Mediocre job growth points to slow grind for U.S. economy


WASHINGTON (Reuters) - The pace of U.S. job growth slowed a bit in December, keeping the unemployment rate steady at 7.8 percent, but details of the Labor Department's U.S. employment report were fairly encouraging.


* Nonfarm payrolls increased 155,000, but job gains for the previous month were revised up to show 15,0000 more positions created than previously reported.


* Construction employment rebounded strongly, gaining 30,000 jobs after sagging 10,000 in November, reflecting increased residential construction activity as the housing market recovery gains traction.


* Manufacturing payrolls gained 25,000 after rising 5,000 in November. Manufacturing working hours increased, a positive sign for a sector that has been cooling in recent months. That helped to lift the overall average workweek to 34.5 hours from 34.4 hours in November.


* With workers putting in more time, the average hourly earnings increased 0.3 percent after rising by the same margin in November.


* More people entered the labor force, a sign of confidence in the jobs market, keeping the unemployment rate elevated. The household survey also showed a modest increase in employment, but more people reported they did not have jobs.


* The bad news is that government shed 13,000 jobs in December after a loss of 10,000 the prior month.


* Temporary help jobs, often seen as a harbinger for permanent hiring, fell in December and retail employment declined by 11,300 jobs after a hiring spree the previous months.


(Reporting By Lucia Mutikani)



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News Analysis: Debt Deal Fails to Allay Fears on U.S. Global Power





WASHINGTON — Two years ago the departing chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, declared that “the most significant threat to our national security is our debt.” After a decade in which the nation had chased Al Qaeda and invaded Iraq, Admiral Mullen was saying, in essence, that the biggest enemy was us.







Paula Bronstein/Getty Images

Some analysts worry that the United States will not maintain influence in places like Myanmar.







Now that Congress and President Obama have slipped past the latest budget deadline with a bill that does little to address the country’s long-term debt issues — and by some measures might worsen them — the worries of the national security establishment have been reignited. Most pointedly, military and diplomatic experts wonder whether the United States is at risk of squandering its global influence.


“There’s a sense that we’ve been playing roulette with our position, and this deal does nothing to stop that,” Richard N. Haass, the president of Council on Foreign Relations, said in an interview. His coming book, “Foreign Policy Begins at Home,” is part of a wave of recent literature arguing that America’s reduced global ambitions are linked to its status as a debtor nation.


Vali Nasr, who will soon publish “The Dispensable Nation,” argues that the debt, among other economic woes, has allowed Mr. Obama and other Democrats to justify a retreat from global engagement. “It’s made it far easier to say ‘We can’t do more,’ ” said Mr. Nasr, the dean of the School of Advanced International Studies at Johns Hopkins University. “And without addressing the debt issues, it will be easier to make that argument for years to come.”


A departing senior diplomat at the State Department who requested anonymity, ruminating on the outcome of the confrontation on the fiscal crisis, said that the failure to attack the long-term debt issues would become another reason “to turn our backs on the Middle East and trim our sails on the new focus on Asia.”


That is the theme that the Chinese — who have an interest in portraying the United States as a declining power unable to manage its economy — are already promoting. “The politicians have chosen to kick the can down the road,” the state-run Xinhua news agency said in a commentary on Wednesday. “The can will never disappear,” it continued, warning that the United States was falling “into an abyss you can never come out of.”


Most evidence suggests that the country’s debt is not an immediate crisis. The deficit is expected to shrink somewhat in coming years, and even after the United States lost its AAA bond rating, foreigners have remained willing to lend the country money at very low interest rates. That is a sign of confidence in the American economy and a recognition that Europe and Asia have problems of their own.


But the aging of the population and the growth of health costs will most likely cause the deficit to grow rapidly in coming decades, meaning that the most difficult choices about taxes and spending are still ahead. Absent decisions on those issues, the government will have fewer resources and be more dependent on foreign lenders — increasingly the Chinese.


“Partly it is about resources,” Mr. Haass said, referring to the national security implications of the deficit. “But it is also about reducing your vulnerability to the machinations of currency markets and potentially hostile central bankers” who choose whether to buy American debt.


“When we appear to be dysfunctional, as we have in recent times, it makes it hard to be the model for the democratic, capitalistic model we say we want to be in the world,” he added.


History suggests that the relationship between debt and American power is a complex one, subject to differing interpretations by both economists and historians. The federal debt exceeded 100 percent of the gross domestic product at the end of World War II, but the postwar period nonetheless marked the beginning of America’s superpower status. The debt fell fairly steadily during the cold war, and it was cut to about a third of gross domestic product by the end of the Nixon administration — even as the country retreated into a post-Vietnam War funk.


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This Is Anderson Cooper with Bird Poop on His Face






We realize there’s only so much time one can spend in a day watching new trailers, viral video clips, and shaky cell phone footage of people arguing on live television. This is why every day The Atlantic Wire highlights the videos that truly earn your five minutes (or less) of attention. Today:  


RELATED: Yes, Someone Turned Their Dead Cat Into a Helicopter






We have some terrible news for you today: Anderson Cooper has imperfections. Weird, right? We always thought Cooper was Elvish or some otherworldly being created for the tears of stars and moonbeams, but, guys, he’s totally human. And he has under-eye bags and he’s totally unafraid to smear bird feces on them to make them go away. This is a bad sign for regular humans with regular, un-Cooper-like people problems:


RELATED: ‘Morgan Freeman’ Reads ’50 Shades’; The Science of Orgasms


RELATED: Stephenie Meyer’s Dreams Are Worth $ 750 Million Per Hour


This video will make you wish adopting parents was a thing:


RELATED: Stop-Motion Guacamole Making; Robots Will Replace Our Caricaturists


RELATED: Your Brain on Love; Whit Stillman Waited 14 Years to Make a Movie About College


This one will make you wish the same thing about grandparents: 


Rule No. 32928 of the world: Fireworks are totally awesome and spectacular and are even more awesome and spectacular in reverse. 


And finally, here are some facts that will blow your mind … or, more likely, elicit weird looks at that cocktail party you were invited to:


Wireless News Headlines – Yahoo! News





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George Lucas Engaged to Mellody Hobson















01/03/2013 at 07:35 PM EST







George Lucas and Mellody Hobson


Mike Coppola/Getty


George Lucas is following the Force – right down the aisle.

The Star Wars director, 68, is engaged to DreamWorks animation chairman Mellody Hobson, a rep for Lucasfilm confirmed to The Hollywood Reporter on Thursday.

Hobson, 43, has been dating Lucas since 2006. This will be her first marriage and Lucas's second; he previously was married to film editor Marcia Lou Griffin. The exes adopted a daughter Amanda before their 1983 divorce. Lucas went on to adopt two more children.

Lucas's fiancée is also a contributor to Good Morning America's financial segments and has received many honors, including a 2002 listing as one of Esquire's "Best and Brightest" in America.

Lucas has made headlines of his own, recently donating to an education foundation much of the $4 billion from his sale of Lucasfilm to Disney.

According to THR, Lucas said at the time, "As I start a new chapter in my life, it is gratifying that I have the opportunity to devote more time and resources to philanthropy."

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Indian court to rule on generic drug industry


NEW DELHI (AP) — From Africa's crowded AIDS clinics to the malarial jungles of Southeast Asia, the lives of millions of ill people in the developing world are hanging in the balance ahead of a legal ruling that will determine whether India's drug companies can continue to provide cheap versions of many life-saving medicines.


The case — involving Swiss drug maker Novartis AG's cancer drug Glivec — pits aid groups that argue India plays a vital role as the pharmacy to the poor against drug companies that insist they need strong patents to make drug development profitable. A ruling by India's Supreme Court is expected in early 2013.


"The implications of this case reach far beyond India, and far beyond this particular cancer drug," said Leena Menghaney, from the aid group Doctors Without Borders. "Across the world, there is a heavy dependence on India to supply affordable versions of expensive patented medicines."


With no costs for developing new drugs or conducting expensive trials, India's $26 billion generics industry is able to sell medicine for as little as one-tenth the price of the companies that developed them, making India the second-largest source of medicines distributed by UNICEF in its global programs.


Indian pharmaceutical companies such as Cipla, Cadila Laboratories and Lupin have emerged over the past decade as major sources of generic cancer, malaria, tuberculosis and AIDS drugs for poor countries that can't afford to pay Western prices.


The 6-year-old case that just wrapped up in the Supreme Court revolves around a legal provision in India's 2005 patent law that is aimed at preventing companies from getting fresh patents for making only minor changes to existing medicines — a practice known as "evergreening."


Novartis' argued that a new version of Glivec — marketed in the U.S. as Gleevec — was a significant change from the earlier version because it was more easily absorbed by the body.


India's Patent Controller turned down the application, saying the change was an obvious development, and the new medicine was not sufficiently distinct from the earlier version to warrant a patent extension.


Patient advocacy groups hailed the decision as a blow to "evergreening."


But Western companies argued that India's generic manufacturers were cutting the incentive for major drug makers to invest in research and innovation if they were not going to be able to reap the exclusive profits that patents bring.


"This case is about safeguarding incentives for better medicines so that patients' needs will be met in the future," says Eric Althoff, a Novartis spokesman.


International drug companies have accused India of disregarding intellectual property rights, and have pushed for stronger patent protection that would weaken India's generics industry.


Earlier this year, an Indian manufacturer was allowed to produce a far cheaper version of the kidney and liver cancer treatment sorefinib, manufactured by Bayer Corp.


Bayer was selling the drug for about $5,600 a month. Natco, the Indian company, said its generic version would cost $175 a month, less than 1/30th as much. Natco was ordered to pay 6 percent in royalties to Bayer.


Novartis says the outcome of the new case will not affect the availability of generic versions of Glivec because it is covered by a grandfather clause in India's patent law. Only the more easily absorbed drug would be affected, Althoff said, adding that its own generic business, Sandoz, produces cheap versions of its drugs for millions across the globe.


Public health activists say the question goes beyond Glivec to whether drug companies should get special protection for minor tweaks to medicines that others could easily have uncovered.


"We're looking to the Supreme Court to tell Novartis it won't open the floodgates and allow abusive patenting practices," said Eldred Tellis, of the Sankalp Rehabilitation Centre, a private group working with HIV patients.


The court's decision is expected to be a landmark that will influence future drug accessibility and price across the developing world.


"We're already paying very high prices for some of the new drugs that are patented in India," said Petros Isaakidis, an epidemiologist with Doctors Without Borders. "If Novartis' wins, even older medicines could be subject to patenting again, and it will become much more difficult for us in future to provide medicines to our patients being treated for HIV, hepatitis and drug resistant TB."


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Global shares, oil slip on Fed stimulus nerves

LONDON (Reuters) - World shares edged lower and the dollar rose before U.S. jobs data on Friday which investors will watch even more closely than usual after Fed officials raised concerns about possible side effects of its stimulus program.


Minutes from the Federal Reserve's December policy meeting unsettled financial markets on Thursday after they showed some policymakers were worried about the program's longer-term impact.


Fed bond-buying has underpinned appetite for risk and the comments reopened debate on how much longer the central bank will keep stimulating the U.S. economy, unnerving investors before the U.S. employment figures.


European shares echoed their Asian peers to edge lower. But following a sharp jump on Wednesday after the United States edged back from the "fiscal cliff" budget crisis, they were on track for weekly gains of almost 2.7 percent.


Tentative signs that the euro zone economy may have passed the worst of its downturn also helped to restrict the moves.


Markit's Euro zone Composite PMI, which gauges business activity across thousands of the region's companies, rose in December to 47.2 from 46.5 in November - below the 50 line which divides growth from contraction but at its highest level since March last year.


"The surveys at least bring some substance to the belief that the worst is over and that a return to growth is in sight for the region in 2013," said Chris Williamson, chief economist at Markit.


London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> were down 0.1-0.5 percent by mid-morning, while the MSCI index of world shares was just over 0.2 percent lower at 345.85.


Wall Street was expected to open slightly higher though, with S&P 500 futures up 0.1 percent and contracts for the Dow Jones and the Nasdaq 100 up 0.2 percent.


U.S. stocks will largely depend on the non-farm payrolls report due at 8:30 a.m. ET and any clues it gives on the health of the U.S. and global economies.


Analysts polled by Reuters expect a 150,000 rise in jobs, with unemployment holding steady at 7.7 percent. However, after a better-than-expected ADP employment report on Thursday, many may now be betting on an above-consensus jobs number.


"The Fed has made it clear that it will keep policy loose until unemployment drops to 6.5 percent or below, so strong jobs data will undoubtedly raise expectations of a more hawkish Fed," analysts at Tradition brokerage said in a note.


CORE WEAKNESS


The Fed's concerns about the longer-term impact of its policies gave fresh momentum to the recent slide by low-risk bonds including U.S. and German debt.


Bund futures slipped almost half a point to 143.12, having already fallen steeply from last week's close of 145.64.


Benchmark U.S. Treasury yields continued their climb, hitting an eight-month high of 1.96 percent, while in Asia, 10-year Japanese government bond yields touched a 3-1/2-month high of 0.83 percent.


In the currency market, the dollar hit its highest level against the yen since July 2010 at 87.835 while the euro fell to a three-week low of $1.3006. The dollar <.dxy> also touched a six-week high against a basket of currencies.


"We have seen quite a broad-based dollar rally after the minutes which has ignited a fresh debate about how much liquidity the Fed is going to pump into the economy," said Daragh Maher, FX strategist at HSBC.


The yen has fallen in recent weeks as investors bet the new government will push the Bank of Japan to weaken the currency by implementing aggressive economic stimulus.


"Breaking through 88 in dollar/yen is a significant move. It was a target for a number of people in the market and the question is now whether we have a mindset of taking profit or we look to extend," added Maher.


The dollar's recent climb makes dollar-based assets more expensive for non-dollar investors and this hit precious metals and oil.


Brent crude shed 0.6 percent to $111.47 a barrel while gold fell 1 percent to $1,645, dragging silver down more than 2 percent to $29.48.


(Additional reporting by William James and Anooja Debnath; editing by David Stamp)



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Letter from Europe: Ghetto Survivors Fight for Recognition and Pensions







BERLIN — Uri Chanoch has a gift for plain speaking, which brought a welcome reprieve during a highly technical and legalistic meeting of the German Parliament’s labor and social affairs committee last month.




The federal lawmakers had invited pension experts, lawyers, historians and Holocaust survivors to discuss one of the chapters of World War II that Germany has yet to close: how to pay pensions to Jews who worked voluntarily in the ghettos.


That may seem a strange topic to be discussing so long after 1945. The German government has already compensated Jews who were forced to work in the ghettos. But until 2002, there was no payment system for Jews who chose to work.


“We wanted to work. It meant surviving,” Mr. Chanoch, 84, a board member of the Center of Organizations of Holocaust Survivors in Israel, told the committee.


As a young boy, Mr. Chanoch worked in the ghetto of Kaunas, Lithuania, after the city’s thriving community of 40,000 Jews was rounded up in August 1941. “We got paid for our work. We also paid into the insurance funds,” he said in an interview. “That money is our money.”


Mr. Chanoch was later deported to the Stutthof concentration camp in Poland and then to Dachau. His grandparents, parents and sister were killed in Auschwitz and Stutthof.


“For me and every other ghetto survivor, recognition for the work we did in the ghetto would mean that this aspect of history has also finally been acknowledged and will be taken into account in both compensation and social legislation,” Mr. Chanoch told the committee.


In 2002, the Bundestag, or German Parliament, retroactively passed a law: “German Pensions for Work in the Ghettos.” The Federal Social Court, which is responsible for insurance claims, ruled in 1997 that work carried out in the ghettos could be recognized as employment time under German pension laws.


At the time, the government believed the payments would not be exorbitant. It estimated that about 700 of the ghetto workers would apply for pensions. This was despite the fact that there had been more than 1,150 ghettos, according to Stephan Lehnstaedt, a historian at the German Historical Institute in Warsaw who participated in the committee hearing. The Warsaw ghetto alone held more than half a million Jews.


Once the 2002 law was enacted, 70,000 survivors applied to receive pensions. The pension insurance funds were taken aback because of the costs involved. After assessments, they rejected more than 90 percent of the applications.


The pension insurance funds argued that those who had worked in the ghettos were forced laborers. They were therefore entitled to compensation to be paid by the Finance Ministry, not from the public pension fund.


As for boys barely in their teens, like Mr. Chanoch, they were considered too young to have held proper jobs. “The pension fund experts did not understand the historical conditions of life in the ghetto,” Mr. Lehnstaedt said at the committee hearing.


In 2009, after criticism by Israel and Jewish organizations over the rejection of so many claimants, the German Federal Social Court relaxed the restrictive measures. Rejected cases were reconsidered.


But the court’s ruling did not end the matter. The National Pension Board announced that payments under review would be backdated by four years, the statutory limit, to 2005. Germany’s Federal Social Court backed that position.


In the meantime, thousands of elderly claimants had died, according to the Conference on Jewish Material Claims Against Germany, or Claims Conference. The conference represents world Jewry in negotiating compensation and restitution for victims of Nazi persecution and their heirs.


Jan-Robert von Renesse, one of the German judges who attended the committee hearing, said it was shameful how the pension funds and courts had acted.


“What has been established is that in dealing with the ghetto pension issue, the National Pension Fund misjudged both real and legal conditions of the ghetto — culpably,” he said.


Even after the hearing last month, nothing was decided. The opposition Social Democrats, Green and Left parties said they wanted payments to be backdated to 1997. Chancellor Angela Merkel’s government coalition is more cautious, fearing new legal entanglements and lawsuits. All acknowledged, however, that somehow this ignominious chapter of German history needs to be closed.


On his return to Israel after the hearing, Mr. Chanoch was cautiously optimistic that some compromise could be found.


“All I ask,” he said, “is that we get old gracefully.”


Judy Dempsey is Editor in Chief, Strategic Europe for Carnegie Europe. (www.carnegieeurope.eu)


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Jennie Garth Wants to Date a Man with 'Positive Energy'















01/02/2013 at 07:10 PM EST



When it comes to her current love life, Jennie Garth has a new mantra.

"I'm learning to date again," the actress, who split from husband Peter Facinelli in March 2012, tells Health in its January issue, "[and] looks aren't important to me anymore. ... I like positive energy."

The actress, who dropped 30 lbs. last year, plans to keep her health a priority in 2013.

"Every day, I just renew my healthy choices," she says. "I feel really good about myself now, and I don't want to do anything to change that."

That means avoiding trendy diets or weight-loss gimmicks.

"My biggest regret is putting my body through fad diets: Atkins, cleanses, the hCG diet," Garth, 40, says. "I lost like 18 lbs., but it came right back. The worst was fasting with colonics for three or four days. It was the most horrifying experience ever."

In addition to her body, Garth says she's trying to maintain a positive outlook, even when times are tough.

"When I'm in excruciating pain, like with what I've been through with my breakup and that grief and loss that's just immobilizing, it helps to remember that it only lasts for 13 to 15 minutes, max," she tells Health. "And then it's over."

"Your mind is ready to go to something else," Garth continues. "You might come back to it, but it helps to just know that that pain is not going to last forever."

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Flu? Malaria? Disease forecasters look to the sky


NEW YORK (AP) — Only a 10 percent chance of showers today, but a 70 percent chance of flu next month.


That's the kind of forecasting health scientists are trying to move toward, as they increasingly include weather data in their attempts to predict disease outbreaks.


In one recent study, two scientists reported they could predict — more than seven weeks in advance — when flu season was going to peak in New York City. Theirs was just the latest in a growing wave of computer models that factor in rainfall, temperature or other weather conditions to forecast disease.


Health officials are excited by this kind of work and the idea that it could be used to fine-tune vaccination campaigns or other disease prevention efforts.


At the same time, experts note that outbreaks are influenced as much, or more, by human behavior and other factors as by the weather. Some argue weather-based outbreak predictions still have a long way to go. And when government health officials warned in early December that flu season seemed to be off to an early start, they said there was no evidence it was driven by the weather.


This disease-forecasting concept is not new: Scientists have been working on mathematical models to predict outbreaks for decades and have long factored in the weather. They have known, for example, that temperature and rainfall affect the breeding of mosquitoes that carry malaria, West Nile virus and other dangerous diseases.


Recent improvements in weather-tracking have helped, including satellite technology and more sophisticated computer data processing.


As a result, "in the last five years or so, there's been quite an improvement and acceleration" in weather-focused disease modeling, said Ira Longini, a University of Florida biostatistician who's worked on outbreak prediction projects.


Some models have been labeled successes.


In the United States, researchers at Johns Hopkins University and the University of New Mexico tried to predict outbreaks of hantavirus in the late 1990s. They used rain and snow data and other information to study patterns of plant growth that attract rodents. People catch the disease from the droppings of infected rodents.


"We predicted what would happen later that year," said Gregory Glass, a Johns Hopkins researcher who worked on the project.


More recently, in east Africa, satellites have been used to predict rainfall by measuring sea-surface temperatures and cloud density. That's been used to generate "risk maps" for Rift Valley fever — a virus that spreads from animals to people and in severe cases can cause blindness or death. Researchers have said the system in some cases has given two to six weeks advance warning.


Last year, other researchers using satellite data in east Africa said they found that a small change in average temperature was a warning sign cholera cases would double within four months.


"We are getting very close to developing a viable forecasting system" against cholera that can help health officials in African countries ramp up emergency vaccinations and other efforts, said a statement by one of the authors, Rita Reyburn of the International Vaccine Institute in Seoul, South Korea.


Some diseases are hard to forecast, such as West Nile virus. Last year, the U.S. suffered one of its worst years since the virus arrived in 1999. There were more than 2,600 serious illnesses and nearly 240 deaths.


Officials said the mild winter, early spring and very hot summer helped spur mosquito breeding and the spread of the virus. But the danger wasn't spread uniformly. In Texas, the Dallas area was particularly hard-hit, while other places, including some with similar weather patterns and the same type of mosquitoes, were not as affected.


"Why Dallas, and not areas with similar ecological conditions? We don't really know," said Roger Nasci of the Centers for Disease Control and Prevention. He is chief of the CDC branch that tracks insect-borne viruses.


Some think flu lends itself to outbreak forecasting — there's already a predictability to the annual winter flu season. But that's been tricky, too.


Seasonal flu reports come from doctors' offices, but those show the disease when it's already spreading. Some researchers have studied tweets on Twitter and searches on Google, but their work has offered a jump of only a week or two on traditional methods.


In the study of New York City flu cases published last month in the Proceedings of the National Academy of Sciences, the authors said they could foredcast, by up to seven weeks, the peak of flu season.


They designed a model based on weather and flu data from past years, 2003-09. In part, their design was based on earlier studies that found flu virus spreads better when the air is dry and turns colder. They made calculations based on humidity readings and on Google Flu Trends, which tracks how many people are searching each day for information on flu-related topics (often because they're beginning to feel ill).


Using that model, they hope to try real-time predictions as early as next year, said Jeffrey Shaman of Columbia University, who led the work.


"It's certainly exciting," said Lyn Finelli, the CDC's flu surveillance chief. She said the CDC supports Shaman's work, but agency officials are eager to see follow-up studies showing the model can predict flu trends in places different from New York, like Miami.


Despite the optimism by some, Dr. Edward Ryan, a Harvard University professor of immunology and infectious diseases, is cautious about weather-based prediction models. "I'm not sure any of them are ready for prime time," he said.


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Asia stocks eke out gains on China hopes, oil eases

HONG KONG (Reuters) - Most Asian stock markets edged higher on Thursday on hopes of a steady economic revival in China, although oil gave back part of the previous session's strong gains as investors took some money off the table and braced for more U.S. budget battles.


The MSCI Asia Pacific ex-Japan index of stocks <.miapj0000pus> rose 0.2 percent following Wednesday's 2 percent jump on relief that U.S. politicians had averted the "fiscal cliff".


Data from China showing the services sector expanded in December continued to underpin expectations of an economic recovery that has helped spur a strong rally in Hong Kong-listed Chinese shares <.hsce> over the past month.


The China Enterprises index <.hsce> which rallied more than 4 percent in the previous session eased 0.2 percent. Onshore Chinese markets will resume trading on Friday.


"China looks like it's improving at the margin and the market has momentum that could last for at least a few months," said Christian Keilland, head of trading at BTIG in Hong Kong.


"Investors seem to have accepted that reforms are underway but they're going to happen at a slower pace."


Australian stocks <.axjo> rose 0.7 percent to their highest in more than 19 months, with mining giants Rio Tinto up 2.4 percent and BHP Billiton up 0.8 percent, among the top gainers on the benchmark S&P ASX/200 index. <.axjo/>


South Korea's Kospi <.ks11> underperformed the region, falling 0.4 percent as automakers and other exporters slumped on a stronger Korean won, which hit a 16-month high against the dollar overnight.


In other currency markets, the Japanese yen bounced after hitting a 29-month low versus the dollar earlier in the day but analysts warned that any strength is likely to be short-lived.


"Technically dollar/yen looks somewhat overbought here. It's gone a long way in a very short time," said Callum Henderson, global head of FX research for Standard Chartered Bank in Singapore, adding that the dollar could see some consolidation in the near term before heading higher.


The euro which in overnight trading was close to a 8-1/2 month high against the dollar, slipped 0.1 percent.


The U.S. dollar rose 0.2 percent <.dxy> against a basket of major currencies.


President Barack Obama and congressional Republicans face even bigger budget battles in the next two months after a hard-fought deal averted the fiscal cliff of automatic tightening that threatened to push the U.S. into recession.


Strength in the dollar and profit-taking pushed oil prices lower with Brent crude slipping 0.3 percent and U.S. crude futures down 19 cents to $92.93.


"After the initial excitement, reality sets in," said Victor Shum, oil consultant at IHS Purvin & Gertz. "There will be other negotiations and the deal is a compromise."


(Reporting by Vikram Subhedar; Editing by Kim Coghill and Eric Meijer)



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