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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EBay’s double tax base prompts calls for investigation

LONDON (Reuters) – Britain and Germany may have missed out on a combined $ 1 billion in sales tax since online marketplace eBay picked a tiny Luxembourg office as its base for EU sales, a shift that lawmakers say should now be investigated.

EBay’s nomination of Luxembourg unit eBay Europe Sarl – with a staff of nine – as its provider of services to EU clients allows it to charge customers in Europe a low rate of sales tax, often known as Value Added Tax, helping it to compete against rivals.

However, the unit doesn’t actually receive the money from sales. Instead, eBay said it continues to channel revenues through a Berne-based unit, allowing the company also to benefit from what Swiss tax lawyers say is the most competitive corporate income tax regime in Europe.

EU rules allow companies to establish subsidiaries in Luxembourg and levy VAT at Luxembourg’s low VAT rate on sales to customers across the bloc.

However, the rules also allow individual EU taxmen to challenge any claim to Luxembourg residence, and the right to charge Luxembourg VAT, in their domestic courts, if the taxman feels a Luxembourg-based subsidiary does not have sufficient staff or assets to support its claim to be the true supplier of goods or services.

Tax experts say eBay’s arrangement, which appears to give eBay the best of both income and sales tax worlds, could be open to challenge, and lawmakers in the UK and Germany want their taxmen to investigate.

“I hope that HMRC (UK tax authority Her Majesty’s Revenue and Customs) takes note … and takes prompt action,” said Margaret Hodge, member of parliament and chairman of the Public Accounts Committee (PAC), which monitors government finances.

“I will be seeking assurance that they are, next time we take evidence from HMRC,” she added. Officials from HMRC are due to testify to the PAC in early December as part of the committee’s investigation into tax matters.

Sven Giegold, member of the European Parliament for Germany’s Green Party, said he wanted the German tax authorities to “have a very critical look at this”.

It is common for companies to seek to reduce their tax bills, and a number of multinationals have established bases in Luxembourg so they can charge customers lower levels of VAT.

EBay said HMRC was aware of all its tax arrangements and that it was confident it met all its tax liabilities in the UK and elsewhere.

“In all countries and at all times, eBay is fully compliant with national, EU and international tax rules (including the OECD) including the remittance of VAT to the appropriate authorities,” an eBay spokesman said in an emailed statement.

The UK, German, French and Luxembourg tax authorities declined to comment on eBay, citing rules on taxpayer confidentiality.

LOWER THRESHOLD

Big companies’ tax practices have risen to the top of the political agenda in Europe in the past year, with lawmakers growing increasingly frustrated with the way in which companies such as search engine company Google pay almost no income tax in countries where they have billions of dollars in sales.

The companies escape liability for income taxes in countries like the UK by arguing the value created by their business, and therefore the location where the profit should be realized, is not the place where the customer resides, but rather in the location where the intellectual property underpinning the product or service is based.

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said this was a valid economic argument and that if, for example, HMRC wants to claim more income tax from Google, it has to prove the company is generating more value in the UK than it is declaring.

This would require a thorough deconstruction of its business model and supply chain.

However, it is easier to establish liability to VAT, since this tax hinges simply on the location of the buyer and seller.

“The threshold is lower,” said Simon Newark, head of VAT at accountants UHY Hacker.

“There are a lot more aspects for HMRC to challenge in VAT than in direct (income) tax.”

For tax purposes, the EU deems eBay’s online platform an “electronically supplied service”, a category that also covers e-Books and music downloads.

Under EU rules, suppliers of such services based within the bloc are supposed to charge EU customers VAT at the rate prevailing in the country where the supplier is based.

A number of suppliers of electronic services, including Amazon.Com Inc and Apple Inc’s iTunes have established European headquarters in Luxembourg to enable them to charge customers lower VAT rates than prevail in their customers’ countries.

Luxembourg has traditionally charged the lowest standard VAT rates in the European Union. Its 15 percent rate compares with rates of 19-25 percent in most other EU members.

By charging customers VAT at Luxembourg’s rate eBay is better able to compete with rivals based elsewhere in the EU, such as Britain’s eBid, which must charge customers VAT at the standard UK rate of 20 percent.

However, to be entitled to charge Luxembourg rates, a company has to be able to prove in British, German or EU courts that it is genuinely based in the Grand Duchy.

Companies selling to EU customers from outside the EU – as eBay was until the 2007 nomination of eBay Europe Sarl as supplier to EU clients – must charge European customers VAT at the rate prevailing in the country where the customer resides, and to pay that VAT to the taxman in the customer’s country.

There is no definitive checklist that determines the true base of a company and any decision by a national court can be challenged in the European Court of Justice. In the UK, HMRC said it approached the matter on a case-by-case basis, and disputes are often resolved in court.

“HMRC will challenge any arrangements where it is claimed that supplies are made from a particular country but the business does not have the necessary resources to make those supplies,” a spokesman said.

EUROPE EXPANSION

EBay, which is headquartered in San Jose, California, moved into Europe in 1999 when it established eBay International in Berne. Switzerland’s low income tax regime for foreign companies was highly beneficial for the auction site. “We do have a very favorable international tax structure,” then-Chief Financial Officer Rajiv Dutta told analysts in 2002 when asked how the company managed to pay such low taxes on its non-U.S. income.

The Swiss base also meant, initially, that the company didn’t have to charge EU customers VAT. But in 2003, Brussels changed the rules, which forced eBay to charge EU sellers on its platform VAT based on their residence. The VAT gathered was remitted to the tax authority in the customer’s country.

Not all customers are charged VAT. Most medium-sized and big businesses are legitimately exempted from paying VAT on some purchases, such as eBay seller fees.

EBay’s Swiss-based European public relations head declined to say what portion of its EU customers were liable to be charged VAT. James Cordwell, equities analyst at Atlantic Equities, estimated that such customers accounted for 40-50 percent of sales in Europe.

Since the 2007 creation of its Luxembourg operation, eBay has had German fee revenues of $ 6.1 billion and UK revenues of $ 5 billion, its annual accounts show.

If the services were supplied from Switzerland or another non-EU country, and assuming only half of customers should have been charged VAT, EU rules would have obliged eBay to collect $ 580 million in VAT for the German taxman and $ 500 million in VAT for HMRC since 2007.

EBay’s entitlement to charge Luxembourg VAT on sales and to pay this to the Luxembourg taxman rests on being able to prove in court that eBay Europe Sarl is the provider of services to EU clients.

But despite German and UK fee income of $ 3.1 billion last year, eBay Europe Sarl recorded turnover of only 5 million euros in 2011.

John Hemming, an MP with the Liberal Democrats, the junior partner in the British coalition government, said the fact eBay’s sales revenues did not go through the Luxembourg unit undermined the claim that it was the true provider of services to EU clients.

“If it’s a real transaction, you would expect the money to pass with it, and not pass someplace else,” he said.

Rather than going to Luxembourg, the money generated from customers continues to go to Berne-based eBay International AG, a spokeswoman said.

When Reuters visited in mid November, staff at the Luxembourg office, just opposite the central post office, declined to discuss what operations the unit conducted for eBay.

A spokesman later said the office conducted activities including billing, data privacy, contracting, regulatory, management and some customer services operations.

By contrast, Amazon and iTunes do report their sales of ebooks and music downloads to EU customers through their Luxembourg units.

Prem Sikka, professor of accounting at Essex University, along with Newark and Roy-Chowdhury said a cash trail through a unit was one of the key factors used as evidence that the unit was the true supplier of a service.

UK and German tax authorities could argue that the shift in eBay’s supply base to Luxembourg from Berne was therefore not genuine. If successful, they could claim back the VAT lost.

EBay declined to say why it channeled sales through Switzerland. Tax advisors say the country can still offer some companies lower tax rates than other European low-tax jurisdictions such as Ireland and Luxembourg.

Indeed, EBay’s closest rival Amazon, which channels about half its non-U.S. earnings through Luxembourg, reported average income tax on overseas earnings of 6 percent in the past four years. EBay paid just 3 percent over the same period.

(Additional reporting by Brenda Goh; Editing by Will Waterman)

Tech News Headlines – Yahoo! News

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Katie Holmes Plants Her Stake on Broadway - and Succeeds

By Tom Gliatto

11/30/2012 at 09:45 AM EST

Katie Holmes and Norbert Leo Butz at the curtain call of Dead Accounts on opening night

Andrew H. Walker/Getty

    

You'll want to know what sort of performance Katie Holmes gives in Theresa Rebeck's Dead Accounts, which marks the actress's second Broadway appearance and her first since she slipped out of the orbit of That Superstar Who Declared His Love by Jumping on a Sofa.

She's good.

That’s a lot, considering there's not much meat to this comedy, and that most of it has been thrown into the sizable, eager mandibles of Tony-winner Norbert Leo Butz. It's a showcase role, and he's up for it. The performance is so full of outbursts, jokes, feints and tics he could have marked every moment with Post-it notes left across the set, a middle-class kitchen in Cincinatti: Here is where he manically gobbles his way through cartons of ice cream. Here is where he falls to the floor in a (very convincing) burst of hysterical laughter. And here, here, here and here are moments in which his manic comedy seems to be shading off into something closer to a genuine breakdown.

I don't think audiences would really be ready to see Katie Holmes have to go through all that.

Butz plays Jack, a Wall Street type who has returned to – fled back to? – the family home in Ohio, bringing with him a whirlwind of confusion. Why are his pockets full of prescription pills? Where did he get those wads of money he keeps throwing on the kitchen table? Why does he keep joking that he's murdered his wife? Why, in general, does he behave like Charlie Day from It's Always Sunny in Philadelphia?

Holmes plays Jack’s unmarried, sad-sack sister, Lorna, who is helping their father (unseen offstage) through a bout of kidney stones. In the first act, the role consists mostly of moving to and from the kitchen table and filling in a lot of expositional and background details that don't seem necessary. If your brother had turned up late at night, possibly out of his mind and yammering about how Cincinnati makes the best ice cream, would you and your mother spend the next morning discussing Catholicism and whether or not Jack should go to Mass? No.

However, Holmes gets her moments in the second act: Lorna is given a simple, tender monologue about planting a tree when she was a child, followed by a full-throttle, over-the-top tirade against money, banks and fiduciary wickedness.

Holmes gets a big laugh there, but you have the nagging realization that the little memory about the tree slipped by without registering emotionally – that it was a lot more meaningful than the tirade, and that Holmes should have been directed to dig deeper. Or that Rebeck, creater of NBC’s Smash, should have written deeper.

Apart from being unhappy – and who isn't? – is Lorna pathetic, depressed, neurotic, stupid? We never know.

By this point, we've found out Jack's secret, and the puncturing of that mystery leaves us with little more than a tangle of themes messily duking it out: death, family, money, New York vs. Cincinnati and, toward and right up to the end, more and more about that symbolic tree.

Based on a rather pretty stage effect at the finale, I would say the tree wins.

I would even speculate that the play would have been better if it had actually have been about trees, about their beauty, their cycle of renewal, their longevity through time.

But then (1) Rebeck would have had to abandon her thin sitcom plot, or (2) Holmes would have had to learn to be a tree.

I doubt audiences are ready to see Holmes play a tree.

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Ukraine fights spreading HIV epidemic

BUCHA, Ukraine (AP) — Andrei Mandrykin, an inmate at Prison No. 85 outside Kiev, has HIV. He looks ghostly and much older than his 35 years. But Mandrykin is better off than tens of thousands of his countrymen, because is he receiving treatment amid what the World Health Organization says is the worst AIDS epidemic in Europe.

Ahead of World AIDS Day on Saturday, international organizations have urged the Ukrainian government to increase funding for treatment and do more to prevent HIV from spreading from high-risk groups into the mainstream population, where it is even harder to manage and control.

An estimated 230,000 Ukrainians, or about 0.8 percent of people aged 15 to 49, are living with HIV, the virus that causes AIDS. Some 120,000 are in urgent need of anti-retroviral therapy, which can greatly prolong and improve the quality of their lives. But due to a lack of funds, fewer than a quarter are receiving the drugs — one of the lowest levels in the world.

Ukraine's AIDS epidemic is still concentrated among high-risk groups such as intravenous drug users, sex workers, homosexuals and prisoners. But nearly half of new cases registered last year were traced to unprotected heterosexual contact.

"Slowly but surely the epidemic is moving from the most-at-risk, vulnerable population to the general population," said Nicolas Cantau of The Global Fund to Fight AIDS, Tuberculosis and Malaria, who manages work in Eastern Europe and Central Asia. "For the moment there is not enough treatment in Ukraine."

Stigma is also a big problem for those with HIV in Ukraine. Liliya, a 65-year-old woman who would give only her first name, recently attended a class on how to tell her 9-year-old great-granddaughter that she has HIV. The girl, who contacted HIV at birth from her drug-abusing mother, has been denied a place in preschool because of her diagnosis.

"People are like wolves, they don't understand," said Liliya. "If any of the parents found out, they would eat the child alive."

While the AIDS epidemic has plateaued elsewhere in the world, it is still progressing in Eastern Europe and Central Asia, according to Cantau. Nearly 21,200 new cases were reported in Ukraine in 2011, the highest number since the former Soviet republic registered its first case in 1987, and a 3 percent increase over 2010. As a result of limited and often delayed treatment, the number of AIDS-related deaths grew 17 percent last year to about 3,800.

Two years ago, Mandrykin, the prisoner, was on the verge of becoming part of that statistic, with his level of crucial CD4 immune cells — a way to measure the strength of the immune system — dropping to 11. In a healthy person, the CD4 count is usually over 600.

"I was lying in the hospital, I was dying," said Mandrykin, who is serving seven years for robbery, his fourth stint in jail. "It's a scary disease."

After two years of treatment in a small prison clinic, his CD4 count has risen to 159 and he feels much better, although he looks exhausted and is still too weak to work in the workshop of the medium-security prison.

The Ukrainian government currently focuses on testing and treating standard cases among the general population. The anti-retroviral treatment of more than 1,000 inmates, as well as some 10,000 HIV patients across Ukraine who also require treatment for tuberculosis and other complications and all prevention and support activities, are paid for by foreign donors, mainly the Global Fund.

The Global Fund is committed to spending $640 million through 2016 to fight AIDS and tuberculosis in Ukraine and then hopes to hand over most of its programs to the Ukrainian government.

Advocacy groups charge that corruption and indifference by government officials help fuel the epidemic.

During the past two years, Ukrainian authorities have seized vital AIDS drugs at the border due to technicalities, sent prosecutors to investigate AIDS support groups sponsored by the Global Fund and harassed patients on methadone substitution therapy, prompting the Global Fund to threaten to freeze its prevention grant.

Most recently, Ukraine's parliament gave initial approval to a bill that would impose jail terms of up to five years for any positive public depiction of homosexuality. Western organizations say it would make the work of AIDS prevention organizations that distribute condoms and teach safe homosexual sex illegal and further fuel the epidemic. It is unclear when the bill will come up for a final vote.

AIDS drug procurement is another headache, with Ukrainian health authorities greatly overpaying for AIDS drugs. Advocacy groups accuse health officials of embezzling funds by purchasing drugs at inflated prices and then pocketing kickbacks.

Officials deny those allegations, saying their tender procedures are transparent.

Much also remains to be done in Ukraine to educate people about AIDS.

Oksana Golubova, a 40-year-old former drug user, infected her daughter, now 8, with HIV and lost her first husband to AIDS. But she still has unprotected sex with her new husband, saying his health is in God's hands.

"Those who are afraid get infected," Golubova said.

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Wall Street opens flat, Obama to speak on "cliff"

NEW YORK (Reuters) - Wall Street opened flat on Friday, amid caution ahead of a statement from President Obama on the progress of budget talks in Washington that have fueled volatility and nervousness in the financial markets.

The Dow Jones industrial average <.dji> gained 5.45 points, or 0.04 percent, to 13,027.27. The Standard & Poor's 500 Index <.spx> dropped 0.51 points, or 0.04 percent, to 1,415.44. The Nasdaq Composite Index <.ixic> gained 0.07 points, or 0.00 percent, to 3,012.10.

(Reporting by Edward Krudy; Editing by Bernadette Baum)

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General Assembly Grants Palestine Upgraded Status in U.N.

Damon Winter/The New York Times

The Palestinian Authority president, Mahmoud Abbas, center, was congratulated by Turkey’s foreign minister, Ahmet Davutoglu. More Photos »

UNITED NATIONS — More than 130 countries voted on Thursday to upgrade Palestine to a nonmember observer state of the United Nations, a triumph for Palestinian diplomacy and a sharp rebuke to the United States and Israel.

But the vote, at least for now, did little to bring either the Palestinians or the Israelis closer to the goal they claim to seek: two states living side by side, or increased Palestinian unity. Israel and the militant group Hamas both responded critically to the day’s events, though for different reasons.

The new status will give the Palestinians more tools to challenge Israel in international legal forums for its occupation activities in the West Bank, including settlement-building, and it helped bolster the Palestinian Authority, weakened after eight days of battle between its rival Hamas and Israel.

But even as a small but determined crowd of 2,000 celebrated in central Ramallah in the West Bank, waving flags and dancing, there was an underlying sense of concerned resignation.

“I hope this is good,” said Munir Shafie, 36, an electrical engineer who was there. “But how are we going to benefit?”

Still, the General Assembly vote — 138 countries in favor, 9 opposed and 41 abstaining — showed impressive backing for the Palestinians at a difficult time. It was taken on the 65th anniversary of the vote to divide the former British mandate of Palestine into two states, one Jewish and one Arab, a vote Israel considers the international seal of approval for its birth.

The past two years of Arab uprisings have marginalized the Palestinian cause to some extent as nations that focused their political aspirations on the Palestinian struggle have turned inward. The vote on Thursday, coming so soon after the Gaza fighting, put the Palestinians again — if briefly, perhaps — at the center of international discussion.

“The question is, where do we go from here and what does it mean?” Salam Fayyad, the Palestinian prime minister, who was in New York for the vote, said in an interview. “The sooner the tough rhetoric of this can subside and the more this is viewed as a logical consequence of many years of failure to move the process forward, the better.” He said nothing would change without deep American involvement.

President Mahmoud Abbas of the Palestinian Authority, speaking to the assembly’s member nations, said, “The General Assembly is called upon today to issue a birth certificate of the reality of the state of Palestine,” and he condemned what he called Israeli racism and colonialism. His remarks seemed aimed in part at Israel and in part at Hamas. But both quickly attacked him for the parts they found offensive.

“The world watched a defamatory and venomous speech that was full of mendacious propaganda against the Israel Defense Forces and the citizens of Israel,” Prime Minister Benjamin Netanyahu of Israel responded. “Someone who wants peace does not talk in such a manner.”

While Hamas had officially backed the United Nations bid of Mr. Abbas, it quickly criticized his speech because the group does not recognize Israel.

“There are controversial issues in the points that Abbas raised, and Hamas has the right to preserve its position over them,” said Salah al-Bardaweel, a spokesman for Hamas in Gaza, on Thursday.

“We do not recognize Israel, nor the partition of Palestine, and Israel has no right in Palestine,” he added. “Getting our membership in the U.N. bodies is our natural right, but without giving up any inch of Palestine’s soil.”

Israel’s ambassador to the United Nations, Ron Prosor, spoke after Mr. Abbas and said he was concerned that the Palestinian Authority failed to recognize Israel for what it is.

“Three months ago, Israel’s prime minister stood in this very hall and extended his hand in peace to President Abbas,” Mr. Prosor said. “He reiterated that his goal was to create a solution of two states for two peoples, where a demilitarized Palestinian state will recognize Israel as a Jewish state.

“That’s right. Two states for two peoples. In fact, President Abbas, I did not hear you use the phrase ‘two states for two peoples’ this afternoon. In fact, I have never heard you say the phrase ‘two states for two peoples’ because the Palestinian leadership has never recognized that Israel is the nation-state of the Jewish people.”

The Israelis also say that the fact that Mr. Abbas is not welcome in Gaza, the Palestinian coastal enclave run by Hamas, from which he was ejected five years ago, shows that there is no viable Palestinian leadership living up to its obligations now.

Jennifer Steinhauer contributed reporting from Washington, Isabel Kershner from Jerusalem, and Khaled Abu Aker from Ramallah, West Bank.

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RIM stock rises after Goldman Sachs upgrade

TORONTO (AP) — Research In Motion rose Thursday after Goldman Sachs upgraded the phone maker’s shares, saying there’s a “30 percent chance” RIM‘s much-delayed BlackBerry 10 smartphones will be a success.

THE SPARK: Goldman Sachs analyst Simona Jankowski lifted RIM to “Buy” from “Neutral,” the latest analyst to voice a slightly more optimistic view for the troubled company. Goldman lifted its 12-month price target to $ 16 from $ 9.

THE BIG PICTURE: RIM was once Canada’s most valuable company, with a market value of more than $ 80 billion in 2008, but shares have sunk due to ground lost to Apple Inc.‘s iPhone and phones running Google Inc.‘s Android system.

Now the company’s new BlackBerrys, expected sometime after Jan. 30, are considered critical to its survival. The new system includes a touch screen and the apps experience that customers now expect.

THE ANALYSIS: Jankowski noted positive early reviews for the new operating system and broad-based support by carriers who are looking to sell a third operating system beyond Google’s Android and Apple’s iOS.

She predicted that RIM will become profitable in the year ending in February 2014. Analysts polled by FactSet expect a loss. Still, she expects RIM to revert to a loss the next year.

Last week, National Bank Financial Kris Thompson increased his price target to $ 15 from $ 12, while Jefferies analyst Peter Misek doubled his price target from $ 5 to $ 10, saying the BlackBerry 10 operating system has a 20 to 30 percent chance of succeeding.

SHARE ACTION: Shares of Research In Motion added 67 cents, or 6.4 percent, to $ 11.77 in midday trading on the Nasdaq. The stock is up 78 percent since late September — but it’s down 23 percent this year through Wednesday’s close, and has lost more than 90 percent from its 2008 high.

Gadgets News Headlines – Yahoo! News

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Jude Law: I'm Okay Not Being 'That Young Pretty Thing' Anymore

Stylewatch
Style News Now

11/29/2012 at 09:15 AM ET

Courtesy T, The New York Times Style Magazine

While most people dread getting older, Jude Law is actually thrilled about it. And not for any reason you’d expect.

“In a weird way, it’s kind of a relief to think, ‘Oh, I know I’m not that young sort of pretty thing anymore,’” Law tells T, The New York Times Style Magazine. And at 39 years old, the actor admits he’d much rather reflect on his heartthrob days than relive them. “It’s quite nice talking about what it was like to be the young pretty thing, rather than being it.”

And though Law might not consider himself pretty anymore, he was still a bit too good looking for his role in Anna Karenina, in which he plays Anna’s older controlling husband (below). The director, Joe Wright, reveals in the T Magazine cover story, “I had to stop him [from] doing his ‘handsome face.’”

Another part of himself that Law had to change? His hair. Law’s character is almost bald. And while some actors would choose to wear a bald cap and wig, Law embraced the look. “[I was] surprised when he chose to actually cut his hair that way and not just wear a wig,” his co-star Keira Knightley admits in the feature.

To read more of Law’s cover story, pick up T, The New York Times Style Magazine Holiday 2012 edition, available this weekend, or click over to nytimes.com. Tell us: Do you prefer Law now or back in his heartthrob days (think 1997′s Gattaca)?

Laurie Sparham/Focus Features

–Jennifer Cress

PHOTOS: FEAST YOUR EYES ON MORE GOOD-LOOKING GUYS!

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Simple measures cut infections caught in hospitals

CHICAGO (AP) — Preventing surgery-linked infections is a major concern for hospitals and it turns out some simple measures can make a big difference.

A project at seven big hospitals reduced infections after colorectal surgeries by nearly one-third. It prevented an estimated 135 infections, saving almost $4 million, the Joint Commission hospital regulating group and the American College of Surgeons announced Wednesday. The two groups directed the 2 1/2-year project.

Solutions included having patients shower with special germ-fighting soap before surgery, and having surgery teams change gowns, gloves and instruments during operations to prevent spreading germs picked up during the procedures.

Some hospitals used special wound-protecting devices on surgery openings to keep intestine germs from reaching the skin.

The average rate of infections linked with colorectal operations at the seven hospitals dropped from about 16 percent of patients during a 10-month phase when hospitals started adopting changes to almost 11 percent once all the changes had been made.

Hospital stays for patients who got infections dropped from an average of 15 days to 13 days, which helped cut costs.

"The improvements translate into safer patient care," said Dr. Mark Chassin, president of the Joint Commission. "Now it's our job to spread these effective interventions to all hospitals."

Almost 2 million health care-related infections occur each year nationwide; more than 90,000 of these are fatal.

Besides wanting to keep patients healthy, hospitals have a monetary incentive to prevent these infections. Medicare cuts payments to hospitals that have lots of certain health care-related infections, and those cuts are expected to increase under the new health care law.

The project involved surgeries for cancer and other colorectal problems. Infections linked with colorectal surgery are particularly common because intestinal tract bacteria are so abundant.

To succeed at reducing infection rates requires hospitals to commit to changing habits, "to really look in the mirror and identify these things," said Dr. Clifford Ko of the American College of Surgeons.

The hospitals involved were Cedars-Sinai Medical Center in Los Angeles; Cleveland Clinic in Ohio; Mayo Clinic-Rochester Methodist Hospital in Rochester, Minn.; North Shore-Long Island Jewish Health System in Great Neck, NY; Northwestern Memorial Hospital in Chicago; OSF Saint Francis Medical Center in Peoria, Ill.; and Stanford Hospital & Clinics in Palo Alto, Calif.

___

Online:

Joint Commission: http://www.jointcommission.org

American College of Surgeons: http://www.facs.org

___

AP Medical Writer Lindsey Tanner can be reached at http://www.twitter.com/LindseyTanner

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Wall Street climbs on optimism over fiscal deal

NEW YORK (Reuters) - U.S. stocks rose in early trading on Thursday on optimism that Congress was progressing toward a fiscal agreement in Washington that would avert a possible recession.

Market participants are focused on discussions in Congress over avoiding big spending cuts and tax hikes, known as the "fiscal cliff," beginning in January. Still, equities may retreat, as they did Tuesday, if the upbeat negotiation environment in Washington deteriorates.

"There will be a deal before December 31 to avert the economy facing disaster," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

"We're back on track for a year-end rally to continue," he said.

The yield on Italy's 10-year bonds fell to the lowest in two years at an auction, amid relief that immediate risks over Greece had diminished.

"The fact that the bond sales in Europe went well suggest confidence is beginning to reenter some of the peripheral nations and that is a good sign," Cardillo said.

The euro briefly touched the $1.30 level and is near its highs for November, boosting commodity prices. The S&P materials sector index <.gspm> led gains with a 0.8 percent advance.

The Dow Jones industrial average <.dji> rose 50.15 points, or 0.39 percent, to 13,035.26. The S&P 500 <.spx> gained 7.07 points, or 0.50 percent, to 1,417.00. The Nasdaq Composite <.ixic> added 20.21 points, or 0.68 percent, to 3,011.99.

Equity markets may also be supported by data showing the U.S. economy grew faster than first reported between July and September. Separate data showed the number of Americans filing new claims for unemployment benefits dropped for a second week, and a larger-than-expected 3.3 percent advance in third-quarter corporate profits.

Due for release later Thursday are pending home sales for October, at 10:00 a.m. (1500 GMT), and the Federal Reserve Bank of Kansas City November manufacturing survey at 11:00 a.m.

Kroger , the biggest U.S. supermarket operator, added 3.3 percent to $25.89 after reporting earnings.

Tiffany shares slumped 7.9 percent to $58.72 after the upscale jeweler reported quarterly results and cut its full-year sales and profit forecasts.

Top retailers said weak sales in early November, after superstorm Sandy, were a drag on the month. Target fell 2 percent and Kohl's Corp dropped 10.3 percent.

U.S.-listed shares of BlackBerry maker Research In Motion surged 8.5 percent to $12.06 after Goldman Sachs upgraded the stock to "buy" from "neutral."

(Editing by Bernadette Baum)

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