Fiscal cliff uncertainty limits market gains

Updated 05 December 2012
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Fiscal cliff uncertainty limits market gains

NEW YORK: US stocks edged lower yesterday as investors fretted about Washington's ability to avoid a year-end budget crisis, but a Greek plan to buy back debt pushed the euro to a six-week high.
Commodities also struggled as weak manufacturing data and tense US budget talks stoked worries about the world economy.
Markets fear the United States could slip into recession if $600 billion of tax hikes and spending cuts are allowed to start taking effect in January. The White House and Congress have yet to agree on a long-term deficit reduction plan.
"This back-and-forth contentious debate is not helping investor attitudes and not boosting confidence in Washington," said Jack Ablin, chief investment officer at Harris Private Bank, who added the uncertainty prevents firms from hiring.
Data this week showed US manufacturing contracted in November, its worst month in more than three years.
"It's really starting to hurt the economy, and that increases trepidation among investors," Ablin said.
The Dow Jones Industrial Average was up 2.91 points, or 0.02 percent, at 12,968.51. The Standard & Poor's 500 Index was down 2.84 points, or 0.20 percent, at 1,406.62. The Nasdaq Composite Index was down 16.19 points, or 0.54 percent, at 2,986.00.
Worries about US lawmakers' inability to compromise on fiscal issues sapped earlier gains in European shares, with the FTSEurofirst 300 index retreating from a 17-month peak.
The euro, however, remained near a six-week high above $ 1.31, boosted by a Greek debt buyback plan and encouraging news from Portugal and Spain. Greece's buyback is a crucial part of a deal reached last week by international lenders to cut the country's debt pile, and needs to be completed before the IMF can release its emergency aid.
With the euro zone mood lifting, Spanish, Italian and Greek bonds rose while German Bunds stayed on the back foot.


though losses were limited by the potential impasse in budget talks.
Italian 10-year yields fell 5 basis points to 4.40 percent, while the Spanish equivalent was 3 ticks down at 5.24 percent, extending Monday's falls after Greece unveiled better-than-expected terms for the debt buyback.
Lingering worries about the world economy, though, pushed oil and gold lower, while copper was little changed. US crude oil dipped 78 cents to $ 88.31 a barrel, and gold fell about 1 percent to its lowest in nearly a month after prices broke below key support levels.
Weaker manufacturing data raised concern about fragile global growth, which could hurt demand for energy.


Pakistan puts US diplomat on black list for killing biker in road accident

Updated 7 min 3 sec ago
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Pakistan puts US diplomat on black list for killing biker in road accident

  • Col Joseph Emanuel Hall, defense attaché at the US embassy in Islamabad, killed a Pakistani national, Atiq Baig, when he jumped a red light in his SUV and crashed into the motorbike.
  • Placing the US diplomat’s name on exit control list will entail a lengthy procedure, Deputy Attorney General tells the court.
ISLAMABAD: Pakistan has put an American diplomat Col Joseph Emanuel Hall, who recently killed a motorcyclist and his pillion passenger in a road accident, on a black list to prevent him from leaving the country, revealed Deputy Attorney General Raja Khalid on Tuesday as he appeared in Islamabad High Court, which is looking into the tragic incident.
Khalid told the court that placing the US diplomat’s name on the exit control list would entail a lengthy procedure, adding that it was not even possible to put him on trial in Pakistan since he enjoyed diplomatic immunity under the Vienna Convention.
Hall, who is stationed in Islamabad where he works with the US Embassy as defense attaché, killed a Pakistani national, Atiq Baig, and injured his cousin, Raheel Ahmed, when he jumped a red light in his SUV and crashed into the other vehicle.
The incident took place on April 7, creating a sense of resentment among Pakistanis who have also witnessed unsavory incidents involving American diplomats in the past.
While the police rushed to the accident site, they could not accomplish much since Hall refused to step out of his vehicle or take an alcohol test.
The court was particularly riled by the way the law enforcement agency handled the issue, expressing displeasure with its officials and even observing that they “trembled” to see a foreigner.
The road accident happened at a time when US-Pakistan relations had already touched a new low.
The two countries have been trying to resolve a host of security and diplomatic issues. Their relations remain frosty, though a senior State Department official, Alice Wells, was in the federal capital just days ago to continue official engagements between the two countries.