgery, radiation and chemotherapy, Livaudais and her colleagues found.

Lack of both “health literacy” and knowledge about treatment benefits was common among the 21 percent of women who said they had too much responsibility for decision-making – as well as among the seven percent who felt they didn’t have enough responsibility.

Women who were poor, non-white or didn’t finish high school were also more likely to feel that they had either too much or too little say in their treatment.

Close to two-thirds of women on both ends of the spectrum had some regret about their original treatment decisions six months down the line. That compared to one-third of women who originally said they had a “reasonable amount” of decision-making responsibility.

Steven Katz, who has studied cancer-related decision-making at the University of Michigan in Ann Arbor, said that compared to past years, doctors now have better ways to tailor treatment to individual patients. But that also means treatment options are based on more convoluted information.

“The treatments are linked in complicated ways, and the information that doctors draw on to make recommendations has increasingly become more and more complex” said Katz, who wasn’t involved in the new study.

He said that for patients trying to make the best treatment choices, the smartest thing they can do is have a team of doctors – an experienced surgeon, a medical oncologist, a radiation oncologist and a plastic surgeon – all working on their case and sharing ideas.

“The purpose (of the study) was not to say women shouldn’t be provided with these treatment options, but that the information really needs to be tailored better,” said Livaudais, who is now at the University of California, San Francisco.

She recommended that doctors ask each patient how much responsibility she feels comfortable taking.

“Some patients prefer… for the information to be presented in simpler terms, or for the physician to recommend something to them,” she added. SOURCE: http://bit.ly/11d6IIW

(Reporting from New York by Genevra Pittman at Reuters Health; editing by Elaine Lies)

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Buying That First Home Is Getting Harder

The housing market may be recovering, but not everyone’s along for the ride. First-time buyers are becoming a shrinking share of purchasers, according to the results of a monthly survey of 2,500 real estate agents. New home buyers made just 34.7 percent of all purchases in October, the lowest since the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey started in September 2009. Three years ago, first-time borrowers were 47 percent of all buyers, buoyed at the time in part by a tax credit.

First-time homeowners, who typically buy lower-priced homes and need extra financing, are losing share as the market shifts from distressed properties such as foreclosures. Distressed sales, which usually cost less, were almost half of all of purchases a year ago, but now they’re just over a third of sales. At the same time, prices for all existing homes have been rising—prices were up 4.4 percent in September over the previous year, according to the Federal Housing Finance Agency—making homes less affordable for first-time buyers.

For new buyers, rising prices are coupled with difficulties in getting a mortgage. About half of all first-time buyers get their loans through HUD’s Federal Housing Administration, which allows down payments as low as 3.5 percent. Because loans with lower down payments are riskier, the FHA’s rates are typically higher than those of traditional mortgages. With interest rates at near-record lows, the incremental difference wasn’t causing much consternation in the past. But facing concerns that it has taken on too much risk and may need a bailout, the FHA raised rates in August and plans to do so again next year.

Interest rates are still near historic lows, rents are rising, and home prices (adjusted for inflation) are still at levels not seen in more than a decade. That means first-time buyers may be missing out on quite the opportunity, if they just can find a loan and a home they can afford.

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