Supporters Back Strike at Newspaper in China


James Pomfret/Reuters


Demonstrators gathered outside the headquarters of Southern Weekend Monday in Guangzhou, China.







BEIJING — Hundreds of people gathered outside the headquarters of a newspaper office in southern China on Monday to show their support for journalists who had declared a strike to protest what they called overbearing censorship by provincial propaganda officials.




The journalists, who work for Southern Weekend, a relatively liberal newspaper that has come under increasing pressure from officials in recent years, also received support on the Internet from celebrities and well-known commentators.


“Hoping for a spring in this harsh winter,” Li Bingbing, an actress, said to her 19 million followers on a microblog account. Yao Chen, an actress with more than 31 million followers, cited a quotation by Aleksandr Solzhenitsyn, the Russian Nobel laureate and dissident: “One word of truth outweighs the whole world.”


Many of the people who showed up Monday at the newspaper offices in Guangzhou, the capital of Guangdong Province, carried banners with slogans and white and yellow chrysanthemums, a flower that symbolizes mourning. One banner read: “Get rid of censorship. The Chinese people want freedom.” Police officers watched the protesters without immediately taking any harsh actions.


The angry journalists at Southern Weekend have been calling for the removal of Tuo Zhen, the top propaganda official in Guangdong, whom the journalists blame for overseeing a change in a New Year’s editorial that ran last week and was supposed to have called for greater respect for rights enshrined in the constitution under the headline “China’s Dream, the Dream of Constitutionalism,” according to the China Media Project at the University of Hong Kong. The editorial went through layers of changes and ultimately became one praising the current political system, in which the Communist Party exercises authority over all aspects of governance.


A well-known entrepreneur, Hung Huang, said on her microblog that the actions of a local official had “destroyed, overnight, all the credibility the country’s top leadership had labored to re-establish since the 18th Party Congress,” the November gathering in Beijing that was the climax of the leadership transition.


One journalist for Southern Weekend said Monday afternoon that negotiations between the various parties had been scheduled later in the day, but there were no results from any talks as of Monday evening.


It was unclear how many employees in the newsroom had heeded the calls for a strike. It appeared Sunday that many of Southern Weekend’s reporters had declared themselves on strike. A local journalist who went by the newspaper’s Beijing office on Monday said the building appeared to be open but quiet. One employee told the journalist that the people there were not on strike. Dozens of supporters showed up outside the building at various times, some carrying signs and flowers.


The conflict was exacerbated Sunday night by top editors at the newspaper, who posted a message on the publication’s official microblog saying that the New Year’s editorial had been written with the consent of editors at the newspaper.


According to an account from a newspaper employee posted online on Monday, that statement was made after pressure was exerted on the top editors by Yang Jian, the head of the party committee at Southern Media, the parent company that runs Southern Weekend and other publications. Southern Weekend’s editor in chief, Huang Can, then pressured an employee to give up the official microblog password so the statement could be posted on the microblog.


Neither Mr. Yang nor Mr. Huang could be reached for comment Monday.


Some political analysts have said the conflict raises questions about whether the central government, led by Xi Jinping, the new party chief, will support the idea of a more open media by moving to support the protesting journalists. In his first trip outside Beijing, Mr. Xi traveled to Guangdong and praised the market-oriented economic policies put in place by Deng Xiaoping, the former supreme leader. But more recently, Mr. Xi has said that China must respect its socialist roots.


Resolving the Southern Weekend tensions could also be a test for Hu Chunhua, the new party chief in Guangdong and a potential candidate to succeed Mr. Xi as the leader of China in a decade. Mr. Hu’s predecessor, Wang Yang, was regarded by many Western political analysts as being a “reformer,” but he presided over a tightening of media freedoms in the province and specifically over Southern Media.


On Monday, People’s Daily, the party’s mouthpiece, ran a signed commentary that referred to a recent meeting of propaganda officials in Beijing and said propaganda officials should “follow the rhythm of the times” and help the authorities establish a “pragmatic and open-minded image.” Some people have interpreted that as support for officials in adopting a more enlightened approach in dealing with the news media.


But Global Times, a populist newspaper, ran a scathing editorial that said Southern Weekend was merely a newspaper and should not challenge the system.


“Even in the West, mainstream media would not choose to openly pick a fight with the government,” the editorial said. Xinhua, the state news agency, published the editorial online.


Jonathan Ansfield contributed reporting. Mia Li and Shi Da and contributed research.



This article has been revised to reflect the following correction:

Correction: January 7, 2013

An earlier version of a photo caption with this article misstated the name of a newspaper in China. It is Southern Weekend not Southern Weekly.



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LG kicks off CES with 55-inch ‘ultra-HD’ TV






LAS VEGAS (AP) — LG unveiled a 55-inch TV that sports “ultrahigh-definition” resolution with four times the sharpness of regular HD television sets, kicking off what is likely to be a mini-obsession with the latest super-clear format at the annual International CES gadget show.


The model announced Monday is the smallest in a 2013 lineup that includes 65-inch and 84-inch versions. But the smaller size — and smaller price tag — begins the parade of TV makers that are seeking to bring ultrahigh definition to the masses.






Also known as “4K,” ultrahigh-definition screens are 3,840 pixels wide and 2,160 pixels tall, or more than 8 million in all. The higher resolution will let TV screens get larger without degrading picture quality, though initially the price tag will limit those sets to technology’s early adopters.


LG said the 55-inch and 65-inch versions will be available later this year in the U.S. No price was announced, but it will be less than $ 10,000. The 84-inch version that went on sale late last year cost $ 20,000.


For a few years, though, there won’t likely be a mainstream standard for getting native ultra-HD movies and TV shows to the screen either by disc or broadcast.


LG Electronics Inc. said these new TVs will have upscaling technology that takes images of lesser quality and renders them in high detail. The Korean electronics maker also said it has formed an ultra-HD content agreement with Korea’s top broadcaster, KBS, and is seeking out deals with other global content providers. The company offered no specifics.


LG said that with an ultra-HD TV, it will be possible to play phone games with very sharp resolution and in 3-D. The company said it has been possible to hook up smartphones to the TV to play games with current sets, but the resolution isn’t good.


Along with the lineup of higher-resolution TVs, LG unveiled a new Magic Remote, which acts like a wand that is sensitive to motion and is used to navigate on-screen menus. LG said the new model responds better to natural speech and can be controlled with a single finger rather than “very tiring arm gestures.” It also lets you change the channels by writing numbers in the air.


The company also touted the ability to tap different devices so they can share data. With that capability, you’d be able to see what’s inside your refrigerator while shopping, and you’d be able to monitor how clean your house is getting with cameras on a robotic vacuum. Washing machines will also have such capabilities.


Gadgets News Headlines – Yahoo! News





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Carrie Underwood Tweets Support for Husband Mike Fisher After NHL Lockout Ends















01/07/2013 at 03:00 PM EST







Mike Fisher and Carrie Underwood


Steve Marcus/Landov


Most hockey fans are thrilled the 113-day NHL lockout is over.

Carrie Underwood? Not so much.

Although Underwood – who has been married to professional hockey player Mike Fisher since 2010 – was quick to celebrate her husband's return to the ice, she couldn't help but joke about it.

"Well, folks, hockey is back!" she Tweeted on Sunday. "I just lost my purse holder but gained cheering on my hot husband as he kicks butt! #GoPreds."

While supportive of Fisher's career, the lighthearted Underwood, 29, is anything but quiet when it comes to voicing her opinion on what comes with being married to a hockey player.

Last April, when Fisher, 32, and his Nashville Predators – he was traded from the Ottawa Senators in February of 2011 – made it to the NHL playoffs, Underwood was thrilled for her husband's success, but not for his impending playoff beard.

"[The players] all grow out their facial hair during the playoffs," she told PEOPLE last year. "So before they started, I told Mike, 'You need to shave close.' He always looks good with a little stubble, but it's probably going to get out of hand soon."

It will come even sooner this season as Fisher points out on his site: "It's nice to finally be able to put this behind us and we can finally start thinking about hockey again ... It's going to go by really quickly, and before you know it the playoffs will be starting."

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Organ donations fall in Germany after scandal


BERLIN (AP) — Organ donations have dropped sharply in Germany following a scandal over alleged corruption at several transplant clinics.


The German Foundation for Organ Transplantation says the number of organs donated fell almost 13 percent to 3,917 last year, the lowest figure in a decade.


Several German clinics are being investigated over allegations that doctors manipulated waiting lists to help some patients appear sicker than they were and so receive transplants sooner.


The foundation said Monday that the scandal had "massively shaken" the public's faith in the transplant system.


Some 12,000 people in Germany require organ transplants each year.


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Wall Street retreats from five-year high as focus shifts to earnings

NEW YORK (Reuters) - Stocks fell on Monday as investors cashed in recent gains that lifted the S&P 500 to a five-year high and awaited the start of the fourth-quarter earnings season.


The day's decline was broad across all sectors, but energy and utilities were the top decliners. The S&P 500 energy sector index <.gspe> fell 1 percent and the utilities sector <.gspu> was off 1.2 percent.


Another sector in focus was the financials. Financial stocks fell after a group of major U.S. banks agreed to pay billions in settlement with U.S. regulators.


The KBW bank index <.bkx>, a gauge of U.S. bank stocks, was down 0.7 percent.


Earnings are expected to be only slightly better than the third-quarter's lackluster results, and analysts' current estimates are down sharply from where they were in October.


"There is little doubt that concerns about the fiscal cliff created spending hesitancy in both consumers and businesses in the fourth quarter, and it is likely that will adversely impact earnings season," margins are choppy and cost cuts have run their course, said Randy Frederick, managing director of active trading and derivatives at Charles Schwab.


Aluminum company Alcoa Inc will unofficially launch the reporting season by announcing its results after Tuesday's market close. Alcoa shares were down 1 percent at $9.17.


The Dow Jones industrial average <.dji> was down 76.03 points, or 0.57 percent, at 13,359.18. The Standard & Poor's 500 Index <.spx> was down 8.40 points, or 0.57 percent, at 1,458.07. The Nasdaq Composite Index <.ixic> was down 11.89 points, or 0.38 percent, at 3,089.77.


The day's decline came a session after the S&P 500 finished at a five-year high and investors booked profits on stocks' best weekly gain in more than a year, boosted by a budget deal and economic data. The S&P 500 rose 4.6 percent last week.


Ten mortgage servicers - including Bank of America , Citigroup , JPMorgan , and Wells Fargo - agreed on Monday to pay $8.5 billion to end a case-by-case review of foreclosures required by U.S. regulators.


Bank of America also announced roughly $11.6 billion of settlements with mortgage finance company Fannie Mae and a $1.8 billion sale of collection rights on home loans.


The bank also entered into agreements with Nationstar Mortgage Holdings and Walter Investment Management to sell about $306 billion of residential mortgage servicing rights.


"The settlements may remove any overhang for the stock in the near term, but it only partially satisfies the issue," said Tim Ghriskey, chief investment officer of Solaris Asset Management.


Bank of America shares were down 0.7 percent at $12.02 while Nationstar Mortgage Holdings jumped 12.7 percent to $37.44.


Citigroup shares were down 0.5 percent to $42.20. Wells Fargo shares fell 1.1 percent to $34.55.


Walt Disney Co started an internal cost-cutting review several weeks ago that may include layoffs at its studio and other units, three people with knowledge of the effort told Reuters. Disney shares fell 2.4 percent to $50.95.


Video-streaming service Netflix Inc shares gained 2.3 percent to $98.20 after it said it will carry previous seasons of some popular shows produced by Time Warner's Warner Bros Television.


Amazon.com shares hit their highest price ever at $269.22 after Morgan Stanley raised is rating on the stock. Shares were up 2.8 percent at $266.63.


Major U.S. technology companies could miss estimates for fourth-quarter earnings as budget worries likely led some corporate clients to tighten their belts last month.


(Reporting By Angela Moon; Editing by Kenneth Barry and Nick Zieminski)



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Assad Says Syria ‘Accepts Advice but Not Orders’





BEIRUT, Lebanon — President Bashar al-Assad of Syria, sounding defiant, confident and, to critics, out of touch with the magnitude of his people’s grievances, proposed Sunday what he called a plan to resolve the country’s 21-month uprising with a new constitution and cabinet.




But he offered no new acknowledgment of the gains by the rebels fighting against him, the excesses of his government or the aspirations of the Syrian people. Mr. Assad also ruled out talks with the armed opposition and pointedly ignored its central demand that he step down, instead using much of a nearly hourlong speech to justify his harsh military crackdown.


Mr. Assad waved to a cheering, chanting crowd as he strode to the stage of the Damascus Opera House in the central Umayyad Square — where residents said security forces had been deployed heavily the night before. In his first public speech since June 2012, he repeated his longstanding assertions that the movement against him was driven by “murderous criminals” and terrorists receiving financing from abroad, and he appeared to push back hard against recent international efforts to broker a compromise.


“Everyone who comes to Syria knows that Syria accepts advice but not orders,” he said.


His speech came a week after the United Nations and Arab League envoy on Syria, the senior Algerian diplomat Lakhdar Brahimi, visited Damascus, the capital, in a push for a negotiated solution.


“Who should we negotiate with? Terrorists?” Mr. Assad asked. “We will negotiate with their masters.”


Mr. Assad’s speech was a disappointment for international mediators and many Syrians who say they believe that without a negotiated settlement, Syria’s conflict will descend into an even bloodier stage. The United Nations estimates that more than 60,000 people have died in what began as a peaceful protest movement and transformed into armed struggle after security forces fired on demonstrators.


Rebels have made gains in the north and east of Syria and in the Damascus suburbs, but Mr. Assad’s government has pushed back with devastating airstrikes and artillery bombardments and appears confident that it can hold the capital. Neither side appears ready to give up the prospect of a military victory.


The tenor of Mr. Assad’s speech is likely to raise the question of whether Mr. Brahimi’s mission serves any purpose; there was no immediate comment from him or his staff.


Mr. Assad’s opponents rejected the proposal as meaningless, sticking to their longstanding demand that the president resign as a precondition to negotiations.


“We can’t deal with this murderous regime at all,” George Sabra, a member of the opposition Syrian National Council, said in a brief interview. “This regime has killed 60,000 people, so no one could possibly think that working with this regime is a possibility. It is out of the question.”


Mr. Assad, whose family has ruled Syria for 42 years, said Sunday that he was open to dialogue with “those who have not betrayed Syria,” apparently a reference to tolerated opposition groups that reject armed revolution, like the National Coordination Body for Democratic Change, whose members have been floated by Syria’s allies China and Russia as possible compromise brokers.


Yet Mr. Assad’s speech appeared unlikely to satisfy even those among his opponents who reject the armed rebellion, since it made no apology for the arrests of peaceful activists or for airstrikes that have destroyed neighborhoods. Mr. Assad gave no sign of acknowledging that the movement against him was anything more than a foreign plot or had any goals other than to inflict suffering and destroy the country.


“They killed the intellectuals in order to afflict ignorance on us,” Mr. Assad said. “They attacked the infrastructure in order to make our life difficult, they deprived children from school in order to bring the country backward.”


He added, “The enemies of the people are the enemies of God, and the enemies of God will burn in hell.”


Mr. Assad has framed the uprising as an attack by the West and its allies, and the members of the exile opposition leadership as puppets of their foreign supporters, including Turkey, Qatar, Saudi Arabia and the United States, which has offered what it calls nonlethal support and recognized the main opposition body, now known as the National Coalition of Syrian Revolutionary and Opposition Forces.


Some armed rebel groups have used techniques that randomly target civilians, like car bombs, and there are foreign fighters among the rebels. But most of the armed movement is made up of Syrians who took up arms during the uprising or defected from the armed forces.


In his speech, Mr. Assad thanked officers and conscripts and vowed that he would stay by their side, apparently seeking to dispel speculation that he will flee the country. He spoke against a backdrop of snapshots that was reminiscent of montages that the opposition shows of people killed by the government.


When he finished the crowd chanted, “With our souls, with our blood, we defend you, Assad,” and vowed to be his “shabiha,” the term that has come to designate pro-government militias that have attacked demonstrators.


Scores of people then rushed toward him with an almost aggressive frenzy. Bodyguards pushed them back to form a phalanx that slowly escorted Mr. Assad through the crowd.


Many observers wryly noted on social media that the opera house was a fitting setting for the speech.


“It was operatic in its otherworldly fantasy, unrelated to realities outside the building,” Rami G. Khouri, of the Beirut-based newspaper The Daily Star, wrote on Twitter.


Mr. Assad said the first step in his plan would be for foreign countries to stop financing the rebels; then his government would put down its weapons, he said — although he reserved the right to continue to fight terrorism, which his government has defined as nearly any opponent.


Next would come national dialogue, but only with groups Mr. Assad termed acceptable; then a constitution approved by referendum; then a coalition government. There was no mention of holding elections before Mr. Assad’s term expires in 2014.


Hania Mourtada contributed reporting.



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Kuwaiti gets two years for insulting emir on Twitter






KUWAIT (Reuters) – A Kuwaiti court sentenced a man to two years in prison for insulting the country’s ruler on Twitter, a lawyer following the case said, as the Gulf Arab state cracks down on criticism of the authorities on social media.


According to the verdict on Sunday, published by online newspaper Alaan, a tweet written by Rashid Saleh al-Anzi in October “stabbed the rights and powers of the Emir” Sheikh Sabah al-Ahmad al-Sabah.






Anzi, who has 5,700 Twitter followers, was expected to appeal, the lawyer, who asked not to be named, told Reuters.


Kuwait, a U.S. ally and major oil producer, has been taking a firmer line on politically sensitive comments aired on the Internet.


In June 2012, a man was sentenced to 10 years in prison after he was convicted of endangering state security by insulting the Prophet Mohammad and the Sunni Muslim rulers of Saudi Arabia and Bahrain on social media.


Two months later, authorities detained Sheikh Meshaal al-Malik Al-Sabah, a member of the ruling family, over remarks on Twitter in which he accused authorities of corruption and called for political reform, a rights activist said.


While public demonstrations about local issues are common in a state that allows the most dissent in the Gulf, Kuwait has avoided Arab Spring-style mass unrest that toppled three veteran Arab dictators last year.


But tensions have intensified between the hand-picked government, in which ruling family members hold the top posts, and the elected parliament and opposition groups.


(Reporting by Mahmoud Harbi; Writing by Mahmoud Habboush; Editing by Jason Webb)


Internet News Headlines – Yahoo! News





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Bradley Cooper's Fans Sing 'Happy Birthday' in Palm Springs















01/06/2013 at 03:00 PM EST



Bradley Cooper didn't necessarily have the wildest of birthday celebrations, but his special day certainly didn't go unnoticed.

The Silver Linings Playbook star, who turned 38 on Saturday, was greeted by a slew of screaming fans when he arrived on the red carpet at the 24th Annual Palm Springs International Film Festival Awards Gala in Palm Springs, Calif.

"Bradley started interacting with his fans and then they broke out into song, chanting 'Happy birthday to you,'" an onlooker tells PEOPLE.

Running late into the event because of the fan holdup, Cooper whisked by many of the reporters, and when asked about his birthday plans, answered with a smile, "I'm here!"

But the birthday surprises didn't end there.

After being honored with a Desert Palm Achievement Award presented by Playbook director David O. Russell, PEOPLE's former Sexiest Man Alive was given a shoutout by event host Mary Hart, who insisted the entire room sing "Happy Birthday" to the actor.

"It seemed very unexpected," the onlooker adds. "He seemed a little shy and embarrassed by it, but while managing to smile still."

– Dahvi Shira


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Your medical chart could include exercise minutes


CHICAGO (AP) — Roll up a sleeve for the blood pressure cuff. Stick out a wrist for the pulse-taking. Lift your tongue for the thermometer. Report how many minutes you are active or getting exercise.


Wait, what?


If the last item isn't part of the usual drill at your doctor's office, a movement is afoot to change that. One recent national survey indicated only a third of Americans said their doctors asked about or prescribed physical activity.


Kaiser Permanente, one of the nation's largest nonprofit health insurance plans, made a big push a few years ago to get its southern California doctors to ask patients about exercise. Since then, Kaiser has expanded the program across California and to several other states. Now almost 9 million patients are asked at every visit, and some other medical systems are doing it, too.


Here's how it works: During any routine check of vital signs, a nurse or medical assistant asks how many days a week the patient exercises and for how long. The number of minutes per week is posted along with other vitals at the top the medical chart. So it's among the first things the doctor sees.


"All we ask our physicians to do is to make a comment on it, like, 'Hey, good job,' or 'I noticed today that your blood pressure is too high and you're not doing any exercise. There's a connection there. We really need to start you walking 30 minutes a day,'" said Dr. Robert Sallis, a Kaiser family doctor. He hatched the vital sign idea as part of a larger initiative by doctors groups.


He said Kaiser doctors generally prescribe exercise first, instead of medication, and for many patients who follow through that's often all it takes.


It's a challenge to make progress. A study looking at the first year of Kaiser's effort showed more than a third of patients said they never exercise.


Sallis said some patients may not be aware that research shows physical inactivity is riskier than high blood pressure, obesity and other health risks people know they should avoid. As recently as November a government-led study concluded that people who routinely exercise live longer than others, even if they're overweight.


Zendi Solano, who works for Kaiser as a research assistant in Pasadena, Calif., says she always knew exercise was a good thing. But until about a year ago, when her Kaiser doctor started routinely measuring it, she "really didn't take it seriously."


She was obese, and in a family of diabetics, had elevated blood sugar. She sometimes did push-ups and other strength training but not anything very sustained or strenuous.


Solano, 34, decided to take up running and after a couple of months she was doing three miles. Then she began training for a half marathon — and ran that 13-mile race in May in less than three hours. She formed a running club with co-workers and now runs several miles a week. She also started eating smaller portions and buying more fruits and vegetables.


She is still overweight but has lost 30 pounds and her blood sugar is normal.


Her doctor praised the improvement at her last physical in June and Solano says the routine exercise checks are "a great reminder."


Kaiser began the program about three years ago after 2008 government guidelines recommended at least 2 1/2 hours of moderately vigorous exercise each week. That includes brisk walking, cycling, lawn-mowing — anything that gets you breathing a little harder than normal for at least 10 minutes at a time.


A recently published study of nearly 2 million people in Kaiser's southern California network found that less than a third met physical activity guidelines during the program's first year ending in March 2011. That's worse than results from national studies. But promoters of the vital signs effort think Kaiser's numbers are more realistic because people are more likely to tell their own doctors the truth.


Dr. Elizabeth Joy of Salt Lake City has created a nearly identical program and she expects 300 physicians in her Intermountain Healthcare network to be involved early this year.


"There are some real opportunities there to kind of shift patients' expectations about the value of physical activity on health," Joy said.


NorthShore University HealthSystem in Chicago's northern suburbs plans to start an exercise vital sign program this month, eventually involving about 200 primary care doctors.


Dr. Carrie Jaworski, a NorthShore family and sports medicine specialist, already asks patients about exercise. She said some of her diabetic patients have been able to cut back on their medicines after getting active.


Dr. William Dietz, an obesity expert who retired last year from the Centers for Disease Control and Prevention, said measuring a patient's exercise regardless of method is essential, but that "naming it as a vital sign kind of elevates it."


Figuring out how to get people to be more active is the important next step, he said, and could have a big effect in reducing medical costs.


___


Online:


Exercise: http://1.usa.gov/b6AkMa


___


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


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"Cliff" concerns give way to earnings focus

NEW YORK (Reuters) - Investors' "fiscal cliff" worries are likely to give way to more fundamental concerns, like earnings, as fourth-quarter reports get under way next week.


Financial results, which begin after the market closes on Tuesday with aluminum company Alcoa , are expected to be only slightly better than the third-quarter's lackluster results. As a warning sign, analyst current estimates are down sharply from what they were in October.


That could set stocks up for more volatility following a week of sharp gains that put the Standard & Poor's 500 index <.spx> on Friday at the highest close since December 31, 2007. The index also registered its biggest weekly percentage gain in more than a year.


Based on a Reuters analysis, Europe ranks among the chief concerns cited by companies that warned on fourth-quarter results. Uncertainty about the region and its weak economic outlook were cited by more than half of the 25 largest S&P 500 companies that issued warnings.


In the most recent earnings conference calls, macroeconomic worries were cited by 10 companies while the U.S. "fiscal cliff" was cited by at least nine as reasons for their earnings warnings.


"The number of things that could go wrong isn't so high, but the magnitude of how wrong they could go is what's worrisome," said Kurt Winters, senior portfolio manager for Whitebox Mutual Funds in Minneapolis.


Negative-to-positive guidance by S&P 500 companies for the fourth quarter was 3.6 to 1, the second worst since the third quarter of 2001, according to Thomson Reuters data.


U.S. lawmakers narrowly averted the "fiscal cliff" by coming to a last-minute agreement on a bill to avoid steep tax hikes this weeks -- driving the rally in stocks -- but the battle over further spending cuts is expected to resume in two months.


Investors also have seen a revival of worries about Europe's sovereign debt problems, with Moody's in November downgrading France's credit rating and debt crises looming for Spain and other countries.


"You have a recession in Europe as a base case. Europe is still the biggest trading partner with a lot of U.S. companies, and it's still a big chunk of global capital spending," said Adam Parker, chief U.S. equity strategist at Morgan Stanley in New York.


Among companies citing worries about Europe was eBay , whose chief financial officer, Bob Swan, spoke of "macro pressures from Europe" in the company's October earnings conference call.


REVENUE WORRIES


One of the biggest worries voiced about earnings has been whether companies will be able to continue to boost profit growth despite relatively weak revenue growth.


S&P 500 revenue fell 0.8 percent in the third quarter for the first decline since the third quarter of 2009, Thomson Reuters data showed. Earnings growth for the quarter was a paltry 0.1 percent after briefly dipping into negative territory.


On top of that, just 40 percent of S&P 500 companies beat revenue expectations in the third quarter, while 64.2 percent beat earnings estimates, the Thomson Reuters data showed.


For the fourth quarter, estimates are slightly better but are well off estimates for the quarter from just a few months earlier. S&P 500 earnings are expected to have risen 2.8 percent while revenue is expected to have gone up 1.9 percent.


Back in October, earnings growth for the fourth quarter was forecast up 9.9 percent.


In spite of the cautious outlooks, some analysts still see a good chance for earnings beats this reporting period.


"The thinking is you need top line growth for earnings to continue to expand, and we've seen the market defy that," said Mike Jackson, founder of Denver-based investment firm T3 Equity Labs.


Based on his analysis, energy, industrials and consumer discretionary are the S&P sectors most likely to beat earnings expectations in the upcoming season, while consumer staples, materials and utilities are the least likely to beat, Jackson said.


Sounding a positive note on Friday, drugmaker Eli Lilly and Co said it expects profit in 2013 to increase by more than Wall Street had been forecasting, primarily due to cost controls and improved productivity.


(Reporting By Caroline Valetkevitch; Editing by Kenneth Barry)



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