Yen near lows vs dollar, Asian shares ease in subdued trade

TOKYO (Reuters) - The yen hovered near its lows against the dollar and Tokyo stocks jumped closer to a 33-month high on Tuesday after markets took comments from a U.S. official as approval for Japan to pursue anti-deflation policies that weaken the yen.

U.S. Treasury Undersecretary Lael Brainard said on Monday the United States supports Japanese efforts to end deflation, but she noted that the G7 has long been committed to exchange rates determined by market forces, "except in rare circumstances where excess volatility or disorderly movements might warrant cooperation.

"Her (Brainard's) comments gave confidence to the market. It was surprising, and was taken as the Obama administration giving a green light to 'Abenomics'," said Takuya Takahashi, a market analyst at Daiwa Securities.

Japan has faced some overseas criticism that it is intentionally trying to weaken the yen with monetary easing, but talk of a so-called currency war was dialled back ahead of a Group of 20 meeting in Moscow on Friday and Saturday.

G20 officials said on Monday the Group of Seven nations are considering a statement this week reaffirming their commitment to "market-determined" exchange rates.

European Central Bank council member Jens Weidmann also said the euro was not overvalued at current levels.

The dollar slipped 0.3 percent to 94.185 yen after marking its highest level since May 2010 of 94.465 on Monday. The euro eased 0.3 percent to 126.12 yen after rising more than 2 percent on Monday. It hit its highest since April 2010 of 127.71 yen last week.

"I think the yen's weakening is a function of (playing)catch-up," and not Japan resorting to deliberate devaluation of its currency, said Andrew Wilkinson, chief economic strategist at Miller Tabak & Co. in New York. "It's the market's way of saying: 'We're convinced there is a movement afoot to reinflate Japan.'"

The yen is pressured by anticipation that Prime Minister Shinzo Abe will endorse a far more dovish Bank of Japan regime when the current leadership's term ends next month, although the BOJ is expected to refrain from taking fresh easing steps when it meets this week.

Share trading was subdued with many regional bourses shut for holidays. Encouraging trade data from China late last week was lending support to sentiment but non-Japan markets lacked momentum as investors awaited key events such as the U.S. president's State of the Union address for trading cues.

European markets are seen inching lower, with the Euro STOXX 50 index futures down 0.1 percent. A 0.2 percent drop in U.S. stock futures also suggested a soft Wall Street start. <.l><.eu><.n/>

The MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> fell 0.1 percent, with Australian shares closing flat ahead of corporate earnings due this week.

The weaker yen in turn hoisted the Nikkei stock average <.n225> to close 1.9 percent higher on improving earnings prospects for exporters. <.t/>

Trading resumed in Japan and South Korea but markets in Singapore, Hong Kong, mainland China, Malaysia and Taiwan remained closed.

STATE OF UNION ADDRESS

Currency and equities markets were also looking ahead to President Barack Obama's State of the Union address later on Tuesday night, for any signs of a deal to avert automatic spending cuts due to take effect March 1.

"We believe that the G20's take on currency wars, Mr. Obama's upcoming state of the union address, and data on the current condition of the U.S. economy should help markets assess where the global recovery stands and where we are heading," Barclays Capital said in a research report.

U.S. and Chinese data last week lifted the tech-focused Nasdaq Composite Index <.ixic> to a 12-year closing high and the Standard & Poor's 500 Index <.spx> to a five-year peak on Friday.

Financial markets showed a muted reaction to the news that North Korea has conducted a nuclear test.

"The test was not something that makes your heart pound as much as a pressing situation between Iran and Israel," said Kaname Gokon, research manager at brokerage Okato Shoji, referring to the threat of possible military action to prevent Iran from developing nuclear weapons.

U.S. crude futures edged down 0.1 percent to $96.90 a barrel while Brent steadied around $118.

Spot gold stayed near a one-month low.

(Additional reporting by Ayai Tomisawa, Lisa Twaronite and Osamu Tsukimori in Tokyo; Editing by Chris Gallagher)

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Back to the future as G20 comes to Russia

MOSCOW (Reuters) - Group of 20 policymakers have an ideal chance in Moscow this week to ponder whether monetary policy largesse will blunt their will to carry out the economic reforms needed to put global growth on a sustainable footing.

On their drive from the airport to the city center, down highways clogged with luxury cars, it may dawn on finance ministers and central bankers that Russia, this year's G20 host, got there first.

Some will check in to the five-star Ritz-Carlton hotel near the Manezh, the former 19th-century cavalry stable by the Kremlin walls where they meet this weekend. But convenience comes at a price: almost $17,000 per night for a luxury suite.

The world's largest oil producer has, through much of the Vladimir Putin era, been minting money as its central bank bought up hundreds of billions of export petrodollars, and the government spent its way out of the 2009 slump.

But the side-effects -- political complacency, declining competitiveness and a misallocation of capital towards conspicuous consumption and prestige projects -- increasingly outweigh the benefits to Russia's $2.1 trillion economy.

Some economists say Russia's story could foretell the outcome of ultra-loose monetary policy in the United States, Britain, Japan and symbolized by European Central Bank President Mario Draghi's vow last July to do "whatever it takes" to see the euro through its debt crisis.

"Russia has oil; Europe has Draghi," Tim Ash, the London-based head of emerging markets research at Standard Bank, said on a recent trip to Moscow. "Europe is catching up to all the problems that Russia has done nothing about for the past decade."

Others say that may be stretching the point but there are certainly signs that the zeal for major economic and regulatory reforms in Europe has faded somewhat since Draghi took the sting out of the debt crisis.

CURRENCY WARS

The G20 accounts for 90 percent of the world's economy and two-thirds of its population. Russia has taken the helm this year as the group has split between borrowers seeking to grow out of a debt trap and surplus countries keener on austerity.

Gone is the shared sense of purpose that embodied the G20 summit in London of 2009, which created a huge financial backstop to stem the crisis that resulted from the collapse of Wall Street investment bank Lehman Brothers.

"The G20 has really struggled in the past couple of years after its really great 2008 and 2009," Jim O'Neill, the outgoing chairman of Goldman Sachs Asset Management and leading emerging markets economist, told Reuters.

"It's already desperately searching for an identity."

Russia, holder of the world's fourth-largest gold and foreign exchange reserves, also finds itself on the barricades in an as yet merely rhetorical "currency war" after its central bank accused Japan's new government of protectionist monetary policy.

But, G20 sources and economists say, officials are likely to tone down their rhetoric over competitive currency devaluations.

"I don't see how anybody can complain. Washington is keeping quiet because that's what it has done for the past 30 years," said O'Neill.

SUPPLY VS DEMAND

For its G20 presidency, Moscow has drawn up an agenda focusing on jobs and investment, improved financial regulation and deficit reduction that is enthusiastically backed by the International Monetary Fund and World Bank.

But in a world suffering a dearth of demand, there is likely to be pushback, again led by the United States, against Russia's push for "binding and realistic" goals to cut borrowing.

A target set at the G20's Toronto summit in 2010 to halve budget deficits expires this year, and one G20 source told Reuters there could be heated debate as the euro zone's dominant economy, Germany, calls for new deficit targets to be set.

Here, at least, Russia can show some leadership by pointing to its own balanced budget, and its adoption last year of a so-called fiscal rule intended to reduce the dependence of its public finances on oil and gas revenues.

"Russia's agenda reflects their own policy preoccupations. To the extent that it is relevant to a broader global forum, that will be a fluke," said Christopher Granville, managing director of Trusted Sources, an emerging markets consultancy.

"But it's not an agenda that's way off in outer space."

Policymakers will hope to set aside friction between Russia and the West over trade and human rights during the build-up to this September's G20 summit in St Petersburg, given the forum's focus on economic issues.

Russia, a country of more than 140 million people, says it is up to the task of leading the G20, not least thanks to its experience as half of the 'G2' that once dominated global diplomacy during the Cold War.

"It's used to thinking kind of big," said Russia's top financial diplomat, summit 'sherpa' Ksenia Yudayeva.

But things may be more tricky next year, part two of a double-header, when Russia chairs the G8. Moscow is the odd one out in what Granville calls "a group of like-minded Western countries with Japan as an honorary member".

Putin, elected for a third term as president last March after four years as prime minister, has made international summits and sporting events an important part of his development agenda for Russia.

He will host the G8 summit in the summer of 2014 in Sochi, the venue of the next Winter Olympics, and hosts the World Cup soccer finals in 2018.

Russia expects to spend $50 billion on preparing for the Sochi Games, a sum that would make it the most expensive Olympics. That is progress at a high price.

(Additional reporting by Lidia Kelly and Lesley Wroughton, editing by Mike Peacock)

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How'd They Make Carrie Underwood's Glowing Gown?

Stylewatch
Style News Now

02/11/2013 at 12:25 AM ET

Kevork Djansezian/Getty; John Shearer/Invision/AP (2)

We can’t say we were surprised to see that Carrie Underwood had ditched her form-fitting Roberto Cavalli number for a princess-y silver gown to perform her song “Blown Away” at the Grammys Sunday night. When glowing paisley details began to unscroll across her full skirt, however? We definitely didn’t see that coming.

“We wanted it to be artful and dramatic,” Underwood told reporters backstage. “I just like to stand still and sing sometimes, so this seemed like the best way I could do that and still create something visually attention-capturing.” On the technology behind it, she was a little more tight-lipped, saying “I guess I probably shouldn’t tell my secret, should I?” — but luckily, we’ve already got the inside info.

To perform the song that won her best solo country performance, the superstar donned a custom Theia gown designed specifically for the vivid light show. The line’s creative director Don O’Neill sourced fabric for the 4 feet 5 inches-wide skirt that had to be approved by both Underwood’s stylist, Trish Townsend, as well as the video team creating the special effects.

With only three days to create the gown, O’Neill’s team worked around the clock, stitching together 10 yards of Duchesse satin, 100 yards of tulle and crinoline and thousands of Swarovski crystals onto the bodice. Meanwhile, the production team created the effects that were projected onto her gown, including sparkling stars, rose petals and butterflies.

And was all that work worth it? Judging by your overwhelmingly positive reactions on Twitter, absolutely. And O’Neill was thrilled with the result too, especially because he took the line’s name from the Greek goddess of light. “There couldn’t be a more perfect opportunity to fuse light in a literal sense with one of my gowns,” he says in a statement, “and have it showcased on a national stage by Carrie Underwood, the first celebrity to wear a Theia dress four years ago when we launched.”

Tell us: What did you think of Underwood’s high-tech couture?

–Alex Apatoff

PHOTOS: SEE MORE GRAMMY RISK-TAKERS!

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Square scandal highlights growing pains at tech start-ups

SAN FRANCISCO (Reuters) - When Square Chief Operating Officer Keith Rabois left his job last month, citing legal threats from a young colleague with whom he had a two-year relationship, he threw a spotlight on the risks associated with the freewheeling startup culture that many entrepreneurs cherish.

Startups often thrive on a lack of rules and boundaries. But experts say that as they make the transition from a handful of people in a room to sizeable businesses, the hazards of operating without manual - including lawsuits, reputational hits, and waning employee morale - grow exponentially.

Longtime employees sometimes chafe at the arrival of human resources professionals, codes of conduct and other policies that they fear will step on the company's culture. Yet entrepreneurs and start-up investors say they ultimately have little choice.

Take Facebook Inc, which displayed murals of naked women, some riding dogs, in the Palo Alto offices it leased as a small company in 2005. As proud as some of the early employees were of them — one was painted by the then-girlfriend of Facebook impresario and serial entrepreneur Sean Parker — they got painted over shortly after venture-capital firm Accel Partners invested in the company. Facebook had no immediate comment.

About a year into the life of online-ad tracking startup DoubleVerify, an employee gave a presentation about how advertising fraud takes place. Many in the room got a rude awakening when a slide popped up showing an example of an ad where it shouldn't be: next to a particularly raunchy image on a pornography site.

"That was the first time we realized, ‘We gotta get a little more institutionalized," recalls founder Oren Netzer. Today, the company has policies concerning naked images. The same presentation would use a less controversial example, or obscure anything racy.

Alcohol is another dicey topic. "We used to have these new employee hazing ceremonies," said Dheeraj Pandey, chief executive of virtualization company Nutanix, largely involving knocking back tequila shots with chili peppers. But once the company hit about 100 employees, some new hires pushed back and he started considering the potential for liability.

"It just faded away about four, five months ago," he said about the hazing. Potential concerns run the gamut from some employees feeling excluded if they don't drink to incidents that sometimes accompany drunken behavior.

At 250-person social-media management company Hootsuite, "I somewhat infamously have said I never wanted to work at a company with an HR department," says founder Ryan Holmes.

"That's coming back to bite me a little bit now."

MISSION STATEMENTS, HR FLUFF

A year ago, Holmes made his executive assistant the director of human resources. That type of promote-from-within strategy for HR is commonplace, startups say.

A few months into her role, the new HR director told Holmes the company needed a mission statement. "I said, ‘Oh my God, this is HR fluff,'" Holmes remembers. But shortly afterward, when he overheard new hires discussing beliefs he thought were out of step with Hootsuite's ethos — he says he cannot recall the details — he realized she was right.

But Holmes says he is resisting conforming on other levels. Hootsuite employees attend teambuilding trips, including a recent stay at a hot-springs resort. That is the type of event big companies cut out — Google Inc halted its famous all-employee trips in 2009 - often because of the potential for various kinds of legal liability and cost.

Holmes says he might have to rethink his overnight trips if the company ever goes public, but for now, he plans to keep going. "We think it's very valuable," he says.

At Nutanix, Pandey decided last summer's annual whitewater rafting trip on the Sacramento River would be the last. "We used to go through some rough rapids, and had a couple of close shaves," he said. "A couple of the guys aren't good swimmers."

Part of the philosophy is that young companies want to encourage a "think different" attitude, employees say.

"Start-ups by design want to differentiate themselves from the large companies like the HPs that have very thick employee handbooks," said Brian Samson, chief executive of HR for Startups, referring to computer company Hewlett Packard Co.

Start-ups often deal with the inevitable by aiming for a careful, light-footed approach to new policies.

"I've tried to make sure we don't talk about rules," says Evan Wittenberg, HR head at cloud-content firm Box. "The language around this really matters. These are guidelines."

Still, there are tensions as the company, which now employs around 700 and is considered a likely prospect for a 2013 initial public offering, grows. Cecilia Wong, people manager at Box, cites the daylong orientation process for new employees.

"I've had some managers ask, ‘Why's it a full day? On my first day, it was just an hour, then I could hit the ground running,'" she says. She believes the full day is important for explaining the company culture, business and logistics issues.

The consequences of neglecting HR policy and other big-company practices can be dire.

Rabois said he resigned from his post after an ex-boyfriend that he recommended for a job at Square threatened to sue for sexual harassment. A Square spokesman declined to say what kind of HR policies, if any, the company has in place, and he declined to comment on any issue related to the relationship that led to Rabois' resignation. Square had about 30 employees when Rabois joined and now has about 400.

Many large organizations - not just companies, but nonprofits and government agencies - have firm policies about intra-office romances, and often prohibit them if one party has any kind of supervisory authority over the other.

"You can be open to liability if the relationship goes sour, and you have a person in a position of power over the other person," said San Francisco employment attorney Therese Lawless. "Any actions of that person in power can be deemed to be retaliatory."

In addition, it can create a morale issue if other employees believe the more junior employee in an ongoing relationship is receiving favorable treatment, she said.

(Reporting By Sarah McBride; Editing by Jonathan Weber and Leslie Gevirtz)

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Israel's Lieberman says Palestinian peace accord impossible

JERUSALEM (Reuters) - Israel has no chance of signing a permanent peace accord with the Palestinians and should instead seek a long-term interim deal, the most powerful political partner of Prime Minister Benjamin Netanyahu said on Saturday.

The remarks by Avigdor Lieberman, an ultranationalist whose joint party list with Netanyahu narrowly won a January 22 election while centrist challengers made surprise gains, seemed designed to dampen expectations at home and abroad of fresh peacemaking.

A spring visit to Israel and the Palestinian territories by U.S. President Barack Obama, announced this week, has stirred speculation that foreign pressure for a diplomatic breakthrough could build - though Washington played down that possibility.

In a television interview, ex-foreign minister Lieberman linked the more than two-year-old impasse to pan-Arab political upheaval that has boosted Islamists hostile to the Jewish state.

These include Hamas, rivals of U.S.-backed Palestinian President Mahmoud Abbas, who control the Gaza Strip and spurn coexistence with Israel though they have mooted extended truces.

"Anyone who thinks that in the center of this socio-diplomatic ocean, this tsunami which is jarring the Arab world, it is possible to arrive at the magic solution of a comprehensive peace with the Palestinians does not understand," Lieberman told Israel's Channel Two.

"This is impossible. It is not possible to solve the conflict here. The conflict can be managed and it is important to manage the conflict ... to negotiate on a long-term interim agreement."

Abbas broke off talks in late 2010 in protest at Israel's settlement of the occupied West Bank. He angered Israel and the United States in November by securing a U.N. status upgrade that implicitly recognized Palestinian independence in all the West Bank, East Jerusalem and Gaza.

Israel insists it will keep East Jerusalem and swathes of West Bank settlements under any eventual peace deal. Most world powers consider the settlements illegal because they take up land seized in the 1967 Middle East war.

Lieberman, himself a West Bank settler, said the ball was "in Abu Mazen's (Abbas') court" to revive diplomacy.

Abbas has demanded Israel first freeze all settlement construction. With two decades gone since Palestinians signed their first interim deal with Israel, he has ruled out any new negotiations that do not solemnize Palestinian statehood.

Netanyahu's spokesman Mark Regev noted that Lieberman, in the Channel Two interview, had said he was expressing his own opinion.

Asked how Netanyahu saw peace prospects for an accord with the Palestinians, Regev referred to a speech on Tuesday in which the conservative prime minister said that Israel, while addressing threats by its enemies, "must also pursue secure, stable and realistic peace with our neighbors".

Netanyahu has previously spoken in favor of a Palestinian state, though he has been cagey on its borders and whether he would be prepared to dismantle Israeli settlements.

Lieberman's role in the next coalition government is unclear as he faces trial for corruption. If convicted, he could be barred from the cabinet. Lieberman denies wrongdoing and has said he would like to regain the foreign portfolio, which he surrendered after his indictment was announced last year.

(Writing by Dan Williams; Editing by Stephen Powell)

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Tiger Woods & Lindsey Vonn Are 'Spending More Time' Together: Source

Buzz

By Steve Helling

02/09/2013 at 06:00 PM EST

Tiger Woods and Lindsey Vonn

Mick Tsikas/Reuters/Landov; Luis Guerra/Ramey

It was quite the gesture.

After Lindsey Vonn suffered a devastating injury during the Alpine World Championships in Austria, she got a bit of help from Tiger Woods. Walking on crutches, Vonn – who tore two ligaments in her right knee and fractured her shin when she crashed on Tuesday ­– boarded Woods's private jet to return home.

Is it a sign that the rumored relationship between Woods and Vonn is heating up?

"Tiger and Lindsey have been friends for a while, and nothing started out romantically at all," a source tells PEOPLE. "But they really have a lot in common and got closer and closer. He still refers to her as 'my very good friend,' but he's been spending more and more time talking to her – and talking about her."

Last month, Vonn's reps kept mum about the rumored relationship, telling PEOPLE that her "focus is solely on competing and on defending her titles and thus she will not participate in any speculation surrounding her personal life at this time."

But the source close to Woods tells PEOPLE that Woods, 37, and Vonn. 28, talk and text frequently.

"Tiger really does want a woman who he can have good conversations with," he says. "He wants shared interests and outlooks. He is finding that with [Lindsey]."

Woods made international headlines in 2009 when he was linked to dozens of women while still married to his ex-wife, Elin Nordegren.

Since then, he has dated sporadically, but struggled to find someone who wanted a relationship for the right reasons.

"She's not freaked out by his past, and that's really appealing to him," says the source. "He really does deserve to be happy. He has been flogging himself for three years, and it's good to see him moving forward."

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Japan may release data proving Chinese radar incident: media

TOKYO (Reuters) - Japan may release data it says will prove a Chinese naval vessel directed its fire control radar at a Japanese destroyer near disputed islands in the East China Sea, local media reported.

Japan has said a Chinese frigate on January 30 locked its targeting radar on a Japanese destroyer - a step that usually precedes the firing of weapons - but China insists that its vessel used only ordinary surveillance radar.

The incident has added to tensions between the two nations over the disputed islands.

Japan will consider how much normally classified data it can release, the media reports said, citing comments by Japan Defence Minister Itsunori Onodera on local television.

"The government is considering the extent of what can be disclosed," Kyodo news agency quoted Onodera as saying.

China has accused Japan of smearing its name with the accusations, and on Saturday, the official Xinhua news agency continued the war of words.

"By spreading false accusations and posing as a poor victim, Japan had intended to tarnish China's image so as to gain sympathy and support, but a lie does not help," it said in an English language commentary.

"China has been exercising maximum restraint and stayed committed to solving the dispute through dialogue and consultation."

Japan and China have been involved in a series of incidents in recent months in the East China Sea where Chinese and Japanese naval vessels regularly shadow each others movements.

Both countries claim a small clusters of islands, known as Diaoyu in China and Senkaku in Japan, believed to be rich in oil and gas. Controlled by Japan, possession of the uninhabited outcrops and the sea surrounding them would provide China with easier access to the Pacific.

Hopes had been rising for an easing in tensions, including a possible summit between Japanese Prime Minister Shinzo Abe and Chinese Communist Party chief Xi Jinping. But the radar issue has seen China and Japan engage in a fresh round of invective.

China's Defence Ministry on Thursday said Japan's complaints did not "match the facts". The Chinese ship's radar, it said, had maintained regular alerting and surveillance operations and the ship "did not use fire control radar".

Japan's position against China has hardened since Abe led his conservative party to a landslide election victory in December, promising to beef up the military and stand tough in territorial disputes.

The commander of U.S. forces in the Asia-Pacific said the squabble between Japan and China underlined the need for rules to prevent such incidents turning into serious conflict.

China also has ongoing territorial disputes with other Asian nations including Vietnam and the Philippines over islands in the South China Sea.

(Reporting by Tim Kelly; Additional reporting by Ben Blanchard in BEIJING; Editing by Michael Perry)

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Minka Kelly: 'I'm Not Worthy' of Acting with Oprah

By Jennifer Cress

02/08/2013 at 07:40 PM EST

Minka Kelly as Jacqueline Kennedy Onassis

Pacific Coast News

It's intimidating enough to play Jackie O, but Minka Kelly felt even more pressure to perform when she found out who was joining the cast of her latest film, The Butler.

"I'm not worthy. I feel so lucky and grateful. I was like, 'What am I doing here?!' " Kelly tells PEOPLE of starring alongside Robin Williams, Forest Whitaker, John Cusack, Vanessa Redgrave, Jane Fonda and more in the upcoming film, which tells the story of a butler who served eight presidents.

The movie also features another major star: the one and only Oprah Winfrey. "I didn't get to meet Oprah because our shooting schedules were different, but she's a pretty loved lady," Kelly says. "I have yet to hear a bad thing about her!"

Kelly found that the most difficult part of playing Jackie Kennedy was nailing the former first lady's distinct accent. "I think she spoke in a way she thought she should speak, so getting that down was hard. There's a musicality and rhythm to the way she speaks," Kelly explains. "I went to sleep listening to her."

Another tough task? Slipping into the retro costumes. "My body is so different from her because I have curves, so fitting into those vintage clothes was actually really hard," she shares. "Also it was hot – and there was a lot of wool!"

Jennifer Graylock / Getty

But Kelly had no issue slipping into the stunning Oscar de la Renta gown (left) she strutted down the runway in at the Red Dress Collection fashion show in N.Y.C. on Wednesday night. The actress walked for the second year in a row in honor of The Heart Truth campaign, which encourages women to monitor their heart health.

For the month of February, Diet Coke will donate $1 for every person who uploads a heart-inspired photo to Twitter or Instagram using the hashtag #showyourheart. Visit to dietcoke.com/showyourheart for more information.

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After early start, worst of flu season may be over

NEW YORK (AP) — The worst of the flu season appears to be over.

The number of states reporting intense or widespread illnesses dropped again last week, and in a few states there was very little flu going around, U.S. health officials said Friday.

The season started earlier than normal, first in the Southeast and then spreading. But now, by some measures, flu activity has been ebbing for at least four weeks in much of the country. Flu and pneumonia deaths also dropped the last two weeks, the Centers for Disease Control and Prevention reported.

"It's likely that the worst of the current flu season is over," CDC spokesman Tom Skinner said.

But flu is hard to predict, he and others stressed, and there have been spikes late in the season in the past.

For now, states like Georgia and New York — where doctor's offices were jammed a few weeks ago — are reporting low flu activity. The hot spots are now the West Coast and the Southwest.

Among the places that have seen a drop: Lehigh Valley Hospital-Cedar Crest in Allentown, Pa., which put up a tent outside its emergency room last month to help deal with the steady stream of patients. There were about 100 patients each day back then. Now it's down to 25 and the hospital may pack up its tent next week, said Terry Burger, director of infection control and prevention for the hospital.

"There's no question that we're seeing a decline," she said.

In early December, CDC officials announced flu season had arrived, a month earlier than usual. They were worried, saying it had been nine years since a winter flu season started like this one. That was 2003-04 — one of the deadliest seasons in the past 35 years, with more than 48,000 deaths.

Like this year, the major flu strain was one that tends to make people sicker, especially the elderly, who are most vulnerable to flu and its complications

But back then, that year's flu vaccine wasn't made to protect against that bug, and fewer people got flu shots. The vaccine is reformulated almost every year, and the CDC has said this year's vaccine is a good match to the types that are circulating. A preliminary CDC study showed it is about 60 percent effective, which is close to the average.

So far, the season has been labeled moderately severe.

Like others, Lehigh Valley's Burger was cautious about making predictions. "I'm not certain we're completely out of the woods," with more wintry weather ahead and people likely to be packed indoors where flu can spread around, she said.

The government does not keep a running tally of flu-related deaths in adults, but has received reports of 59 deaths in children. The most — nine — were in Texas, where flu activity was still high last week. Roughly 100 children die in an average flu season, the CDC says

On average, about 24,000 Americans die each flu season, according to the CDC.

According to the CDC report, the number of states with intense activity is down to 19, from 24 the previous week, and flu is widespread in 38 states, down from 42.

Flu is now minimal in Florida, Kentucky, Maine, Montana, New Hampshire and South Carolina.

___

Online:

CDC: http://www.cdc.gov/flu/

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Stocks end higher for sixth straight week, tech leads

NEW YORK (Reuters) - The Nasdaq composite stock index closed at a 12-year high and the S&P 500 index at a five-year high, boosted by gains in technology shares and stronger overseas trade figures.

The S&P 500 also posted a sixth straight week of gains for the first time since August.

The technology sector led the day's gains, with the S&P 500 technology index <.splrct> up 1.0 percent. Gains in professional network platform LinkedIn Corp and AOL Inc after they reported quarterly results helped the sector.

Shares of LinkedIn jumped 21.3 percent to $150.48 after the social networking site announced strong quarterly profits and gave a bullish forecast for the year.

AOL Inc shares rose 7.4 percent to $33.72 after the online company reported higher quarterly profit, boosted by a 13 percent rise in advertising sales.

Data showed Chinese exports grew more than expected, a positive sign for the global economy. The U.S. trade deficit narrowed in December, suggesting the U.S. economy likely grew in the fourth quarter instead of contracting slightly as originally reported by the U.S. government.

"That may have sent a ray of optimism," said Fred Dickson, chief market strategist at D.A. Davidson & Co in Lake Oswego, Oregon.

Trading volume on Friday was below average for the week as a blizzard swept into the northeastern United States.

The U.S. stock market has posted strong gains since the start of the year, with the S&P 500 up 6.4 percent since December 31. The advance has slowed in recent days, with fourth-quarter earnings winding down and few incentives to continue the rally on the horizon.

"I think we're in the middle of a trading range and I'd put plus or minus 5.0 percent around it. Fundamental factors are best described as neutral," Dickson said.

The Dow Jones industrial average <.dji> ended up 48.92 points, or 0.35 percent, at 13,992.97. The Standard & Poor's 500 Index <.spx> was up 8.54 points, or 0.57 percent, at 1,517.93. The Nasdaq Composite Index <.ixic> was up 28.74 points, or 0.91 percent, at 3,193.87, its highest closing level since November 2000.

For the week, the Dow was down 0.1 percent, the S&P 500 was up 0.3 percent and the Nasdaq up 0.5 percent.

Shares of Dell closed at $13.63, up 0.7 percent, after briefly trading above a buyout offering price of $13.65 during the session.

Dell's largest independent shareholder, Southeastern Asset Management, said it plans to oppose the buyout of the personal computer maker, setting up a battle for founder Michael Dell.

Signs of economic strength overseas buoyed sentiment on Wall Street. Chinese exports grew more than expected in January, while imports climbed 28.8 percent, highlighting robust domestic demand. German data showed a 2012 surplus that was the nation's second highest in more than 60 years, an indication of the underlying strength of Europe's biggest economy.

Separately, U.S. economic data showed the trade deficit shrank in December to $38.5 billion, its narrowest in nearly three years, indicating the economy did much better in the fourth quarter than initially estimated.

Earnings have mostly come in stronger than expected since the start of the reporting period. Fourth-quarter earnings for S&P 500 companies now are estimated up 5.2 percent versus a year ago, according to Thomson Reuters data. That contrasts with a 1.9 percent growth forecast at the start of the earnings season.

Molina Healthcare Inc surged 10.4 percent to $31.88 as the biggest boost to the index after posting fourth-quarter earnings.

The CBOE Volatility index <.vix>, Wall Street's so-called fear gauge, was down 3.6 percent at 13.02. The gauge, a key measure of market expectations of short-term volatility, generally moves inversely to the S&P 500.

"I'm watching the 14 level closely" on the CBOE Volatility index, said Bryan Sapp, senior trading analyst at Schaeffer's Investment Research. "The break below it at the beginning of the year signaled the sharp rally in January, and a rally back above it could be a sign to exercise some caution."

Volume was roughly 5.6 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.

Advancers outpaced decliners on the NYSE by nearly 2 to 1 and on the Nasdaq by almost 5 to 3.

(Additional reporting by Angela Moon; Editing by Bernadette Baum, Nick Zieminski, Kenneth Barry and Andrew Hay)

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