Slain girl made anti-gang video









The sixth-grader can barely keep from smiling, self-conscious in front of the camera as she delivers a very serious message.

"Hi, my name is Hadiya. This commercial is informational for you and your future children," she begins. "So many children out there are in gangs and it's your job as students to say no to gangs and yes to a great future."






The video then shows shots of a boy slumped in a stairwell, another boy sprawled against a locker, a girl lying on the floor against a wall as a classmate next to Hadiya says, "So many children in the world have died from gang violence. More than 500 children have died from being in the wrong place at the wrong time."

Four years after Hadiya Pendleton made that public service video at Carter G. Woodson Elementary School, police are saying the same thing about her.

Hadiya had just finished her final exams at King Prep High School, where she was a sophomore, and was hanging out with friends from the school's volleyball team when she was gunned down in a park in the 4400 block of South Oakenwald Avenue.

Hadiya and the others had sought shelter from a rainstorm under a canopy at the park around 2:20 p.m. Tuesday when a gunman jumped a fence, ran toward them and opened fire, police said.

As the teens scattered, Hadiya and two teenage boys were shot. Hadiya was hit in the back and pronounced dead at Comer Children's Hospital less than an hour after the shooting. The wounds suffered by the boys were not life-threatening.

Police Superintendent Garry McCarthy stressed that neither Hadiya nor anyone in the group she was with were involved with gangs. But it appears the gunman mistook the students for members of a rival gang, he said. The shooter was last seen fleeing in a white Nissan.

“These were good kids by everything that I learned," McCarthy said at a Wednesday news conference, where a reward of $11,000 was announced. "Wrong place at the wrong time.”

Hadiya was shot a little more than a week after performing with the King College Prep band in Washington during President Barack Obama's inauguration festivities. The shooting occurred in a park about a mile north of Obama's Kenwood home.

The shooting has drawn the attention of both the White House, which is pushing for national gun control, and City Hall as Chicago closes on a violent January. Hadiya was the 42nd homicide victim this year in the city, where killings last year climbed above 500.

Hadiya's father, Nathaniel Pendleton, pleaded for someone to step forward and bring the 15-year-old's killer to justice.

"She was destined for great things," he said.

Hadiya was a majorette with the band at King, one of the city's elite selective-enrollment schools. She dreamed of going to Northwestern University and talked about becoming a pharmacist or a journalist, maybe a lawyer.

Police have reported no arrests.



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Syria warns of "surprise" response to Israel attack


BEIRUT/AMMAN (Reuters) - Syria warned on Thursday of a possible "surprise" response to Israel's attack on its territory and Russia condemned the air strike as an unprovoked violation of international law.


Damascus could take "a surprise decision to respond to the aggression of the Israeli warplanes", Syrian ambassador to Lebanon Ali Abdul-Karim Ali said a day after Israel struck against Syria.


"Syria is engaged in defending its sovereignty and its land," Ali told a website of the Lebanese militant group Hezbollah. Syria and Israel have fought several wars and in 2007 Israeli jets bombed a suspected Syrian nuclear site, without a military response from Damascus.


Diplomats, Syrian rebels and regional security sources said on Wednesday that Israeli jets had bombed a convoy near the Lebanese border, apparently hitting weapons destined for Hezbollah. Syria denied the reports, saying the target had been a military research center northwest of Damascus.


Hezbollah, which has supported Syrian President Bashar al-Assad as he battles an armed uprising in which 60,000 people have been killed, said Israel was trying to thwart Arab military power and vowed to stand by its ally.


"Hezbollah expresses its full solidarity with Syria's leadership, army and people," said the group which fought an inconclusive 34-day war with Israel in 2006.


Israel has remained silent on the attack and there has been little reaction from its Western backers, but Syria's allies in Moscow and Tehran were quick to denounce the strike.


Russia, which has blocked Western efforts to put pressure on Syria at the United Nations, said that any Israeli air strike would amount to unacceptable military interference.


"If this information is confirmed, then we are dealing with unprovoked attacks on targets on the territory of a sovereign country, which blatantly violates the U.N. Charter and is unacceptable, no matter the motives to justify it," the Foreign Ministry said in a statement.


Iranian deputy foreign minister Hossein Amir Abdullahian said the attack "demonstrates the shared goals of terrorists and the Zionist regime", Fars news agency reported. Assad portrays the rebels fighting him as foreign-backed, Islamist terrorists, with the same agenda as Israel.


"It is necessary for the sides which take tough stances on Syria to now take serious steps and decisive stances against this aggression by Tel Aviv and uphold criteria for security in the region," Abdullahian said.


An aide to Supreme Leader Ayatollah Ali Khamenei said on Saturday that Iran would consider any attack on Syria as an attack on itself, but Abdullahian made no mention of retaliation.


Hezbollah said the attack showed that the conflict in Syria was part of a scheme "to destroy Syria and its army and foil its pivotal role in the resistance front (against Israel)".


BLASTS SHOOK DISTRICT


Details of Wednesday's strike remain sketchy and, in parts, contradictory. Syria said Israeli warplanes, flying low to avoid detection by radar, crossed into its airspace from Lebanon and struck the Jamraya military research centre.


But the diplomats and rebels said the jets hit a weapons convoy heading from Syria to Lebanon, apparently destined for Assad's ally Hezbollah, and the rebels said they - not Israel - hit Jamraya with mortars.


The force of the dawn attack shook the ground, waking nearby residents from their slumber with up to a dozen blasts, two sources in the area said.


"We were sleeping. Then we started hearing rockets hitting the complex and the ground started shaking and we ran into the basement," said a woman who lives adjacent to the Jamraya site.


The resident, who declined to be named because of the sensitivity over Israel's reported strike on Wednesday morning, said she could not tell whether the explosions which woke her were the result of an aerial strike.


Another source who has a relative working inside Jamraya reported that a building inside the complex had been cordoned off after the attack and that flames were seen rising from the area after the attack.


"It appears that there were about a dozen rockets that appeared to hit one building in the complex," the source, who also asked not to be identified, told Reuters. "The facility is closed today."


Israeli newspapers quoted foreign media on Thursday for reports on the attack. Journalists in Israel are required to submit articles on security and military issues to the censor, which has the power to block any publication of material it deems could compromise state security.


Syrian state television said two people were killed in the raid on Jamraya, which lies in the 25-km (15-mile) strip between Damascus and the Lebanese border. It described it as a scientific research centre "aimed at raising the level of resistance and self-defense".


Diplomatic sources from three countries told Reuters that chemical weapons were believed to be stored at Jamraya, and that it was possible that the convoy was near the large site when it came under attack. However, there was no suggestion that the vehicles themselves had been carrying chemical weapons.


"The target was a truck loaded with weapons, heading from Syria to Lebanon," said one Western diplomat, echoing others who said the convoy's load may have included anti-aircraft missiles or long-range rockets.


The raid followed warnings from Israel that it was ready to act to prevent the revolt against Assad leading to Syria's chemical weapons and modern rockets reaching either his Hezbollah allies or his Islamist enemies.


A regional security source said Israel's target was weaponry given by Assad's military to fellow Iranian ally Hezbollah.


"This episode boils down to a warning by Israel to Syria and Hezbollah not to engage in the transfer of sensitive weapons," the source said. "Assad knows his survival depends on his military capabilities and he would not want those capabilities neutralized by Israel - so the message is this kind of transfer is simply not worth it, neither for him nor Hezbollah."


Such a strike or strikes would fit Israel's policy of pre-emptive covert and overt action to curb Hezbollah and does not necessarily indicate a major escalation of the war in Syria. It does, however, indicate how the erosion of the Assad family's rule after 42 years is seen by Israel as posing a threat.


Israel this week echoed concerns in the United States about Syrian chemical weapons, but its officials say a more immediate worry is that the civil war could see weapons that are capable of denting its massive superiority in airpower and tanks reaching Hezbollah; the group fought Israel in 2006 and remains a more pressing threat than its Syrian and Iranian sponsors.


(Additional reporting by Mariam Karouny and Oliver Holmes in Beirut, Gabriela Baczynska in Moscow and Marcus George in Dubai; editing by David Stamp)



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Wall Street flat ahead of Fed after GDP shock

NEW YORK (Reuters) - Stocks were little changed on Wednesday as data showing the economy unexpectedly contracted in the fourth quarter was offset by upbeat parts of the report and strong results from Boeing and Amazon.


Economists stressed that the 0.1 percent contraction in U.S. gross domestic product, caused partly by a plunge in government spending and lower business inventories, is not an indicator of recession.


"Inventories came down and that subtraction is actually positive for the private sector," said Jim Russell, chief equity strategist for U.S. Bank Wealth Management in Cincinnati.


"A lot of the important components going forth are there, like consumption by individuals and capital spending, and they are looking strong."


Wall Street opened slightly higher despite the GDP data, with traders awaiting a statement from the Federal Reserve after its two-day policy-setting meeting. The Fed is expected to keep monetary policy on a steady, accommodative path, though debate continues over when it should curtail its bond-buying program.


The S&P 500 held above 1,500, seen by technical analysts as an inflection point that will determine the overall direction in the near term. The index is on track to post its best month since October 2011 and its best January since 1997.


"This is a very modest pullback after a steep run," said Paul Zemsky, head of asset allocation at ING Investment Management in New York.


"It is too soon for the Fed to start talking about the end of (their bond buying program); the economy needs stimulus to sustain this recovery."


The Dow Jones industrial average <.dji> rose 0.27 points or 0 percent, to 13,954.69, the S&P 500 <.spx> lost 1.04 points or 0.07 percent, to 1,506.8 and the Nasdaq Composite <.ixic> dropped 0.11 points or -0 percent, to 3,153.55.


Both Boeing Co and Amazon.com shares gained after earnings beat expectations, continuing a trend this quarter of high-profile names advancing after results.


Amazon rose 5.4 percent to $274.40 and Boeing rose 1.2 percent to $74.54.


Thomson Reuters data showed that of the 192 companies in the S&P 500 that have reported earnings this season 68.8 percent have been above analyst expectations, which is a higher proportion than over the past four quarters and above the average since 1994.


Chesapeake Energy rose 6.5 percent to $20.20 a day after it said Aubrey McClendon would step down as chief executive. The last year has been marked by civil and criminal probes into the second-largest U.S. natural gas producer.


Research In Motion shares fell 5.7 percent to $14.76 after the company, which is changing its name to BlackBerry, unveiled a long-delayed line of smartphones in hopes of a comeback into a market it once dominated.


Giving the market extra support, private sector employment topped forecasts with the ADP National Employment report showing 192,000 jobs added in January, higher than the 165,000 expectation.


(Reporting by Rodrigo Campos; Editing by Kenneth Barry and Nick Zieminski)



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Lewis tells Harbaugh 'nothing to' report


NEW ORLEANS (AP) — Ravens coach John Harbaugh says star linebacker Ray Lewis assured him "there's nothing to" a magazine report linking him to a company that makes deer-antler spray containing a banned performance enhancer.


Harbaugh said Wednesday morning he spoke with Lewis. The coach said Lewis "knows there is nothing to it. He understands it's something he's never been involved in."


On Tuesday, Sports Illustrated reported that Lewis sought help from a company that makes the unorthodox product to speed his recovery from a torn right triceps. Lewis missed 10 games with the injury.


"He laughed about it," Harbaugh said, referring to Lewis. "He told me there's nothing to it. He's told us in the past and now that he has never taken any of it."


Baltimore plays the San Francisco 49ers in the Super Bowl on Sunday in the final game of Lewis' career.


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NASA Launching New Communications Satellite Today






NASA plans to launch a new satellite today (Jan. 30) to upgrade the network used to send messages back and forth between spacecraft and the ground.


The space agency is set to launch the new Tracking and Data Relay Satellite K (TDRS-K for short) at 8:48 p.m. EST (0148 Jan. 31 GMT) today from Cape Canaveral Air Force Station in Florida. The spacecraft will blast off atop a United Launch Alliance Atlas 5 rocket.






You can watch the launch live on SPACE.com through NASA TV starting at 6:15 p.m. ET (1115 GMT).


Cold front


Weather at the launch site is looking promising, but NASA officials aren’t taking any chances, and won’t launch the rocket unless skies are clear.


“Now we’re looking at a 40-percent chance that a weather rule will be violated,” Joel Tumbiolo, a NASA launch weather officer, said on Monday.


The rocket that will carry TDRS-K to orbit has already been rolled out onto the launch pad, but a cold front is approaching Cape Canaveral that could delay the launch. Electrically active clouds heralding the arrival of the cold front might create dangerous conditions.


TDRS-K has an estimated cost of between $ 350 million and $ 400 million, not counting the cost of the rocket to launch it. The spacecraft is the first of three new satellites due to lift off between now and 2015 to bolster the TDRS communications satellite network, which relays data and messages between spacecraft in orbit and ground stations. [NASA's New Comsat: TDRS-K Spacecraft in Photos]


Thanks to the positioning of ground elements and the TDRS network of satellites around the world, NASA scientists have constant communication with orbiting spacecraft. The network is responsible for space-to-ground communication with the International Space Station as well as the Hubble Space Telescope.


Orbital network


The TDRS-K satellite is expected last at least 15 years in orbit. It is the 11th TDRS spacecraft to launch since the network was started in 1983. Today, five satellites are in active service, but one might be retired once TDRS-K is placed in orbit, said Badri Younes, a scientist in NASA’s Space Communications and Navigation office.


The Atlas 5 rocket will boost the new satellite into an orbit 22,300 miles (35,888 kilometers) high, where it will join a network of other relay spacecraft above the planet. Once out of Earth’s atmosphere, the rocket’s main engine will separate and fall away, leaving a second-stage centaur rocket engine to carry the 26.7-foot-tall (8 meters) satellite into orbit.


The TDRS-K has two insect-like antennas that are folded during launch. Once the satellite detaches from the rocket’s second stage, its antennas will pop out into a bowl shape. After 10 days of maneuvering into its proper orbit, TDRS-K’s two solar arrays will unfurl and the antennas will lock into place.


After launch, NASA will test the satellite for three months to make sure everything is in working order. Once those tests are complete, the TDRS team will decide if the satellite is ready for service (if not, it will be moved to a backup position).


Follow Miriam Kramer on Twitter @mirikramer or SPACE.com @Spacedotcom. We’re also on Facebook & Google+


Copyright 2013 SPACE.com, a TechMediaNetwork company. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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BlackBerry must remember strengths




BlackBerry CEO Thorsten Heins displays one of the new Blackberry 10 smartphones at the product launch January 30.




STORY HIGHLIGHTS


  • BlackBerry sales have slumped in the U.S. but is still strong in emerging markets

  • New models launched should remember why they are popular in developing world

  • In places like Brazil and South Africa, the 10 is the update to their current phone

  • in Sub-Saharan Africa there is expected to be 175 million new customers in the next 3 years




Watch Jim Clancy on CNN International's "The Brief" at 4p.m. ET GMT Friday.


(CNN) -- BlackBerry's loss of market share in the U.S. is the stuff of legends. Last fall, it was estimated only about 2% of American phone users were still carrying their BlackBerry mobile with its iconic keypad.


But consider this: sub-Saharan Africa is expected to add 175 million new mobile users in just the coming 3 years. That's according to the GSMA, which represents the world's mobile operators.


"Mobile has already revolutionized African society and yet demand still continues to grow by almost 50 percent a year," said Tom Phillips, Chief Government and Regulatory Affairs Officer, GSMA.


That could be good news indeed for BlackBerry. Research in Motion, the maker of BlackBerry, estimates it holds a 70% market share in countries like South Africa.


The company's new phones, announced this week, are not the ones some of its best customers in emerging markets would like to buy. They're too expensive. But Research in Motion -- which also this week changed its company name to BlackBerry -- is pledging some of its six new models will address that.


While millions in China, Europe and the U.S. have adopted Android or iOS smartphones with a vengeance, millions more users in emerging markets are enthused about what's in store for the new BlackBerry 10. It's the update for what many of them are already using.






They live in countries like Brazil, Malaysia, Nigeria, Kenya and South Africa. They have embraced the BlackBerry for a combination of factors that all point to the different way mobile devices are used.


Unlike their counterparts in Europe and America, the mobile in their pocket is more likely to be their primary link to the internet.


BlackBerry Messenger is the connection that allows these users unlimited conversations without paying charges for SMS data. While young, brand-conscious Chinese may be willing to part with several months' salary to buy the latest iPhone, African users are looking for more practical (and cheaper) connections.


What separates developed countries from their developing counterparts at street level can be summed up in a single word: infrastructure.


Isobel Coleman, senior fellow and Director of the Civil Society, Markets and Democracy Initiative at the Council on Foreign Relations, says mobile technology has proved it can bridge the gap where infrastructure is lacking.


"It's a culture, it's an economy, it's innovation, education, healthcare, it's all of these things," says Coleman.


You can take that to the bank. For many Africans, their cell phone account is the first bank account they've ever owned.


In emerging markets, mobile phone banking is growing because of the lack of infrastructure. Fewer bank branches often mean long distances to travel and long lines once you've arrived.


Africans are expected to transfer more than $200 billion per year or 18% of the continent's GDP by 2015.


Oh, and that keyboard. No matter where you are in the world, there will always be a demand for a keyboard that clicks. The company appears to understand that as BlackBerry 10 models come with both soft keypads and the traditional BlackBerry buttons.


I asked some of my Twitter followers to weigh in on the BlackBerry 10 roll out. While some said Android or Apple's iOS were in their future plans, many others expressed continued enthusiasm for the BlackBerry.


Soji, a pianist and teacher in Nigeria tweeted back "I'm falling in love with this BB. Cheaper to own."


From Kuala Lumpur, Amir wrote "I need a physical keyboard to type while also having a touch-screen for photos etc. Security factor also important."


Hans-Eric from South Africa reinforced the sentiments of many mobile users in emerging markets: "The cost of data is simply too high without it (BlackBerry.)"


The voices from emerging markets couldn't have been clearer. What they expect from BlackBerry 10 is a stronger, longer lasting battery, durability and continued low cost connectivity.


CFR's Coleman agrees that BlackBerry (and anyone else) trying to win and hold this mobile device sector has to understand how these devices are being used and give the customers what they want.


"Cheap. Rugged. Not too many bells and whistles. Practical."


There is little doubt smartphones are changing the way people use the internet, how they bank, shop and interact socially.


But it's worth keeping in perspective that in a world where there are now an estimated 1 billion smartphones, there are 5 billion feature phone users. That's a lot of upside growth potential for BlackBerry and all the other players out there.







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Girl fatally shot a week after appearing at inauguration

A 15-year-old girl who had recently taken part in inauguration events in Washington was shot to death after leaving her South Side school Tuesday.









Hadiya Pendleton was such a whirlwind of activity — from preparing to travel abroad to performing at President Barack Obama’s inauguration festivities — that family members would jokingly tell the 15-year-old to slow down.

"There were a lot of good opportunities that were coming her way. She was just taking them all,” said Lakeisha Stewart, 37, Hadiya’s godmother. "She was the kid who you had to say, ‘Slow down, you can’t do everything.' "






Pendleton was hanging out with her volleyball team near King College Prep on the South Side Tuesday afternoon when she was fatally shot in the back when a gunman filed into a crowd of students, according to family and police.

“All of it just makes no sense,” Stewart said. “She was following (her parents') rules.”

Just last week, at President Barack Obama’s inauguration, Hadiya sent her godparents a text and a photo of her and her teammates in Washington, D.C., Stewart said.  She had not gotten the chance to talk to Hadiya about the details of the trip since she returned from the East Coast.

Hadiya, who has a 10-year-old brother, had also been preparing to travel to Paris with her school, Stewart said, and loved to dance. She was a majorette on the school's drill team.

Hadiya’s parents made sure she stayed involved in school, said her godfather, Damon Stewart, 36, an attorney and Chicago police officer. He said she was in the wrong place at the wrong time.

“He life was dominated by her activities and the things she was into,” he said.

“I’ve known this little girl her entire life," added Lakeisha Stewart. "I can’t think of a moment that this child did anything wrong. She always strived to do the right thing."

At King, Bria Carter and two friends said the halls of the school were unusually quiet as students mourned Hadiya’s death.

"People are crying at school," said Carter, 17, a friend of Hadiya. "Those who knew her are so hurt.

"She was an amazing person -- always positive," Carter said. "She was one of those people everyone loved. She was the sweetest thing."

Brothers Addison and Zion Morgan said many of their classmates took to social media Tuesday night to express their emotions.

"Based off of the tweets, everyone is surprised and shocked by this," said senior Addison Morgan, 17.

Freshman Zion Morgan, 15, said he was in a U.S. History class with Hadiya.  "She was always smiling," Zion Morgan said. "She would always raise her hand in class."

Hadiya and a group of others had decided to hang out at Harsh Park about three blocks of the school Tuesday after taking their exams. About a dozen teens had taken shelter under a canopy during a rainstorm when a boy or man jumped a fence in the park, ran toward them and opened fire around 2:20 p.m., police said.

Hadiya was wounded in the back and a 16-year-old boy -- also a student at King -- was shot in the leg, police said.

The attacker got into an auto and fled, police said. No arrests have been reported.

At the park Wednesday, neighbors along the well-maintained North Kenwood block could not remember any trouble there before.

The small park's bright blue and orange playground equipment is often used by toddlers down the street, a neighbor said, but otherwise remains quiet.

The neighbor, who declined to be named, lives next door to the park and said it's a "perfect neighborhood."

Teens and older children are not often visitors of the park, he said. The block is filled with "Harvard attorneys," "business owners" and other executives, the neighbor said. "No one knows about our block," he said. "It's a quiet place."

Hadiya's godmother agreed. “It amazed me when I found out what park it was," she said. "Nothing I have ever heard ever goes on over there.”

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Egypt curfew scaled back as Mursi seeks end to bloodshed


CAIRO/BERLIN (Reuters) - Authorities in an Egyptian city scaled back a curfew imposed by President Mohamed Mursi, and the Islamist leader cut short a visit to Europe on Wednesday to deal with the deadliest violence in the seven months since he took power.


Two more protesters were shot dead before dawn near Cairo's central Tahrir Square on Wednesday, a day after the army chief warned that the state was on the brink of collapse if Mursi's opponents and supporters did not end street battles.


More than 50 people have been killed in the past seven days of protests by Mursi's opponents, raising global concern over whether the Islamist leader can restore stability to the most populous Arab country.


Mursi imposed a curfew and a state of emergency on three Suez Canal cities on Sunday but that only seemed to further provoke crowds in a week of unrest marking the second anniversary of the uprising that toppled Hosni Mubarak.


The governor of Ismailia, one of the three canal cities, said on Wednesday he was scaling back the curfew, which would now take effect nightly from 2:00 a.m. instead of 9:00 p.m..


Mursi, speaking in Berlin before hurrying home to deal with the crisis, called for dialogue with opponents but would not commit to their demand that he first agree to include them in a unity government.


Asked about that proposal, he said the next government would be formed after parliamentary elections in April.


Egypt was on its way to becoming "a civilian state that is not a military state or a theocratic state", Mursi said.


The violence at home forced Mursi to scale back his European visit, billed as a chance to promote Egypt as a destination for foreign investment. He flew to Berlin but called off a trip to Paris and was due back home after only a few hours in Europe.


Chancellor Angela Merkel, who met him, echoed other Western leaders who have called on him to give his opponents a voice.


"One thing that is important for us is that the line for dialogue is always open to all political forces in Egypt, that the different political forces can make their contribution, that human rights are adhered to in Egypt and that of course religious freedom can be experienced," she said at a joint news conference with Mursi.


SPIRIT OF REVOLUTION


Mursi's critics accuse him of betraying the spirit of the revolution by keeping too much power in his own hands and those of his Muslim Brotherhood, the Islamist movement banned under Mubarak which won repeated elections since the 2011 uprising.


Mursi's supporters say the protesters want to overthrow Egypt's first democratically elected leader. The current unrest has deepened an economic crisis that saw the pound currency tumble in recent weeks.


Near Cairo's Tahrir Square on Wednesday morning, dozens of protesters threw stones at police who fired back teargas, although the scuffles were brief.


"Our demand is simply that Mursi goes, and leaves the country alone. He is just like Mubarak and his crowd who are now in prison," said Ahmed Mustafa, 28, a youth who had goggles on his head to protect his eyes from teargas.


Opposition politician Mohamed ElBaradei called for a meeting of the president, ministers, the ruling party and the opposition to halt the violence. But he also restated the precondition that Mursi first commit to seeking a national unity government.


The worst violence has been in the Suez Canal city of Port Said, where rage was fuelled by death sentences passed against soccer fans for roles in deadly riots last year.


After decades in which the West backed Mubarak's military rule of Egypt, the emergence of an elected Islamist leader in Cairo is probably the single most important change brought about by the wave of Arab revolts over the past two years.


Mursi won backing from the West last year for his role in helping to establish a ceasefire between Israel and Palestinians that ended a conflict in Gaza. But he then followed that with an effort to fast-track a constitution that reignited dissent at home and raised global concern over Egypt's future.


Western countries were alarmed this month by video that emerged showing Mursi making vitriolic remarks against Jews and Zionists in 2010 when he was a senior Brotherhood official.


German Foreign Minister Guido Westerwelle said ahead of Mursi's visit that the remarks, in which Mursi referred to Zionists as "descendants of apes and pigs" were "unacceptable".


"NOT AGAINST JEWS"


Asked about those remarks at the news conference with Merkel, Mursi repeated earlier explanations that they had been taken out of context.


"I am not against the Jewish faith," he said. "I was talking about the practices and behavior of believers of any religion who shed blood or who attack innocent people or civilians. That's behavior that I condemn."


"I am a Muslim. I'm a believer and my religion obliges me to believe in all prophets, to respect all religions and to respect the right of people to their own faith," he added.


Egypt's main liberal and secularist bloc, the National Salvation Front, has so far refused talks with Mursi unless he promises a unity government including opposition figures.


"Stopping the violence is the priority, and starting a serious dialogue requires committing to guarantees demanded by the National Salvation Front, at the forefront of which are a national salvation government and a committee to amend the constitution," ElBaradei said on Twitter.


Those calls have also been backed by the hardline Islamist Nour party - rivals of Mursi's Brotherhood. Nour and the Front were due to meet on Wednesday, signaling an unlikely alliance of Mursi's critics from opposite ends of the political spectrum.


Brotherhood leader Mohamed El-Beltagy dismissed the unity government proposal as a ploy for the Front to take power despite having lost elections. On his Facebook page he ridiculed "the leaders of the Salvation Front, who seem to know more about the people's interests than the people themselves".


In a sign of the toll the unrest is having on Egypt's economy, ratings agency Fitch downgraded its sovereign rating by one notch to B on Wednesday.


German industry leaders see potential in Egypt but are concerned about political instability.


"At the moment many firms are waiting on political developments and are cautious on any big investments," said Hans Heinrich Driftmann, head of Germany's Chamber of Industry and Commerce.


(Additional reporting by Yasmine Saleh and Marwa Awad in Cairo, Stephen Brown and Gernot Heller in Berlin and Arshad Mohammed in Washington; Writing by Peter Graff; Editing by Peter Millership)



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Defensive stocks extend rally as caution sets in

NEW YORK (Reuters) - Stocks rose on Tuesday, led by defensive sectors, in a sign the cash piles moving into the market recently are being put to use by cautious investors to pick up more gains.


The S&P 500 is on track to post its best monthly performance since October 2011 as investors poured $55 billion in new cash into stock mutual funds and exchange-traded funds in January, the biggest monthly inflow on record.


Among rising defensive shares, which are companies relatively immune to economic swings, were drugmaker Pfizer, up 1.2 percent to $27.16 and AT&T , 1.5 percent higher to $34.64.


The S&P hovered near 1,500, and market technicians say the benchmark is at a turning point which will determine if the index will keep moving higher or find it difficult to break through, resulting in a move lower in the near term.


"Cyclicals were moving very nicely, now you see balance with some of the defensives. Many managers use that as an internal hedge in equity portfolios," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.


She said the market is cautious ahead of Wednesday's statement following the Federal Reserve's two-day meeting. In addition, defensive stocks would hold up better if Friday's payrolls report surprises on the downside.


The Dow Jones industrial average <.dji> rose 57.42 points or 0.41 percent, to 13,939.35, the S&P 500 <.spx> gained 4.88 points or 0.33 percent, to 1,505.06 and the Nasdaq Composite <.ixic> dropped 3.24 points or 0.1 percent, to 3,151.06.


The top performing sectors on the S&P 500 were healthcare <.spxhc> and telecom services <.splrcl>, both up more than 1 percent.


The equity gains have largely come on a strong start to earnings season, though results were mixed on Tuesday with Pfizer rising but Ford Motor Co dropping after its report.


Both companies reported profits that topped expectations, but Ford also forecast a wider loss in its European segment. Shares dropped 3.6 percent to $13.32 as one of the biggest percentage losers on the S&P 500.


Thomson Reuters data showed that of the 174 companies in the S&P 500 that have reported earnings this season, 68.4 percent have been above analyst expectations, which is a higher proportion than over the past four quarters and above the average since 1994.


The Nasdaq was pressured by disappointing outlooks from Seagate Technology and BMC Software . Seagate shares lost 8.3 percent to $34.30 and BMC fell 8.5 percent to $40.70.


Software maker VMware Inc lost 20 percent to $78.26 also after a cautious 2013 outlook.


Amazon was the biggest drag on the Nasdaq with a 2 percent drop to $270.57 before its results, expected after the closing bell.


U.S. home prices rose in November to rack up their best yearly gain since the housing crisis began, a further sign that the sector is on the mend, but consumer confidence fell to its lowest level in more than a year in the wake of higher taxes for many Americans.


(Editing by Kenneth Barry and Nick Zieminski)



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Report links A-Rod with PED use; MLB investigates


NEW YORK (AP) — Major League Baseball said it is "extremely disappointed" about new allegations of performance-enhancing drug use against Alex Rodriguez and other players contained in a newspaper report.


The Miami New Times, a popular alternative weekly, said in a story Tuesday that it had obtained files through an employee at a recently closed clinic in south Florida that show Rodriguez purchased HGH and other substances.


"We are always extremely disappointed to learn of potential links between players and the use of performance-enhancing substances. ... Through our Department of Investigations, we have been actively involved in the issues in South Florida," MLB's statement said.


Rodriguez, the New York Yankees slugger currently recovering from hip surgery, has admitted using steroids from 2001-03 but insisted he stopped after that.


"We fully support the Commissioner's Joint Drug Prevention and Treatment Program. This matter is now in the hands of the Commissioner's Office," the Yankees said in a statement. "We will have no further comment until that investigation has concluded."


Other players named by the New Times as appearing in the records at Biogenesis include Melky Cabrera, Gio Gonzalez, Bartolo Colon and Nelson Cruz. Cabrera, the All-Star game MVP for the San Francisco Giants last season, was suspended 50 games in August for failing a drug test. The outfielder has signed with the Toronto Blue Jays as a free agent.


Colon, a pitcher for the Oakland A's, was also suspended 50 games in August.


Gonzalez, who went 21-8 for the Washington Nationals last season, and Cruz, who hit 24 home runs for the Texas Rangers, had not previously been linked to performance-enhancing drugs.


The Rangers said in a statement that after being contacted by the New Times late last week, they notified Major League Baseball. The club said it had no further comment.


Gonzalez posted on his Twitter feed: "I've never used performance enhancing drugs of any kind and I never will, I've never met or spoken with tony Bosch or used any substance."


The report said that the notes of clinic chief Anthony Bosch list the players' names and the substances they received, including human growth hormone and steroids. Several unidentified employees and clients confirmed to the publication that the clinic distributed the substances, the paper said. The employees said that Bosch bragged of supplying drugs to professional athletes but they never saw the sports stars in the office.


Any player found by MLB to use banned, performance-enhancing substances, is subject to suspension.


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