Investors face another Washington deadline

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


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


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


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


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


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


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


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


OPTIONS BULLS TARGET GAINS


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


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


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


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


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


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


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


EYES ON GDP DATA, APPLE


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


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


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


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


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


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



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Analysis: Italian election explained











Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader








STORY HIGHLIGHTS


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

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

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

  • Italy's political system encourages the forming of alliances




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


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


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


Why have the elections been called now?


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






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


MORE: From Venice to bunga bunga: Italy in coma


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


Who are the candidates?


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


How will the election be conducted?


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


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


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


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


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


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


Who is likely to be the next prime minister?


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


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


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


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


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


What are the main issues?


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


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


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


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


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


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


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


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


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


Why is political instability so endemic to Italy?


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


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


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


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







Read More..

At least 15 hurt in crash at Daytona Speedway

YouTube video posted by user tyler4dx that shows fans being injured by debris coming into the grandstand area at Daytona International Speedway.









DAYTONA BEACH – More than two dozen people in the stands were injured at Daytona International Speedway when a multicar accident sent wreckage into the safety fence in front of the grandstand Saturday afternoon, authorities said.


The accident came on the final lap of the NASCAR Nationwide Series DRIVE4COPD 300.


Fourteen people were taken to hospitals. Another 14 were treated at the track, officials said.








Volusia County emergency responders transported eight race fans, six of which were trauma level patients with serious injuries, said Volusia County government spokesman Dave Byron.


Six were sent to Halifax Health Medical Center in Daytona Beach, one was taken to Florida Hospital Memorial Medical Center in Daytona Beach and one to Halifax Health Medical Center of Port Orange. It's not clear where the other six were taken, nor were their conditions released.


As drivers jockeyed for position on the final lap, a number of cars made contact. Kyle Larson's' car was sheared in half as cars spun out of control.


"We saw a tire and debris go into the crowd," said race fan Bryon Gifford of Orlando, who had seats along the front stretch. "There was chaos everywhere."


As drivers jockeyed for position on the final lap, a number of cars made contact. Kyle Larson's' car was sheared in half as cars spun out of control..


His engine caught fire and ended up in front of fans along the front stretch after the car tore through the catch fence that's designed to protect fans in case of accidents. The debris splattered, hitting a spectator 45 rows up in the stands at Daytona International Speedway. Other car parts, included a tire, also flew into the stands.


"I know I took a couple of big hits there and saw my engine was gone," Larson said.


Tony Stewart raced through the carnage to win the race.


"The important thing is what's going on the front stretch right now," he said."We've always known since racing was started this is a dangerous sport. But it's hard. We assume that risk. It's hard when the fans get caught up in it.


"As much as we want to celebrate right now, as much as this is a big deal to us, I'm more worried about the drivers and fans in the stands right now. I could see it all in the mirror and it didn't look good from where I was, either."


Although no driver was seriously hurt, the condition of the fans was still being assessed.


"You've been able to see and explain," said Mike Helton, NASCAR President on the ESPN broadcast following the race. "There was some intrusion into the fence, and there were plenty of emergency workers ready to go and jumped right into it quickly."


"They are moving folks into the care center and Halifax Medical Center."


Driver Michael Annett was transported to Halifax Medical Center after his car slammed into the SAFER barrier head on during an earlier incident during the race.


NASCAR spokesman Kerry Tharp said the damage to the stands will be reviewed in time for the running of the 55th Daytona 500 Sunday afternoon.


Sentinel staff writers Susan Jacobson and Arelis R. Hernández contributed to this report. Read George Diaz's blog at OrlandoSentinel.com/enfuego or e-mail him at gdiaz@orlandosentinel.com



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Italians head to polls in crucial vote for euro zone


ROME (Reuters) - Italians vote on Sunday in one of the most closely watched elections in years with markets nervous about whether it will produce a strong government to pull Italy out of recession and help resolve the euro zone debt crisis.


A huge final rally by anti-establishment-comedian-turned-politician Beppe Grillo on Friday before a campaigning ban kicked in has highlighted public anger at traditional parties and added to uncertainty about the election outcome.


Polling booths will open between 02:00 am-04:00 pm EST on Sunday and 01:00 am-09:00 am EST on Monday. Exit polls will come out soon after voting ends and official results are expected by early Tuesday.


The election will be followed closely by financial markets with memories still fresh of the potentially catastrophic debt crisis that brought technocrat Prime Minister Mario Monti to power more than a year ago.


Italy, the euro zone's third-largest economy, is stuck in deep recession, struggling under a public debt burden second only to Greece's in the 17-member currency bloc and with a public weary of more than a year of harsh austerity policies.


Italy's Interior Ministry has urged some 47 million eligible voters to not let bad weather forecasts put them off, and said it was prepared to handle even snowy conditions in some northern regions to ensure everyone had a chance to vote.


Final polls published two weeks ago showed center-left leader Pier Luigi Bersani with a five-point lead, but analysts disagree about whether he will be able to form a stable majority that can push though the economic reforms Italy needs.


Bersani is now thought to be just a few points ahead of center-right rival Silvio Berlusconi, the four-times prime minister who has promised tax refunds and staged a media blitz in an attempt to win back voters in recent weeks.


While the center left is still expected to gain control of the lower house thanks to rules that guarantee a strong majority to whichever party wins the most votes nationally, a much closer battle will be fought in the Senate, which any government also needs to control in order to be able to pass laws.


Seats in the upper house are awarded on a region-by-region basis, meaning that support in key regions can decisively influence the overall result.


Pollsters still believe the most likely outcome is a center-left government headed by Bersani and possibly backed by Monti, who is leading a centrist coalition.


But strong campaigning by Berlusconi and the fiery Grillo, who has drawn tens of thousands to his election rallies, have thrown the election wide open, causing concern that there may be no clear winner.


Whatever government emerges from the vote will have the task of pulling Italy out of its longest recession for 20 years and reviving an economy largely stagnant for two decades.


The main danger for Italy and the euro zone is a weak government incapable of taking firm action, which would rattle investors and could ignite a new debt crisis.


Monti replaced Berlusconi in November 2011 after the euro zone's third-largest economy came close to Greek-style financial meltdown while the center-right government was embroiled in scandals.


The former European Commissioner launched a tough program of spending cuts, tax hikes and pension reforms which won widespread international backing and helped restore Italy's credibility abroad after the scandals of the Berlusconi era.


Italy's borrowing costs have since fallen sharply after the European Central Bank pledged it was prepared to support countries undertaking reforms by buying unlimited quantities of their bonds on the markets.


But economic austerity has fuelled anger among Italians grappling with rising unemployment and shrinking disposable incomes, encouraging many to turn to Grillo, who has tapped into a national mood of disenchantment.


(Reporting by Catherine Hornby; Editing by Jason Webb)



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Wall Street rebounds on HP results, Fed officials' views

NEW YORK (Reuters) - U.S. stocks rose on Friday as Dow component Hewlett-Packard surged on strong results and comments from Fed officials allayed fears that the central bank would curtail its stimulus measures.


Federal Reserve Chairman Ben Bernanke downplayed worries that the Fed has fueled asset bubbles that could hurt the economy in a private meeting with bond dealers and investors earlier this month, Bloomberg reported on Friday.


Bernanke's view helped ease fears that the central bank may end its easy money policies. Minutes from the Federal Reserve's January meeting hit markets on Wednesday as investors interpreted divergent opinions on the benefit of stimulus as a sign the measures may be halted sooner than thought.


"They are in uncharted territory with divergent views," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago. "I could see some pretty heated opinions on what the ultimate outcome is, so I do believe there is dissension."


Hewlett-Packard Co shares jumped more than 12 percent and gave one of the biggest boosts to both the Dow and the S&P 500 after the personal computer maker's quarterly revenue and forecasts beat expectations. Hewlett-Packard's stock rose to $19.20 at the close, up 12.3 percent for the day.


The Dow Jones industrial average <.dji> gained 119.95 points, or 0.86 percent, to 14,000.57 at the close. The Standard & Poor's 500 Index <.spx> rose 13.18 points, or 0.88 percent, to 1,515.60. The Nasdaq Composite Index <.ixic> added 30.33 points, or 0.97 percent, to end at 3,161.82.


With Bernanke's reported comments much on their minds in Friday's session, investors will want the Fed chairman to reiterate his remarks publicly when he speaks before the Senate Banking Committee on Tuesday. That would echo comments made by two top Fed officials on Friday.


Boston Fed President Eric Rosengren and Fed Governor Jerome Powell both defended the U.S. central bank's asset-buying program, arguing that the policy helps the U.S. economy.


The S&P 500 shed 1.9 percent over the previous two sessions, its worst two-day drop since early November, following the release of the Fed's minutes on Wednesday. The selloff marked the end of seven back-to-back weeks of gains for stocks.


For the week, the S&P 500 slipped 0.3 percent and the Nasdaq lost nearly 1 percent. Only the Dow ended the week with a gain - up just 0.1 percent.


HP's results come near the end of a relatively strong earnings season in which 70 percent of S&P 500 companies beat analysts' expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.


"Overall, the earnings supports were better than expected in this cycle," said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois. "We may see the market rising during the month of March."


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


But with only a handful of companies left to report earnings, investors are looking ahead to the possibility of hefty automatic budget cuts that could happen on March 1.


A large option investor appeared to be adjusting a bearish view on the SPDR S&P 500 Trust fund while locking in previously established gains, in a possible hedge ahead of the automatic budget cuts that are set to take effect at the beginning of next month. The play involved weekly puts, expiring next Friday.


"An institutional investor appears to be rolling down and increasing in size a defensive hedge timed to match the March 1 deadline for the sequester," said Henry Schwartz, president of options analytics firm Trade Alert.


The trader sold 132,000 $149 to $150 weekly put spreads for 22 cents as shares of the exchange-traded fund had traded near $151.14 on Friday morning. The transaction entailed the sale of $150 weekly puts to buy the $149 weekly puts. In addition, the investor purchased another 42,000 $149 weekly puts, which increases the size of the hedge to 174,000 contracts.


"It is likely this large position protects an existing underlying long position in a portfolio," Schwartz said.


In another political risk factor, Italians go to the polls this weekend in an election that could threaten reforms in the indebted country. Silvio Berlusconi's resurgence has thrown the vote wide open, with deep uncertainty over whether the poll can produce the strong government the country needs.


Inconclusive Greek elections last year sparked a protracted selloff and a period of uncertainty in markets.


In the tech sector, Marvell Technology Group Ltd forecast results this quarter that were largely above analysts' expectations. Marvell gained market share in the hard-disk drive and flash-storage businesses. The stock rose 4.4 percent to $9.89.


Texas Instruments Inc raised its dividend by a third and boosted its stock-buyback program, driving its stock up 5.2 percent to $34.18.


The PHLX semiconductor index <.sox> gained 2.1 percent.


"Dividends growing are another way the market's level is justified, if not especially attractive at these levels," said Rex Macey, chief investment officer of Wilmington Trust in Atlanta, who manages about $20 billion in assets.


On the downside, Abercrombie & Fitch dropped 4.5 percent to $46.86 after the youth-oriented clothing retailer reported a drop in fourth-quarter comparable sales, even as its latest quarterly earnings topped estimates.


Insurer American International Group Inc posted fourth-quarter results that beat analysts' expectations. AIG's stock advanced 3.1 percent to $38.45.


About three stocks rose for every one that fell on both the New York Stock Exchange and Nasdaq.


Around 5.8 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the 20-day moving average of around 6.51 billion shares.


(Additional Reporting by Ryan Vlastelica and Doris Frankel; Editing by Kenneth Barry and Jan Paschal)



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Oscar Pistorius gets bail as murder trial looms


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


___


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


___


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


Read More..

Analysis: Italian election explained











Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader


Austerity-hit Italy chooses new leader








STORY HIGHLIGHTS


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

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

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

  • Italy's political system encourages the forming of alliances




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


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


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


Why have the elections been called now?


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






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


MORE: From Venice to bunga bunga: Italy in coma


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


Who are the candidates?


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


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


How will the election be conducted?


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


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


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


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


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


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


Who is likely to be the next prime minister?


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


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


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


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


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


What are the main issues?


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


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


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


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


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


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


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


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


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


Why is political instability so endemic to Italy?


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


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


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


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







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Drew Peterson transferred from Will County jail to Stateville









Drew Peterson’s new life as an Illinois Department of Corrections inmate has begun.


Peterson was transferred this morning to the Stateville Correctional Center near Crest Hill,  where he will be evaluated for placement based upon factors such as his conviction, length of sentence, program needs and medical and mental health requirements.


The Will County jail – which has held Peterson in solitary confinement since his May 2009 arrest for his own safety – had the paperwork prepared for his transfer by the time he returned from his sentencing hearing Thursday, officials said.








The sheriff’s department, which oversees the jail, kept the former Bolingbrook police sergeant segregated from the general population there amid concerns that his high-profile case and law-enforcement background would make him a target of inmates looking to build tough-guy reputations.


Jail supervisors began preparing Peterson at 8:30 a.m. and he left without incident by 9:22 a.m., officials said.


Drew Peterson wanted to make sure he was heard when he was given one last chance to speak Thursday, shortly before being sentenced to 38 years in prison for the murder of his third wife, Kathleen Savio.

Declining to speak from the defense table, where there was no microphone, the former Bolingbrook police sergeant shuffled to the witness stand in his jail-issued blue scrubs and orange shoes and began quietly.


"I hope I don't aggravate the situation," he turned and told the judge. Then Peterson screamed into the microphone, "I did not kill Kathleen!" startling almost everyone in the courtroom.


"Yes, you did!" Savio's sister Sue Doman yelled back from the gallery, prompting Will County Circuit Judge Edward Burmila to order her out of the courtroom.


It was an odd end to a case replete with oddities and circuslike sideshows. For the next 40 minutes, Peterson cried, raged and whispered, challenged the state's attorney to look him in the eye and indulged in self-pity as he unleashed his multitudinous thoughts like a character in a Dostoevsky novel.


The 59-year-old said he expects to die in prison. Barring any successful appeal, he won't be eligible for release until he's 93.


Peterson claimed that lies and mistakes by witnesses, prosecutors and police led to his conviction, and made disparaging remarks about Savio's family, attorneys and others involved in the case. His defense attorneys called the monologue an impassioned plea for leniency, but prosecutors said it was proof that Peterson is a psychopath.


"When he got up on the stand and (in) that shrill, kinda-feminine screech that he didn't kill Kathy — that's the guy that killed Kathy," Will County State's Attorney James Glasgow said. "You got a glimpse into his soul."


But in describing himself on the stand Thursday, Peterson said he was maligned and misunderstood.


"Until this happened, I thought I was viewed as a great guy," Peterson said, giving a litany of public and private good deeds before announcing he planned to tattoo the phrase "No good deed goes unpunished" across his shoulders.


"The state took an accident and staged a homicide," Peterson said, before turning to the judge. "Can I get some water?"


Once refreshed, Peterson said he had upheld the oath he swore when he became a police officer.


"I always took my job seriously, I never violated the public trust," he said, his voice husky with emotion before quoting one of the Ten Commandments. "And I never beared false witness against anyone."


"I think the only thing left to make this case run true to form," he told Burmila, stopping to take a tissue and wipe his nose, "would be a cruel and unusual punishment. And I don't think anybody would care, because nobody cares. I can't believe I spent 32 years defending a constitution that allowed this to happen to me."


It's not uncommon for a defendant to lash out against those who put them behind bars. It is rare, however, for defendant to offer a long, extemperaneous speech that both walks the court through the evidence and ilicits angry outbursts from the victims' families.


Peterson accused the state's attorney's office, state police, Savio's family and even Lifetime TV of being part of various conspiracies to wrongfully convict him. Last year, Lifetime TV aired a movie about Peterson with Rob Lowe playing the suburban police officer. Peterson said the "ridiculous movie" denied him a right to a fair trial and included statements he'd made to state police.





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


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


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


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


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


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


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


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


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


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


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


'ABENOMICS' TO BOOST TRADE


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


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


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


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


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


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


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


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


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


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



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Wall Street ends lower on growth worries

NEW YORK (Reuters) - U.S. stocks fell for a second straight day on Thursday and the S&P 500 posted its worst two-day loss since November after reports cast doubt over the health of the U.S. and euro-zone economies.


But a late-day rally helped stocks erase some of their losses with most of the pullback concentrated in the technology- heavy Nasdaq. The move suggested investors were still willing to buy on dips even after the sharp losses in the last session.


In Europe, business activity indexes dealt a blow to hopes that the euro zone might emerge from recession soon, showing the downturn across the region's businesses unexpectedly grew worse this month.


"The PMI numbers out of Europe were really a blow to the market," said Jack De Gan, chief investment officer at Harbor Advisory in Portsmouth, New Hampshire. "The market was expecting signs that recovery is still there, but the numbers just highlighted that the euro-zone problem is still persistent."


U.S. initial claims for unemployment benefits rose more than expected last week while the Federal Reserve Bank of Philadelphia said its index of business conditions in the U.S. mid-Atlantic region fell in February to the lowest in eight months.


Gains in Wal-Mart Stores Inc shares helped cushion the Dow. The shares gained 1.5 percent to $70.26 after the world's largest retailer reported earnings that beat expectations, though early February sales were sluggish.


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


The two-day decline marked the U.S. stock market's first sustained pullback this year. The Standard & Poor's 500 has fallen 1.8 percent over the period and just managed to hold the 1,500 level on Thursday. Still, the index is up 5.3 percent so far this year.


The abrupt reversal in markets, which started on Wednesday after minutes from the Federal Reserve's January meeting suggested stimulus measures may end earlier than thought, looks set to halt a seven-week winning streak for stocks that had lifted the Dow and the S&P 500 close to all-time highs.


Wall Street will soon face another test with the upcoming debate in Washington over the automatic across-the-board spending cuts put in place as part of a larger congressional budget fight. Those cuts, set to kick in on March 1 unless lawmakers agree on an alternative, could depress the economy.


Semiconductor stocks ranked among the weakest of the day, pressuring the Nasdaq as the Philadelphia Semiconductor Index <.sox> fell 1.8 percent. Intel Corp fell 2.3 percent to $20.25 while Advanced Micro Devices lost 3.7 percent to $2.60 as the S&P 500's biggest percentage decliner.


The Dow also got a helping hand from personal computer maker Hewlett-Packard Co , which rose 2.3 percent to end the regular session at $17.10. The company was scheduled due to report first-quarter results after the closing bell.


Shares of Boeing Co rose 1.6 percent to $76.01 as a senior executive was set to meet with the head of the U.S. Federal Aviation Administration on Friday and present a series of measures to prevent battery failures that grounded its 787 Dreamliner fleet, according to a source familiar with the plans.


In other company news, shares of supermarket operator Safeway Inc jumped 14.1 percent to $22.97 after the company reported earnings that beat expectations.


Shares of VeriFone Systems Inc tumbled nearly 43 percent to $18.24 after the credit-card swipe machine maker forecast first- and second-quarter profits well below expectations.


Of the 427 companies in the S&P 500 that have reported results so far, 69.3 percent have exceeded analysts' expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data through Thursday morning.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.9 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


Berry Petroleum Co jumped 19.3 percent to $46.02 after oil and gas producer Linn Energy LLC said it would buy the company in an all-stock deal valued at $4.3 billion, including debt. Linn Energy shares advanced 2.8 percent to $37.68.


About two stocks fell for everyone that rose on the New York Stock Exchange and Nasdaq. About 7.64 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, well above the 20-day moving average of around 6.6 billion shares.


(Editing by Jan Paschal)



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SAfrica police replace top Pistorius investigator


PRETORIA, South Africa (AP) — South African police appointed a new chief investigator Thursday in the Oscar Pistorius murder case, replacing a veteran detective after unsettling revelations that the officer was charged with seven counts of attempted murder.


The sensational twist in the state's troubled investigation fueled growing public fascination with the case against the double-amputee Olympian, who is charged with premeditated murder in the Valentine's Day slaying of his girlfriend, Reeva Steenkamp.


Pistorius, a sporting icon and source of inspiration to millions until the shooting last week, is backed by a high-powered team of lawyers and publicists. The abruptness of his fall, and its gruesome circumstances, have gripped a global audience and put South Africa's police and judicial system under the spotlight.


The man at the center of the storm sat in the dock during his bail hearing, mostly keeping his composure in contrast to slumped-over outbursts of weeping on previous days in court. In front of Pistorius, defense lawyer Barry Roux pounced on the apparent disarray in the state's case, laying out arguments that amounted to a test run for the full trial yet to come.


Roux pointed to what he called the "poor quality" of the state's investigation and raised the matter of intent, saying Pistorius and Steenkamp had a "loving relationship" and the athlete had no motive to plan her killing.


Pistorius, 26, says he mistook Steenkamp for an intruder when he shot her through a locked bathroom door in his home. Prosecutors believe the shooting happened after the couple got into an argument, and prosecutor Gerrie Nel painted a picture of a man he said was "willing and ready to fire and kill."


Much of the drama Thursday, however, happened outside the courtroom as South African police scrambled to get their investigation on track.


In a news conference at a training academy, National Police Commissioner Riah Phiyega said a senior detective would gather a team of "highly skilled and experienced" officers to investigate the killing of 29-year-old Steenkamp, a model and budding reality TV contestant.


The decision to put police Lt. Gen. Vinesh Moonoo in charge came soon after word emerged that the initial chief investigator, Hilton Botha, is facing attempted murder charges, and a day after he offered testimony damaging to the prosecution.


Botha acknowledged Wednesday in court that nothing in Pistorius' version of the fatal shooting contradicted what police had discovered, even though there have been some discrepancies. Botha also said that police left a 9 mm slug in the toilet and lost track of allegedly illegal ammunition found in Pistorius' home.


"This matter shall receive attention at the national level," Phiyega told reporters after testimony ended in the third day of Pistorius' bail hearing.


Bulewa Makeke, spokeswoman for South Africa's National Prosecuting Authority, said the attempted murder charges had been reinstated against Botha on Feb. 4. Police say they found out about it after Botha testified in Pistorius' bail hearing Wednesday.


Botha and two other police officers had seven counts of attempted murder reinstated against them in connection with a 2011 shooting incident in which they allegedly fired shots at a minibus they were trying to stop.


Makeke indicated the charges were reinstated because more evidence had been gathered. She said the charge against Botha was initially dropped "because there was not enough evidence at the time."


Pistorius' main sponsor, Nike, meanwhile, suspended its contract with the multiple Paralympic champion, following eyewear manufacturer Oakley's decision to suspend its sponsorship. Nike said in a statement on its website: "We believe Oscar Pistorius should be afforded due process and we will continue to monitor the situation closely."


On Thursday, Chief Magistrate Desmond Nair asked the defense regarding Pistorius' bail application: "Do you think there will be some level of shock if the accused is released?"


Defense lawyer Roux responded: "I think there will be a level of shock in this country if he is not released."


Prosecutor Nel suggested signs of remorse from Pistorius had nothing to do with whether he planned to kill his girlfriend.


"Even if you plan a murder, you plan a murder and shoot. If you fire the shot, you have remorse. Remorse might kick in immediately," Nel said.


As Nel summed up the prosecution's case opposing bail, Pistorius began to weep in the crowded courtroom, leading his brother, Carl Pistorius, to reach out and touch his back.


"He (Pistorius) wants to continue with his life like this never happened," Nel went on, prompting Pistorius, who was crying softly, to shake his head.


"The reason you fire four shots is to kill," Nel persisted.


Earlier Thursday, Nair questioned Botha over delays in processing records from phones found in Pistorius' house following the slaying.


"It seems to me like there was a lack of urgency," the magistrate said.


Botha is to appear in court in May to face seven counts of attempted murder in connection with the minibus shooting incident. He has been quoted in the South African media as denying allegations he was drunk at the time, saying he and the other officers were trying to stop the vehicle and didn't know there were people inside.


While Botha has been dropped from the Pistorius investigation, he has not been suspended from the police force, Phiyega said, and could still be called by defense lawyers at trial.


Pistorius, wearing the same gray suit, blue shirt and gray tie combination he has worn throughout the bail hearing, stood ramrod straight in the dock, then sat calmly looking at his hands.


Roux said an autopsy showed that Steenkamp's bladder was empty, suggesting she had gone to the bathroom to use the toilet, rather than fled there to escape an enraged Pistorius, as prosecutors contend.


"The known forensics is consistent" with Pistorius' statement, Roux said, asking that bail restrictions be eased for his client.


But the prosecutor said Pistorius hadn't given guarantees to the court that he wouldn't leave the country if he was facing a life sentence. Nel also stressed that Pistorius shouldn't be given special treatment.


"'I am Oscar Pistorius. I am a world-renowned athlete.' Is that a special circumstance? No," Nel said. "His version (of the killing) is improbable."


Nel said the court should focus on the "murder of the defenseless woman."


Botha testified Thursday that he investigated a 2009 complaint against Pistorius by a woman who said the athlete assaulted her. However, Pistorius did not hurt the woman, who in fact injured herself when she kicked a door at Pistorius' home, Botha said.


___


AP Sports Writer Gerald Imray contributed to this report from Johannesburg


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Drew Peterson: 'Until this happened, I thought I was a great guy'









Moments after screaming in court, "I did not kill Kathleen," Drew Peterson was sentenced to 38 years in prison for the 2004 murder of his third wife Kathleen Savio.

Peterson had faced as much as 60 years, but Judge Edward Burmila said he gave Peterson some consideration for his years as a police officer and his service in the military. Peterson is 59.


The sentence was handed down after Peterson, who did not testify at his trial, made an emotional appeal to the judge, at times appearing to choke up as he argued that he was convicted by "rumors, gossip, outrageous lies and, most importantly, unreliable hearsay."


"I don't deserve this," he told Burmila. "I don't deserve this."








Peterson, a former Bolingbrook police sergeant, was convicted last fall of drowning Savio in her bathtub. Prosecutors have said they believe Peterson also killed his missing fourth wife Stacy and could seek charges in that case.


Peterson began his appeal to the judge today by telling him, "Good day, my name is Drew Peterson. I hope I don't aggravate the situation here, but I have a lot of things to be said." Then he screamed, "I did not kill Kathleen!"

"Yes, you did," a woman said.

"Ma'am, I'd like you to leave the courtroom," Burmila said. "And Mr. Peterson, don't make any outbursts that are designed to aggravate people."

"I'm sorry, your honor. I must have been woozy," Peterson said.


After the sentencing, State's Atty. James Glasgow dismissed the outburst as a "shrill, kind of feminine screech."


Peterson insisted to the judge he is the victim of an unjust and invasive police investigation that ignored or lost evidence that could have shown his innocence. He accused the state police of falsifying reports.

"What they did uncover was rumors, gossip, outrageous lies, and most importantly, unreliable hearsay. Hearsay that pierced three privileges that have stood for centuries," Peterson said.

Peterson bitterly complained that the Rev. Neil Schori betrayed his promise never to repeat anything that was said by Peterson or Stacy. Schori testified at trial that Stacy confided to him that she lied to state police about Peterson's alleged slaying of Savio.

"Out of the privileged information from Neil Schori, the state police was able to create" a case, he said. "I find it hard to believe that the state was able to take information that they obtained illegally and turn it to their benefit."

Kathleen Savio’s divorce attorney Harry Smith, who also testified at trial about a conversation he had with Stacy before she disappeared, "gave up privileged information from both Kathy and Stacy, like it was yesterday's garbage," Peterson said. "Ultimately, it led to my conviction.

"Hearsay is a scary thing. There's no proof. Anything can be said and nobody's accountable for the truth.

"In my experience, in divorce situations everybody lies, and everybody lies under the instruction of their attorneys.

"There was an incident where Kathleen exited the house ... and punched Stacy in the face. They went to trial, my 9- and 10-year-old sons were called to testify, and under oath they lied," Peterson said.

"On their next visit, I questioned them, 'Why’d you guys lie?' They said Harry Smith told them to. They didn’t want their mom to go to jail,” Peterson said, growing emotional as he spoke. “I couldn't be mad at them.”

"Stacy provided me an alibi for Kathleen's death. Then she later said she was lying about that. Seems like Stacy was lying all the time about everything. But the state's attorney picked and chose what they wanted to believe.

"Stacy clearly had a crush on the Rev. Schori, which I think was a factor in this.

"There was a constant and consistently illegal activity by the state’s attorneys, including the state’s attorney himself.

"So what did the state’s attorney do? They hire a skinny ... spokesperson (Stacy Peterson family spokeswoman Pam Bosco) to go out and say anything she wants. It buffered the state’s attorney’s office from anything the court might bring.

"And when it came time for a vote from the grand jury, only a handful of people were selected. Not the entire grand jury was brought in to do the vote. Pretty much guaranteed ... that I was indicted, which I was.

"There was a first investigation on this case, in which probably one of the most experienced investigators was the first one on the scene in this case, and he determined Kathleen's death was an accident.

"Dr. (Bryan) Mitchell looked at Kathy's body when it was in its freshest state. He determined her death was an accident."

So did the coroner's jury, Peterson said. "All this was done when the evidence was freshest."

Peterson then paused and asked for some water. He resumed by talking about his service in the military and lengthy law enforcement career.

"I was probably one of the highest-decorated officers in the Bolingbrook Police Department," he said.


"I always took my job seriously, I never violated the public trust," he said, his voice husky with emotions. "And I never beared false witness against anyone.

"I loved having a job that helped people," he said. "In my private life, I ran up to six companies at one time. I employed nearly 100 people.

"Until this happened, I thought I was a great guy," he said. "And in moments, the media turned me into a monster.

"As soon as I get a chance, I'm going to get a tattoo on my back, from shoulder to shoulder, that says, 'No good deed goes unpunished.' "

He said he loved Savio and called her a good wife and mother who did not deserve to die, but insited it was an accident. He then talked about Savio’s upbringing, calling it difficult and abusive.

"The most pathetic thing I’ve ever seen in my life was the night after our wedding, when I held Kathy and she cried because her father failed to show up and give her away on her wedding.

"At Kathy's wake, friends and family put money in cards and envelopes to help cover the cost of the funeral.

“I paid for the funeral."

"That's a lie right there," a man in court shouted.

"I paid for Kathy’s funeral at the request of her sister, who's sitting right there," Peterson said.

He then attacked State's Atty. James Glasgow.

"Mr. Glasgow, all aspects of my life have been destroyed. Everything from my personal life to my professional life to my social life -- all aspects have been destroyed. And I tell you this to give you greater cause for celebration, when you celebrate the fact that you perpetrated the largest railroad job in the history of this country.

"Since I've been incarcerated, I've had nine family members who have died, six of which were cousins," Peterson said. None of them made it past the age of 60, he said.

“And in telling you this, I'm not looking for any sympathy, but anything you sentence me to, you're sentencing me to the Department of Corrections to die!" Peterson said.

Peterson said he believes his constitutional rights have been violated.

"And I think the only thing left to make this case run true to form would be a cruel and unusual punishment. And I don't think anybody would care because nobody cares. I can't believe I spent 32 years defending a constitution that allowed this to happen to me. I can't believe people fought and died in wars protecting a constitution that allowed this to happen to me.”

America should be outraged, but nobody cares, he said.

"I take full responsibility for my relationship with the media," Peterson continued. "I just wanted them away from my home because they were scaring my kids. They hounded me. I agreed to go on TV and tell my story and ask for legal help.

"Everybody from busy bodies like Nancy Grace ... to that ridiculous movie that played repeatedly before and during my trial.

"It pretty much guaranteed that I would not get a fair trial. It's pretty clear that the state took part in that movie because things I remember saying only to the state police appeared in that movie," Peterson said, apparently referring to a Lifetime TV movie starring Rob Lowe as Peterson.

"I'm an obnoxious man by nature, truly. And after 30 years as a police officer, as is normal with a police officer, my defense mechanism is comedy. The media took that and capitalized on that, and my obnoxious nature showed through. But I want to ensure the court that at no time did I want to portray any insensitivity about Kathy's death. That was not my intention.

“I hope Mr. Glasgow looks me in the eye right now. Never forget my face! Never forget what you’ve done. 

“Originally I had some cute and funny things to say. But now in closing, it's time to be sentenced to a life of hardship and abuse in prison. I don't deserve this, I don't deserve this.

“Thank you.”


Earlier in the afternoon, Savio’s sister Anna Marie Savio-Doman told the judge that "my loss of my baby sister is beyond words. There will be no more birthday parties, backyard gatherings, holiday celebrations or other family activities to share. The laughter, hugs, guidance, advice, sense of security and those opportunities to say ‘I love you’ are forever gone.

“One of the hardest things for me is knowing the pain and fear that Kathleen must have suffered at the time of her murder. The horror and betrayal she must have felt when she realized that someone she had trusted and loved more than anything was actually killing her. I wonder if she could feel her heart breaking when she thought about leaving her two boys forever. The helplessness she must have felt knowing she was going to die.

“I have to say it hurts a lot. I hope it gets better, but I am not confident it will get better. I still talk to her. I hope she can hear me.”

Susan Doman described her sister as a “rock” and told the court she looked up to Savio, even though Savio was younger. She also expressed her anger toward Peterson.

“He showed no remorse,” she said. “For years I watched Peterson parade on TV, radio, photo shoots, and (that) radio promotion to win a date with him. That was a big joke to him. And he loved all the attention.

“Your honor, the defendant shows no remorse to this day for the horrible crime that he did to my sister Kathleen. This senseless action is inexcusable. I am placing my trust that you will give Kathleen justice once and for all.”

The judge also read a statement from Savio’s father, but not aloud.

In arguing for a maximum sentence, Glasgow reminded the judge about the damage done to his young children with Stacy. Prosecutors have said they believe Peterson killed Stacy and could seek charges in that case.

"Not only is their mother gone, but also their father is gone, as he sits before you," Glasgow said.

Glasgow said Peterson also should not get a break for living a law- abiding life because of his attacks on his second wife, when he threatened to kill her.

"There's a recurring them here with Mr. Peterson. He’s a police officer, and there's a number of occurrences with the victims here being afraid to call the police department.

"These are obviously very dangerous situation, and in this case, led to the demise of two young women."

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French, Malian forces fight Islamist rebels in Gao


GAO, Mali (Reuters) - French and Malian troops fought Islamists on the streets of Gao and a car bomb exploded in Kidal on Thursday, as fighting showed little sign of abating weeks before France plans to start withdrawing some forces.


Reuters reporters in Gao in the country's desert north said French and Malian forces fired at the mayor's office with heavy machineguns after Islamists were reported to have infiltrated the Niger River town during a night of explosions and gunfire.


French Defense Minister Jean-Yves Le Drian told a news conference in Brussels that Gao was back under control after clashes earlier in the day.


"Malian troops supported by French soldiers killed five jihadists and the situation is back to normal," he said.


In Kidal, a remote far north town where the French are hunting Islamists, residents said a car bomb killed two. A French defense ministry source reported no French casualties.


French troops dispatched to root out rebels with links to al Qaeda swiftly retook northern towns last month. But they now risk being bogged down in a guerrilla conflict as they try to help Mali's weak army counter bombings and raids.


"There was an infiltration by Islamists overnight and there is shooting all over the place," Sadou Harouna Diallo, Gao's mayor, told Reuters by telephone earlier in the day, saying he was not in his office at the time.


Gao is a French hub for operations in the Kidal region, about 300 km (190 miles) northeast, where many Islamist leaders are thought to have retreated and foreign hostages may be held.


"They are black and two were disguised as women," a Malian soldier in Gao who gave his name only as Sergeant Assak told Reuters during a pause in heavy gunfire around Independence Square.


Six Malian military pickups were deployed in the square and opened fire on the mayor's office with the heavy machineguns. Two injured soldiers were taken away in an ambulance.


French troops in armored vehicles later joined the battle as it spilled out into the warren of sandy streets, where, two weeks ago, they also fought for hours against Islamists who had infiltrated the town via the nearby river.


Helicopters clattered over the mayor's office, while a nearby local government office and petrol station was on fire.


A Gao resident said he heard an explosion and then saw a Malian military vehicle on fire in a nearby street.


Paris has said it plans to start withdrawing some of its 4,000 troops from Mali next month. But rebels have fought back against Mali's weak and divided army, and African forces due to take over the French role are not yet in place.


Islamists abandoned the main towns they held but French and Malian forces have said there are pockets of Islamist resistance across the north, which is about the size of France.


CAR BOMB


Residents reported a bomb in the east of Kidal on Thursday.


"It was a car bomb that exploded in a garage," said one resident who went to the scene but asked not to be named.


"The driver and another man were killed. Two other people were injured," he added.


A French defense ministry official confirmed there had been a car bomb but said it did not appear that French troops, based at the town's airport, had been targeted.


Earlier this week, a French soldier was killed in heavy fighting north of Kidal, where French and Chadian troops are hunting Islamists in the Adrar des Ifoghas mountains, which border Algeria.


Operations there are further complicated by the presence of separatist Tuareg rebels, whose rebellion triggered the fighting in northern Mali last year but were sidelined by the better-armed Islamists.


Having dispatched its forces to prevent an Islamist advance south in January, Paris is eager not to become bogged down in a long-term conflict in Mali. But their Malian and African allies have urged French troops not to pull out too soon.


(Additional reporting by Emanuel Braun in Gao, Adama Diarra in Bamako, David Lewis and John Irish in Dakar and Adrian Croft in Brussels; Writing by David Lewis; Editing by Jason Webb and Roger Atwood)



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Wall Street ends down sharply after Fed minutes

DEAR ABBY: My boyfriend, "Doug" (24), and I (22) have been in a long-distance relationship for a year, but we were friends for a couple of years before that. I had never had a serious relationship before and lacked experience. Doug has not only been in two other long-term relationships, but has had sex with more than 15 women. One of them is an amateur porn actress.I knew about this, but it didn't bother me until recently. Doug had a party, and while he was drunk he told one of his buddies -- in front of me -- that he should watch a certain porn film starring his ex-girlfriend. ...
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Police add more confusion to Oscar Pistorius case


PRETORIA, South Africa (AP) — The prosecution case against Oscar Pistorius began to unravel Wednesday with revelations of a series of police blunders and the lead investigator's admission that authorities have no evidence challenging the double-amputee Olympian's claim he killed his girlfriend accidentally.


Detective Hilton Botha's often confused testimony left prosecutors rubbing their heads in frustration as he misjudged distances and said testosterone — banned for professional athletes in some cases — was found at the scene, only to be later contradicted by the prosecutor's office.


The second day of what was supposed to be a mere bail hearing almost resembled a full-blown trial for the 26-year-old runner, with his lawyer, Barry Roux, tearing into Botha's testimony step by step during cross examination.


Police, Botha acknowledged, left a 9 mm slug from the barrage that killed Reeva Steenkamp inside a toilet and lost track of illegal ammunition found inside the house. And the detective himself walked through the crime scene without wearing protective shoe covers, potentially contaminating the area.


Authorities, Roux asserted, were selectively taking "every piece of evidence to try to extract the most possibly negative connotation and present it to the court."


The case has riveted South Africa, with journalists and the curious crowding into the brick-walled courtroom where Pistorius, dubbed the Blade Runner for his prosthetic legs, faces a charge of premeditated murder in the Valentine's Day slaying.


Pistorius says he mistook Steenkamp for an intruder and shot her out of fear, while prosecutors say he planned the killing and attacked her as she cowered behind a locked bathroom door.


The day seemed to start out well for the prosecution, with Botha offering new details of the shooting that appeared to call into question Pistorius' account of the moments leading up to the 29-year-old model's death.


Ballistic evidence, he said, showed the bullets that killed her had been fired from a height, supporting the prosecution's assertion that Pistorius was wearing prosthetic legs when he took aim at the bathroom door. The athlete has maintained he was standing only on his stumps, and felt vulnerable and frightened as he opened fire from a low position.


Projecting a diagram of the bedroom and bathroom, prosecutor Gerrie Nel said it showed Pistorius had to walk past his bed to get to bathroom and could not have done so without seeing that Steenkamp was not asleep there.


"There's no other way of getting there," Nel said in disputing Pistorius' claim that he had no idea Steenkamp was no longer in bed when he pumped four bullets into the bathroom door, striking her with three.


Botha backed the prosecutor up, saying the holster for Pistorius' 9 mm pistol was found under the left side of the bed, where Steenkamp slept, and it would have been impossible for Pistorius to get the gun without checking to see if she was there.


"I believe that he knew that Reeva was in the bathroom and he shot four shots through the door," the detective said.


Botha described how bullets struck Steenkamp in the head and shattered her right arm and hip, eliciting sobs from Pistorius, who held his head in hands.


However, when asked if Steenkamp's body showed "any pattern of defensive wounds" or bruising from an assault, Botha said "no." He again responded "no" when asked if investigators found anything inconsistent with Pistorius' version of events, though he later said nothing contradicted the police version either.


Testimony began with the prosecutor telling the court that before the shooting, a neighbor heard "nonstop" shouting between 2 a.m. and 3 a.m. at Pistorius' upscale home in a gated community in the capital, Pretoria.


However, Botha later said under cross examination that the witness was in a house 600 yards (meters) away, possibly out of earshot. He cut that estimate in half when questioned again by the prosecutor, as confusion reigned for much of his testimony.


At one point, Botha told the court that police found syringes and two boxes of testosterone in Pistorius' bedroom — testimony the prosecution later withdrew, saying it was too early to identify the substance, which was still being tested.


"It is not certain (what it is) until the forensics" are completed, Medupe Simasiku, a spokesman for South Africa's National Prosecution Agency, told The Associated Press. It's not clear if it was "a legal or an illegal medication for now."


The defense also disputed the claim. "It is an herbal remedy," Roux said. "It is not ... a banned substance."


Still, Botha offered potentially damaging details about Pistorius' past, saying the athlete was once involved in an accidental shooting at a restaurant in Johannesburg and asked someone else "to take the wrap."


The runner also threatened men on two separate occasions, Botha said, allegedly telling one he'd "break his legs."


The detective said police found two iPhones in Pistorius' bathroom and two BlackBerrys in his bedroom, and none had been used to phone for help. Guards at the gated community did call the athlete, Botha said, and all he said was: "I'm all right," as he wept uncontrollably.


Roux later suggested that a fifth phone, not collected by the police, was used by Pistorius to call for help.


The question now is whether Botha's troubled testimony will be enough to convince Chief Magistrate Desmond Nair to keep Pistorius in prison until trial. While Pistorius faces the harshest bail requirements under South African law, the magistrate has said he would consider loosening them based on testimony in the hearing. Final arguments were scheduled for Thursday.


___


Gerald Imray reported from Johannesburg. Associated Press writer Michelle Faul in Johannesburg contributed to this report.


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


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