Wall Street trips and falls on cloudy Italian election

NEW YORK (Reuters) - Stocks on Monday suffered their biggest drop since November after a strong showing in Italian elections by groups opposed to the country's economic reforms triggered worry that Europe's debt problems could once again destabilize the global economy.

The decline marks the biggest percentage drop for the benchmark Standard & Poor's 500 Index since November7, and drove the S&P down to its lowest close since January 18. The CBOE Volatility Index <.vix> or VIX, Wall Street's favorite barometer of fear, surged 34 percent, its biggest jump since August 18, 2011.

Selling accelerated late in the trading session after the S&P 500 fell below the 1,500 level, which has acted as a significant support point. Monday marked the S&P's first close under 1,500 since February 4.

Italy's center-left coalition holds a slim lead over former Prime Minister Silvio Berlusconi's center-right bloc in the election for the lower house of parliament, three TV projections indicated. But any government must also command a majority in the Senate, a race that is decided by region.

The resulting gridlock in parliament could lead to new elections and cast into doubt Italy's ability to pay down its debt.

"Europe hasn't gone away as an issue, it is going to hang around, and it is rearing its ugly head today," said Stephen Massocca, managing director of Wedbush Morgan in San Francisco.

"If someone gets elected who is simply not going to play by the rules, what are they going to do? It puts them in a real quandary here because their financial support, their monetary support is all stipulated by the fact that these austerity programs are going to be in place."

Earlier polls pointing to a center-left victory boosted stocks in Milan and other European markets, and also helped lift the S&P 500 to a session high of 1,525.84 on optimism that Italy would continue down its austerity path.

After a strong start to the year, equities have retreated more recently. The S&P 500's slight fall last week was its first weekly drop after a seven-week string of gains.

In Monday's volatile session, banks and other financial stocks were among the worst performers on worries about the sector's exposure to Italy's massive debt. The KBW Bank Index <.bkx> fell 2.7 percent.

The CBOE Volatility Index <.vix> ended at 18.99, up 34.02 percent.

The Dow Jones industrial average <.dji> dropped 216.40 points, or 1.55 percent, to 13,784.17 at the close. The Standard & Poor's 500 Index <.spx> lost 27.75 points, or 1.83 percent, to 1,487.85. The Nasdaq Composite Index <.ixic> fell 45.57 points, or 1.44 percent, to 3,116.25.

Although the overall market lost ground on Monday, there were a few bright spots.

Barnes & Noble Inc shares shot up 11.5 percent to $15.06 after the bookseller's chairman offered to buy its declining retail business.

Amgen Inc shares climbed 3.1 percent to $89.55, after rival Affymax issued a voluntary recall of its only drug, an anemia treatment that competes with Amgen's top-selling red blood cell booster, Epogen. Affymax shares lost 85.4 percent to $2.42.

The FTSEurofirst-300 index of top European shares <.fteu3> edged up 0.04 percent and Italy's main FTSE MIB <.ftmib> ended up 0.7 percent after earlier gaining nearly 4 percent.

Political uncertainty on the home front, though, is also on Wall Street's mind.

U.S. equities will face a test with the looming debate over so-called sequestration - U.S. government budget cuts that will take effect starting on Friday if lawmakers fail to reach an agreement over spending and taxes. The White House issued warnings about the harm the cuts are likely to inflict on the economy if enacted.

"Sitting out there is the one-thousand-pound gorilla - the sequester issue - and certainly nothing is happening there," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.

Lowe's Companies Inc lost 4.8 percent to $35.86 after the home improvement retailer posted fourth-quarter earnings.

With 83 percent of the S&P 500 companies having reported results so far, 69 percent beat profit expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.

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.

Volume was active with about 7.27 billion shares traded on the New York Stock Exchange, NYSE MKT and Nasdaq, above the daily average of 6.46 billion.

Declining stocks outnumbered advancing ones on both the NYSE and the Nasdaq by a ratio of about 4 to 1.

(Editing by Kenneth Barry, Nick Zieminski and Jan Paschal)

Read More..

AP source: Tom Brady gets 3-year extension

Tom Brady will be a Patriot until he is 40 years old.

Brady agreed to a three-year contract extension with New England on Monday, a person familiar with the contract told The Associated Press. The extension is worth about $27 million and will free up nearly $15 million in salary cap room for the team, which has several younger players it needs to re-sign or negotiate new deals with.

The person spoke on condition of anonymity because the extension has not been announced.

Sports Illustrated first reported the extension.

The 35-year-old two-time league MVP was signed through 2014, and has said he wants to play at least five more years.

A three-time Super Bowl champion, Brady will make far less in those three seasons than the going rate for star quarterbacks. Brady currently has a four-year, $72 million deal with $48 million guaranteed.

Drew Brees and Peyton Manning are the NFL's highest-paid quarterbacks, at an average of $20 million and $18 million a year, respectively.

Brady has made it clear he wants to finish his career with the Patriots, whom he led to Super Bowl wins for the 2001, 2003 and 2004 seasons, and losses in the big game after the 2007 and 2011 seasons. By taking less money in the extension and redoing his current contract, he's hopeful New England can surround him with the parts to win more titles.

Among the Patriots' free agents are top receiver Wes Welker and his backup, Julian Edelman; right tackle Sebastian Vollmer; cornerback Aqib Talib; and running back Danny Woodhead.

Brady has been the most successful quarterback of his era, of course, as well as one of the NFL's best leaders. His skill at running the no-huddle offense is unsurpassed, and he's easily adapted to the different offensive schemes New England has concentrated on through his 13 pro seasons.

The Patriots have gone from run-oriented in Brady's early days to a deep passing team with Randy Moss to an offense dominated by throws to tight ends, running backs and slot receivers.

Brady holds the NFL record for touchdown passes in a season with 50 in 2007, when the Patriots went 18-0 before losing the Super Bowl to the Giants. He has thrown for at least 28 touchdowns seven times and led the league three times.

Last season, Brady had 34 TD passes and eight interceptions as the Patriots went 12-4, leading the league with 557 points, 76 more than runner-up Denver.

Read More..

Vatican 'Gay lobby'? Probably not

STORY HIGHLIGHTS

• Benedict XVI not stepping down under pressure from 'gay lobby,' Allen says


• Allen: Benedict is a man who prefers the life of the mind to the nuts and bolts of government


• However, he says, much of the pope's time has been spent putting out fires

Editor's note: John L. Allen Jr. is CNN's senior Vatican analyst and senior correspondent for the National Catholic Reporter.

(CNN) -- Suffice it to say that of all possible storylines to emerge, heading into the election of a new pope, sensational charges of a shadowy "gay lobby" (possibly linked to blackmail), whose occult influence may have been behind the resignation of Benedict XVI, would be right at the bottom of the Vatican's wish list.

Proof of the Vatican's irritation came with a blistering statement Saturday complaining of "unverified, unverifiable or completely false news stories," even suggesting the media is trying to influence the papal election.

Two basic questions have to be asked about all this. First, is there really a secret dossier about a network of people inside the Vatican who are linked by their sexual orientation, as Italian newspaper reports have alleged? Second, is this really why Benedict XVI quit?

John L. Allen Jr.

The best answers, respectively, are "maybe" and "probably not."

It's a matter of record that at the peak of last year's massive Vatican leaks crisis, Benedict XVI created a commission of three cardinals to investigate the leaks. They submitted an eyes-only report to the pope in mid-December, which has not been made public.

It's impossible to confirm whether that report looked into the possibility that people protecting secrets about their sex lives were involved with the leaks, but frankly, it would be surprising if it didn't.

There are certainly compelling reasons to consider the hypothesis. In 2007, a Vatican official was caught by an Italian TV network on hidden camera arranging a date through a gay-oriented chat room, and then taking the young man back to his Vatican apartment. In 2010, a papal ceremonial officer was caught on a wiretap arranging liaisons through a Nigerian member of a Vatican choir. Both episodes played out in full public view, and gave the Vatican a black eye.

Pope Benedict XVI

HIDE CAPTION

<<

<

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

>

>>

In that context, it would be a little odd if the cardinals didn't at least consider the possibility that insiders leading a double life might be vulnerable to pressure to betray the pope's confidence. That would apply not just to sex, but also potential conflicts of other sorts too, such as financial interests.

Vatican officials have said Benedict may authorize giving the report to the 116 cardinals who will elect his successor, so they can factor it into their deliberations. The most immediate fallout is that the affair is likely to strengthen the conviction among many cardinals that the next pope has to lead a serious house-cleaning inside the Vatican's bureaucracy.

It seems a stretch, however, to suggest this is the real reason Benedict is leaving. For the most part, one should probably take the pope at his word, that old age and fatigue are the motives for his decision.

That said, it's hard not to suspect that the meltdowns and controversies that have dogged Benedict XVI for the last eight years are in the background of why he's so tired. In 2009, at the height of another frenzy surrounding the lifting of the excommunication of a Holocaust-denying traditionalist bishop, Benedict dispatched a plaintive letter to the bishops of the world, voicing hurt for the way he'd been attacked and apologizing for the Vatican's mishandling of the situation.

Even if Benedict didn't resign because of any specific crisis, including this latest one, such anguish must have taken its toll. Benedict is a teaching pope, a man who prefers the life of the mind to the nuts and bolts of government, yet an enormous share of his time and energy has been consumed trying to put out internal fires.

It's hard to know why Benedict XVI is stepping off the stage, but I doubt it is because of a "gay lobby."

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of John L. Allen Jr.

Read More..

Emanuel to critics: McCarthy has my '100 percent support'

Mayor Rahm Emanuel gave Police Superintendent Garry McCarthy his “100 percent support” Monday despite complaints from some aldermen fed up with the department’s inability to bring down violence in their neighborhoods.

The mayor backed up his hand-picked superintendent during his first news conference since African-American aldermen said last week that their constituents are making louder demands that something be done to quash the epidemic of homicides that has drawn nationwide attention to Chicago.

“Both Garry McCarthy, (First Deputy Police Supt.) Al Wysinger and the entire leadership in the police department have my 100 percent support, but they also have my sense of impatience to get the results throughout the city to bring the type of safety we want in every neighborhood,” Emanuel said.

“I appreciate any of the aldermen’s expressions, their frustrations. That is no different than the urgency I want for public safety,” Emanuel said as Ald. Howard Brookins, head of the City Council’s black caucus, looked on.

Last week, Brookins, 21st, questioned McCarthy’s tactics. On Monday, Brookins said he liked the mayor’s urgency. “I think it shows the frustration. I think he captured the mood of the black caucus that we’re all frustrated,” the alderman said. “I’m glad that it’s such a high-level priority for the mayor, as well as all the members of the black caucus.”

But Brookins continued to sound the alarm about the number of killings, which have remained stubbornly high in Chicago even as Emanuel and McCarthy have tried a variety of police tactics and legislative maneuvers in recent months to bring them down.

“I’m not the expert with respect to crime reduction, and I’m a result-oriented guy, as much of my caucus is,” Brookins said. “We just are displaying the frustration that the public is pushing on us about crime within our communities, and primarily it is within African-American communities that we’re seeing this violence.”

The mayor gave his vote of confidence while telling reporters the city has enough money to greatly expand the police department’s “violence prevention initiative,” which pays officers overtime to come in on their days off to work patrol in high crime areas. The Tribune has reported McCarthy plans to double the size of the program to allow up to 400 officers to sign up, and to expand it to every day from five days per week.

“We’re making the right calls and we’re making the right decisions to invest, and it’s an extended period of time but the right call to do and we have the resources to do it. Don’t worry, the budget will be fully balanced as it has been when we proposed it, and we made the cuts where we need to and the investments where we must,” the mayor said.

Emanuel’s 2013 spending plan included a $3 million increase in the department’s overtime to $32 million, according to city budget documents. That's still less than the $33.7 million the department spent on overtime in 2011, documents show.

The mayor’s comments came at a news conference to announce an additional 4,200 children will attend full-day kindergarten next year at a cost of $15 million. That money was found through cost-cutting at the school district’s central office, he said.

Emanuel has in the past used the city’s shaky financial situation to help explain the need to close city-run mental health clinics, lay off city workers and raise water fees and other costs for residents. And Chicago Public Schools officials are on the verge of closing schools to save money over the long haul as they face a deficit of us much as $1 billion next year.

But as with his assurances on police overtime, the mayor said money is available for the kindergarten program. It’s a matter of priorities, he said. “What are your priorities? You’ve got to make them, and then you’ve got to be able to fund them,” he said.

jebyrne@tribune.com

Twitter @_johnbyrne

Read More..

Huge protest vote pushes Italy towards deadlock

ROME (Reuters) - A huge protest vote by Italians enraged by economic hardship and political corruption pushed the country towards deadlock after an election on Monday, with voting projections showing no coalition strong enough to form a government.

With more than two thirds of the vote counted, the projections suggested the center left could have a slim lead in the race for the lower house of parliament.

But no party or likely coalition appeared likely to be able to form a majority in the upper house or Senate, creating a deadlocked parliament - the opposite of the stable result that Italy desperately needs to tackle a deep recession, rising unemployment and a massive public debt.

Such an outcome has the potential to revive fears over the euro zone debt crisis, with prospects of a long period of uncertainty in the zone's third largest economy.

Italian financial markets took fright after rising earlier on hopes for a stable and strong center-left led government, probably backed by outgoing technocrat premier Mario Monti.

The projected result was a stunning success for Genoese comic Beppe Grillo, leader of the populist 5-Star Movement, who toured the country in his first national election campaign hurling obscenity-laced insults against a discredited political class.

With vague election promises and a team of almost totally unknown candidates, the shaggy haired comedian channeled pure public anger against what many see as a sclerotic and useless political system.

The likely result was also a humiliating slap in the face for colorless center-left leader Pier Luigi Bersani, who appeared to have thrown away a 10-point opinion poll lead less than two months ago against Silvio Berlusconi's center right.

Berlusconi, 76, who staged an extraordinary comeback from sex and corruption scandals since diving into the campaign in December, appeared to be leading in the Senate race, but Grillo's projected bloc of Senators would leave him well short of a majority.

Projections gave Bersani's center-left alliance a lead of less than one percentage point in the lower house. If confirmed, that would be enough to control the chamber because of election laws that guarantee a 54 percent majority to the party with the largest share of the vote.

In the Senate the picture was different. The latest projection from RAI state television showed Berlusconi's bloc winning 112 Senate seats, the center-left 105 and Grillo 64, with Monti languishing on only 20 after a failed campaign which never took off. The Senate majority is 158.

Berlusconi, a master politician and communicator, wooed voters with a blitz of television appearances and promises to refund a hated housing tax despite accusations from opponents that this was an impossible vote buying trick.

Grillo has attacked all sides in the campaign and ruled out a formal alliance with any group although it was not immediately known how he would react to his stunning success or how his supporters would behave in parliament.

DANGER OF NEW ELECTION

A bitter campaign, fought largely over economic issues, made some investors fear a return of the kind of debt crisis that took the euro zone close to disaster and brought the technocrat Monti to office, replacing Berlusconi, in 2011.

The projected results showed more than half of Italians had voted for the anti-euro platforms of Berlusconi and Grillo.

Officials from both center and left warned that the looming deadlock could make Italy ungovernable and force new elections.

A center-left government either alone or ruling with Monti had been seen by investors as the best guarantee of measures to combat a deep recession and stagnant growth in Italy, which is pivotal to stability in the currency union.

The benchmark spread between Italian 10-year bonds and their German equivalent widened from below 260 basis points to above 300 and the Italian share index lost all its previous gains after projections of the Senate result.

"These projections suggest that we are heading for an ungovernable situation", said Mario Secchi, a candidate for Monti's centrist movement.

Stefano Fassina, chief economic official for Bersani's center-left, said: "The scenario from the projections we have seen so far suggests there will be no stable government and we would need to return to the polls."

If the results are confirmed the only possibility looks like a "grand coalition" combining right and left, like the one Monti led for a year. But politicians said before the vote this could not work for long and would struggle to work decisively.

Monti helped save Italy from a debt crisis when Rome's borrowing costs were spiraling out of control, but few Italians now see him as the savior of the country, in its longest recession for 20 years.

Grillo's movement rode a huge wave of voter anger about both the pain of Monti's austerity program and a string of political and corporate scandals. It had particular appeal for a frustrated younger generation shut out of full-time jobs.

"I'm sick of the scandals and the stealing," said Paolo Gentile, a 49-year-old Rome lawyer who voted for 5-Star.

"We need some young, new people in parliament, not the old parties that are totally discredited."

Berlusconi, a billionaire media tycoon, exploited anger against Monti's austerity program, accusing him of being a puppet of German Chancellor Angela Merkel, but in many areas Grillo was a bigger beneficiary of public discontent.

Italy desperately needs a strong, reform-minded government to revive growth after two decades of stagnation and address problems ranging from record youth unemployment to a dysfunctional justice system and a bloated public sector.

Italians wrung their hands at prospects of an inconclusive result that will mean more delays to these reforms.

"It's a classic result. Typically Italian. It means the country is not united. It is an expression of a country that does not work. I knew this would happen," said 36-year-old Rome office worker Roberta Federica.

Another office worker, Elisabetta Carlotta, 46, shook her head in disbelief. "We can't go on like this," she said.

(Additional reporting by Stefano Bernabei, Steve Scherer, Gavin Jones, Naomi O'Leary and Giuseppe Fonte in Rome and Lisa Jucca in Milan; Writing by Barry Moody; Editing by Peter Graff)

Read More..

Asian shares edge higher, yen falls on BOJ report

TOKYO (Reuters) - Asian shares edged higher on Monday, with investors still picking up shares battered by last week's steep plunge, while the yen fell to fresh lows on news a reflationary advocate could head the Bank of Japan next month.

The news Japan's government is likely to nominate Asian Development Bank President Haruhiko Kuroda, an advocate of aggressive monetary easing, as its next central bank governor, is set to be a major factor in financial markets this week.

Markets are pondering whether Italy's weekend elections will produce a stable government, and the implications of that for euro zone cohesion, while Moody's credit downgrade on Britain will play on confidence in the pound and government bonds.

Investors also await testimony on Tuesday from Fed Chairman Ben Bernanke for further clues of when the Fed may slow or stop buying bonds. Financial markets were rattled last week after minutes of the Fed's January meeting suggested some Fed officials were mulling scaling back its strong monetary stimulus earlier than expected.

The MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> was up 0.1 percent, pulled higher by Australian shares <.axjo> which gained 0.6 percent on reassuring comments from U.S. Federal Reserve officials on the bank's current stimulus program, which has helped underpin risk sentiment globally.

South Korean shares <.ks11> opened up 0.2 percent, with the nation's new leader, who has shown willingness to talk down the won, being sworn in on Monday.

Tokyo's Nikkei stock average <.n225> opened 1.6 percent higher. <.t/>

Early on Monday, the yen touched its lowest since May 2010 of 94.61 yen against the dollar, while the euro rose to a high of 124.83 yen, still off its 34-month peak of 127.71 set early this month.

The Nikkei newspaper reported the Japanese government is likely to nominate Haruhiko Kuroda and Kikuo Iwata, both vocal advocates of aggressive monetary expansion, as BOJ governor and deputy governor.

The dollar fell sharply to below 93 yen last week on media reports that Toshiro Muto, a former financial bureaucrat perceived as less willing to take unconventional steps, was the frontrunner candidate for the top BOJ job.

"The dollar's move this morning is merely a rebound from disappointment on Muto last week. I don't think this topic will be enough to hoist the dollar above 95 yen," said Hiroshi Maeba, head of FX trading Japan at UBS in Tokyo. "No matter who is elected at the BOJ, it will not affect the longer-term trend of a weak yen," he said.

Speculation over the BOJ has been a key factor driving the yen lower recently due to anticipation for strong reflationary measures, but other fundamental factors such as Japan's deteriorating trade balances and signs of firmer U.S. growth also supported a weakening yen trend.

Abe told Americans on Friday "I am back and so is Japan" and vowed to get the world's third biggest economy growing again.

Investors remained cautious before the full official results of Italy's elections come out on Tuesday, worried a potential political stalemate could impede Rome's progress on fiscal reforms.

The euro was up 0.1 percent to $1.3192, off Friday's six-week low of $1.31445.

Sterling fell to a 31-month low of $1.5073 early on Monday and a record low against the New Zealand dollar at NZ$1.8025 following Friday's one-notch downgrade of Britain's prized triple-A sovereign rating by Moody's.

Investors will also seek signs of recovery from the flash estimate of China's manufacturing PMI from HSBC/Markit due later in the session.

Wall Street ended higher on Friday, boosted strong earnings from Dow component Hewlett-Packard , but the benchmark Standard & Poor's Index <.spx> posted its first weekly decline of the year. European shares rose on Friday after data showed German business morale surged at its fastest pace in over two years in February.

Hedge funds and other big speculators cut their bullish bets on U.S. commodities by nearly $13 billion, the most in about 10 months, in the week to February 19 to $69 billion, just before oil and metals prices tumbled last week on rumors a commodities fund was dumping positions, trade data showed on Friday.

U.S. crude was up 0.1 percent to $93.26 a barrel.

(Editing by Eric Meijer)

Read More..

Johnson wins 2nd Daytona 500; Patrick finishes 8th

DAYTONA BEACH, Fla. (AP) — A big first for Danica Patrick, but an even bigger second for Jimmie Johnson.

Patrick made history up front at the Daytona 500 Sunday, only to see Johnson make a late push ahead of her and reclaim his spot at the top of his sport.

It was the second Daytona 500 victory for Johnson, a five-time NASCAR champion who first won "The Great American Race" in 2006.

"There is no other way to start the season than to win the Daytona 500. I'm a very lucky man to have won it twice," said Johnson, who won in his 400th career start. "I'm very honored to be on that trophy with all the greats that have ever been in our sport."

It comes a year after Johnson completed only one lap in the race because of a wreck that also collected Patrick, and just three months after Johnson lost his bid for a sixth Sprint Cup title to go two years without a championship after winning five straight.

Although he didn't think he needed to send a message to his competitors — "I don't think we went anywhere; anybody in the garage area, they're wise to all that," Johnson said — the win showed the No. 48 team is tired of coming up short after all those years of dominance.

"Definitely a great start for the team. When we were sitting discussing things before the season started, we felt good about the 500," Johnson said, "but we're really excited for everything after the 500. I think it's going to be a very strong year for us."

Patrick is hoping for her own success after a history-making race.

The first woman to win the pole, Patrick also became the first woman to lead the race. She ran inside the top 10 almost the entire race, kept pace with the field and never panicked on the track.

Her only mistakes were on pit road, where she got beat on the race back to the track, and on the final lap, when she was running third but got snookered by the veterans and faded to eighth. That's going to stick with Patrick for some time.

"I would imagine pretty much anyone would be kicking themselves about what they coulda, shoulda have done to give themselves an opportunity to win," she said. "I think that's what I was feeling today, was uncertainty as to how I was going to accomplish that."

There were several multicar crashes, but no one was hurt and none of them approached the magnitude of the wreck that injured more than two dozen fans in the grandstand at the end of the second-tier Nationwide Series race on the same track a day earlier. Daytona International Speedway workers were up until 2 a.m repairing the fence that was damaged in the accident, and track officials offered Sunday morning to move any fans who felt uneasy sitting too close to the track.

Several drivers said the accident and concern for the fans stuck with them overnight and into Sunday morning, and Johnson was quick to send his thoughts from Victory Lane.

"I just want to give a big shout-out to all the fans, and I also want to send my thoughts and prayers out to everybody that was injured in the grandstands," Johnson said.

Dale Earnhardt Jr., whose father was killed in this race 12 years ago, was involved in Saturday's accident but refocused and finished second to Johnson, his Hendrick Motorsports teammate.

"Me personally, I was just really waiting to get the news on how everybody was, how all the fans were overnight, just hoping that things were going to improve," Earnhardt said, adding that he "wasn't really ready to proceed until you had some confirmation that things were looking more positive."

The race itself, the debut for NASCAR's new Gen-6 car, was quite similar to all the other Cup races during Speedweeks in that the cars seemed to line up in a single-file parade along the top groove of the track. It made the 55th running of the Daytona 500 relatively uneventful.

When the race was on the line, Johnson took off.

The driver known as "Five-Time" raced past defending NASCAR champion Brad Keselowski on the final restart and pulled out to a sizable lead that nobody challenged over the final six laps.

Johnson and Keselowski went down to the wire last season in their race for the Sprint Cup title, with Johnson faltering in the final two races as Keselowski won his first Cup championship.

Although it was a bit of an upset that stuck with Johnson into the offseason, it gave him no extra motivation when he found himself racing with Keselowski late Sunday for the Daytona 500.

"As far as racing with Brad out there, you really lose sight of who is in what car," Johnson said. "It's just somebody between you and the trophy. It could have been anybody."

Once Johnson cleared Keselowski on the last restart he had a breakaway lead with Greg Biffle and Patrick behind him. But as the field closed in on the checkered flag, Earnhardt finally made his move, just too late and too far behind to get close enough to the lead.

Earnhardt wound up second for the third time in the last four years. But with all the crashes the Hendrick cars have endured in restrictor-plate races — teammate Kasey Kahne was in the first accident Sunday — team owner Rick Hendrick was just fine with the finish.

"We have a hard time finishing these races. Boy, to run 1-2, man, what a day," Hendrick said. Jeff Gordon, who was a contender early, faded late to 20th.

And Johnson considered himself lucky to be the one holding the trophy at the end.

"Man, it's like playing the lottery; everybody's got a ticket," he said. "I've struck out a lot at these tracks, left with torn-up race cars. Today we had a clean day."

Mark Martin was third in a Michael Waltrip Racing Toyota. Keselowski, who overcame two accidents earlier in the race, wound up fourth in Penske Racing's new Ford. Ryan Newman was fifth in a Chevy for Stewart-Haas Racing and was followed by Roush-Fenway Racing's Greg Biffle, who was second on the last lap but was shuffled back with Patrick to finish sixth.

Regan Smith was seventh for Phoenix Racing, while Patrick, Michael McDowell and JJ Yeley rounded out the top 10.

Patrick was clearly disappointed with her finish. When the race was on the line, she was schooled by Earnhardt, who made his last move and blocked any chance she had.

Still, Patrick became the first woman in history to lead laps in the 500 when she passed Michael Waltrip on a restart on Lap 90. She stayed on the point for two laps, then was shuffled back to third. She ended up leading five laps, another groundbreaking moment for Patrick, who as a rookie in 2005 became the first woman to lead the Indianapolis 500 and now is the 13th driver to lead laps in both the Daytona 500 and the Indy 500.

"Dale did a nice job and showed what happens when you plan it out, you drop back and get that momentum. You are able to go to the front," Patrick said. "I think he taught me something. I'm sure I'll watch the race and there will be other scenarios I see that can teach me, too."

Earnhardt was impressed, nonetheless.

"She's going to make a lot of history all year long. It's going to be a lot of fun to watch her progress," said Earnhardt Jr. "Every time I've seen her in a pretty hectic situation, she always really remained calm. She's got a great level head. She's a racer. She knows what's coming. She's smart about her decisions. She knew what to do today as far as track position and not taking risks. I enjoy racing with her."

Johnson, one of three heavyweight drivers who took their young daughters to meet Patrick — "the girl in the bright green car" — after she won the pole in qualifications, tipped his cap, too.

"I didn't think about it being Danica in the car," Johnson said. "It was just another car on the track that was fast. That's a credit to her and the job she's doing."

The field was weakened by an early nine-car accident that knocked out race favorite Kevin Harvick and sentimental favorite Tony Stewart.

Harvick had won two support races coming into the 500 to cement himself as the driver to beat, but the accident sent him home with a 42nd place finish.

Stewart, meanwhile, dropped to 0-for-15 in one of the few races the three-time NASCAR champion has never won.

"If I didn't tell you I was heartbroken and disappointed, I'd be lying to you," Stewart said.

That accident also took former winner Jamie McMurray, his Chip Ganassi Racing teammate Juan Pablo Montoya, and Kasey Kahne out of contention.

The next accident — involving nine cars — came 105 laps later and brought a thankful end to Speedweeks for Carl Edwards. He was caught in his fifth accident since testing last month, and this wreck collected six other Ford drivers.

The field suddenly had six Toyota drivers at the front as Joe Gibbs Racing and Michael Waltrip Racing drivers took control of the race. But JGR's day blew up — literally — when the team was running 1-2-3 with Matt Kenseth, Denny Hamlin and Kyle Busch setting the pace.

Kenseth, who led a race-high 86 laps, went to pit road first with a transmission issue, and Busch was right behind him with a blown engine. Busch was already in street clothes watching as Hamlin led the field.

"It's a little devastating when you are running 1-2-3 like that," Busch said.

Hamlin's shot disappeared when he found himself in the wrong lane on the final restart. He tried to hook up with Keselowski to get them back to Johnson, but blamed former teammate Joey Logano for ruining the momentum of the bottom lane.

Hamlin offered a backhanded apology to Keselowski on Twitter, posting that he couldn't get close enough because "your genius teammate was too busy messing up the inside line 1 move at a time."

Read More..

Vatican 'Gay lobby'? Probably not

STORY HIGHLIGHTS

• Benedict XVI not stepping down under pressure from 'gay lobby,' Allen says


• Allen: Benedict is a man who prefers the life of the mind to the nuts and bolts of government


• However, he says, much of the pope's time has been spent putting out fires

Editor's note: John L. Allen Jr. is CNN's senior Vatican analyst and senior correspondent for the National Catholic Reporter.

(CNN) -- Suffice it to say that of all possible storylines to emerge, heading into the election of a new pope, sensational charges of a shadowy "gay lobby" (possibly linked to blackmail), whose occult influence may have been behind the resignation of Benedict XVI, would be right at the bottom of the Vatican's wish list.

Proof of the Vatican's irritation came with a blistering statement Saturday complaining of "unverified, unverifiable or completely false news stories," even suggesting the media is trying to influence the papal election.

Two basic questions have to be asked about all this. First, is there really a secret dossier about a network of people inside the Vatican who are linked by their sexual orientation, as Italian newspaper reports have alleged? Second, is this really why Benedict XVI quit?

John L. Allen Jr.

The best answers, respectively, are "maybe" and "probably not."

It's a matter of record that at the peak of last year's massive Vatican leaks crisis, Benedict XVI created a commission of three cardinals to investigate the leaks. They submitted an eyes-only report to the pope in mid-December, which has not been made public.

It's impossible to confirm whether that report looked into the possibility that people protecting secrets about their sex lives were involved with the leaks, but frankly, it would be surprising if it didn't.

There are certainly compelling reasons to consider the hypothesis. In 2007, a Vatican official was caught by an Italian TV network on hidden camera arranging a date through a gay-oriented chat room, and then taking the young man back to his Vatican apartment. In 2010, a papal ceremonial officer was caught on a wiretap arranging liaisons through a Nigerian member of a Vatican choir. Both episodes played out in full public view, and gave the Vatican a black eye.

Pope Benedict XVI

HIDE CAPTION

<<

<

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

>

>>

In that context, it would be a little odd if the cardinals didn't at least consider the possibility that insiders leading a double life might be vulnerable to pressure to betray the pope's confidence. That would apply not just to sex, but also potential conflicts of other sorts too, such as financial interests.

Vatican officials have said Benedict may authorize giving the report to the 116 cardinals who will elect his successor, so they can factor it into their deliberations. The most immediate fallout is that the affair is likely to strengthen the conviction among many cardinals that the next pope has to lead a serious house-cleaning inside the Vatican's bureaucracy.

It seems a stretch, however, to suggest this is the real reason Benedict is leaving. For the most part, one should probably take the pope at his word, that old age and fatigue are the motives for his decision.

That said, it's hard not to suspect that the meltdowns and controversies that have dogged Benedict XVI for the last eight years are in the background of why he's so tired. In 2009, at the height of another frenzy surrounding the lifting of the excommunication of a Holocaust-denying traditionalist bishop, Benedict dispatched a plaintive letter to the bishops of the world, voicing hurt for the way he'd been attacked and apologizing for the Vatican's mishandling of the situation.

Even if Benedict didn't resign because of any specific crisis, including this latest one, such anguish must have taken its toll. Benedict is a teaching pope, a man who prefers the life of the mind to the nuts and bolts of government, yet an enormous share of his time and energy has been consumed trying to put out internal fires.

It's hard to know why Benedict XVI is stepping off the stage, but I doubt it is because of a "gay lobby."

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of John L. Allen Jr.

Read More..

Oscars 2013 live: Rolling out the red carpet

LOS ANGELES -- The Oscars rolled out the red carpet on Sunday for the movie industry's biggest night, with Iran hostage drama "Argo" and presidential drama "Lincoln" in a tight race for Best Picture.

With several contests too close to call, a slate of big box office hits to celebrate and an unpredictable first-time host in Seth MacFarlane, movie fans could be in for surprises when the curtain rises on the 85th annual Academy Awards.

MORE OSCARS: Red carpet pics | Live stream | Oscars trivia quiz

Before the festivities begin, nominees including Jennifer Lawrence, Hugh Jackman, Sally Field, Jessica Chastain, British singer Adele and "Argo" producer George Clooney, along with performers Barbra Streisand and Jennifer Hudson will parade along the 500-ft long (152 meter) red carpet before dozens of photographers and camera crews.

Inside Hollywood's Dolby Theatre, Academy Awards history could be re-written.

Daniel Day-Lewis as U.S. President Abraham Lincoln is considered an unstoppable force to become the first man to win three Best Actor Oscars.

Buzz is building over a possible late upset by France's Emmanuelle Riva, 86, in the Best Actress contest that would make the star of harrowing Austrian entry "Amour" the oldest person ever to win an acting Oscar.

"Lincoln" goes into Sunday's three-hour plus ceremony with a leading 12 nominations, including a directing nod for double Oscar winner Steven Spielberg.

But its front-runner Best Picture status has been dented by the six-week victory streak enjoyed at other Hollywood awards by Ben Affleck's "Argo."

"It's been an interesting year," said Matt Atchity, editor in chief of movie review website Rotten Tomatoes.

"I think 'Argo' probably has the best shot. It's certainly got the momentum. It has won so many top awards, and I think it's probably the movie to beat," Atchity told Reuters.

If "Argo" does prevail for the top prize, it will be the first movie to win Best Picture without its director even getting a nomination since "Driving Miss Daisy" in 1990.

ANNE HATHAWAY OSCAR BOUND

Musical "Les Miserables," comedy "Silver Linings Playbook," shipwreck tale "Life of Pi," Osama bin laden thriller "Zero Dark Thirty," slavery Western "Django Unchained," indie film "Beasts of the Southern Wild," and "Amour" round out the contenders for the best film of 2012.

In other categories, only Anne Hathaway is considered a sure bet to take home a golden statuette after starving herself and chopping off her long brown locks for her supporting turn as tragic heroine Fantine in "Les Miserables."

Awards pundits says Spielberg could lose out in the director's race to Taiwan's Ang Lee for his technical and imaginative feat in filming fantastical adventure "Life of Pi" with a cast of exotic animals.

And the supporting actor Oscar could go to any of the five nominees - Robert De Niro ("Silver Linings Playbook"), Alan Arkin ("Argo"), Christoph Waltz ("Django Unchained"), Tommy Lee Jones ("Lincoln") and Philip Seymour Hoffman ("The Master").

The Oscar winners are chosen in secret ballots by some 5,800 members of the Academy of Motion Picture Arts and Sciences and handed out before an audience of 3,300 guests and tens of millions more watching around the world on television.

After several years of nominating little-seen movies, this year's nine Best Picture contenders have pulled in more than $2 billion in tickets worldwide.

"We are so fortunate to inherit this great group of films that are also popular at the box office ... We just lucked out and had this fantastic year in film," Academy Awards telecast co-producer Neil Meron told Reuters.

Producers are promising a fast-paced show packed with music and big performances. But the man getting the early attention will be MacFarlane, the provocative comedian behind animated TV series "Family Guy" and an unknown quantity as Oscar host.

"We are not going to know what works until we put it out there and see what plays in front of an audience," co-producer Craig Zadan said.

"It's a live show and that is always unpredictable. Once the train has left the station, whatever happens, happens."

Read More..

Cuban leader Raul Castro announces he will retire in 2018

HAVANA (Reuters) - Cuban leader Raul Castro announced on Sunday he would step down from power after his second term as president ends in 2018, and the new parliament named a 52-year-old rising star to become his first vice president and most visible successor.

Castro, 81, made the announcement in a nationally broadcast speech shortly after the Cuban National Assembly elected him to a second five-year term in the opening session of the new parliament.

"This will be my last term," Castro said.

In a surprise move, the new parliament named as his first vice president Miguel Diaz-Canel, a member of the political bureau who rose through the party ranks in the provinces to become the most visible possible successor to Castro. Diaz-Canel would succeed Castro if he cannot serve his full term.

The new government will almost certainly be the last headed up by the Castro brothers and their followers who have ruled Cuba since they swept down from the mountains in the 1959 revolution.

Raul Castro starts his second term immediately, leaving him free to retire in 2018, aged 86.

Former president Fidel Castro joined the meeting, in a rare public appearance. Since falling ill in 2006 and ceding the presidency to his brother, the elder Castro, 86, has given up official positions except as a deputy in the National Assembly.

Governments, Cuba watchers and Cubans were keenly observing to see if any new, and younger, faces might appear among the Council of State members, in particular its first vice president and five vice presidents.

Their hopes were partially fulfilled with Diaz-Canel's ascension. He replaces former first vice president, Jose Machado Ventura, 82, who will continue on as one of five vice presidents. Commander of the Revolution Ramiro Valdes, 80, and Gladys Bejerano, 66, the comptroller general were also re-elected as vice presidents.

Two other newcomers, Mercedes López Acea, 48, first secretary of the Havana communist party, and Salvador Valdes Mesa, 64, head of the official labor federation, also earned vice presidential slots.

Former vice president Esteban Lazo, member of the political bureau of the Communist Party, 68, left his post upon being named parliament president on Sunday, replacing Ricardo Alarcon, who served for 20 years.

Six of the Council's top seven members sit on the party's political bureau which is also lead by Castro.

The National Assembly meets for just a few weeks each year and delegates its legislative powers between sessions to the 31-member Council of State, which also functions as the nation's executive through the Council of Ministers it appoints.

Eighty percent of the 612 deputies, who were elected in an uncontested vote February 3 and with an average age under 50, were born after the Revolution.

(Editing by David Adams, Stacey Joyce and Vicki Allen)

Read More..