Wall Street drifts after two-day run, Dow record in sight

NEW YORK (Reuters) - U.S. stocks edged higher on Thursday with investors hard-pressed to lift indexes to multi-year highs despite strong economic data.


The U.S. economy ticked up in the fourth quarter, reversing an earlier estimate showing contraction, and a drop in new claims for unemployment benefits last week added to a string of data that suggests the economy improved early this year.


Still, the positive revision to GDP data was expected and the claims continue a trend that is baked into prices. The market lacks catalysts as it digests its recent move higher, according to Kevin Caron, market strategist at Stifel, Nicolaus & Co in Florham Park, New Jersey, where he helps oversee $120 billion in assets under management.


"That's why I think you're seeing a fairly listless trading environment today," Caron said.


The Dow was within striking distance of a record high after a more than 7 percent year-to-date run. The Dow transports index <.djt>, seen as a bet on future growth, is up almost 13 percent this year and hit a record intraday high Thursday before turning slightly negative.


The Dow Jones industrial average <.dji> rose 14.79 points or 0.11 percent, to 14,090.16, the S&P 500 <.spx> gained 3.12 points or 0.21 percent, to 1,519.11 and the Nasdaq Composite <.ixic> added 9.13 points or 0.29 percent, to 3,171.39.


The Dow's intraday record, set October 11, 2007, stands at 14,198.10.


The S&P 500 has gained more than 2 percent in the past three sessions.


Equity markets suffered steep losses earlier in the week on concerns over the impact of an Italian election on the European economy, but bounced back on strong data and recent comments by Federal Reserve Chairman Ben Bernanke that showed continued support for the Fed's economic stimulus policy.


J.C. Penney Co Inc slumped 17.9 percent to $17.38 after the department store reported a steep drop in sales on Wednesday. Groupon Inc also slumped on weak revenue, with the stock off 20 percent at $4.76.


Cablevision shares tumbled nearly 10 percent after the cable provider took a $100 million hit on costs related to Superstorm Sandy and posted deeper video customer losses than expected.


Mylan Inc shares were on track to close at their highest ever after the generic drugmaker posted a 25 percent rise in fourth-quarter profit and said it will buy a unit of India's Strides Arcolab Ltd. Shares were last up 3.8 percent at $29.66.


Investors were keeping an eye on the debate in Washington over U.S. government budget cuts that will take effect starting Friday if lawmakers fail to reach agreement on spending and taxes. President Barack Obama and Republican congressional leaders arranged last-ditch talks to prevent the cuts, but expectations were low that any deal would emerge.


With 93 percent of the S&P 500 companies having reported results so far, 69.5 percent have beaten profit expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6.2 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Reporting by Rodrigo Campos, additional reporting by Ryan Vlastelica; Editing by Nick Zieminski)



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Josh Brolin and Diane Lane's Split Was 'Mutual,' Says James Brolin















02/27/2013 at 12:30 PM EST



James Brolin said his son Josh is doing fine in the wake of his impending divorce from Diane Lane, calling their split "mutual."

Brolin – who accompanied wife Barbra Streisand as she performed at the Oscars Sunday night – said his son, 45, was watching the Academy Awards show at a party with famed film directors the Coen brothers and his daughter.

"He's great," Brolin said. "You know, everything is mutual. It's all okay."

Josh Brolin and Lane, 48, were introduced by Streisand at a 2002 party and were married in 2004 at the actor's California ranch. They were separated for some time before Lane signed divorce papers on Valentine's Day, a source tells PEOPLE.

"This was a hard decision for both of them to make," added the source. "The relationship just ran its course."

James Brolin said his son, who had been married before to Alice Adair and who has two children, was coping well. "Evidently he's doing well," said James of Josh. "Everything is fine."

Reporting by AILI NAHAS

For much more on this story, pick up the latest issue of PEOPLE, on newsstands now

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Vt. lye victim gets new face at Boston hospital


BOSTON (AP) — A Vermont nurse disfigured in a 2007 lye attack has received a new face at a Boston hospital.


Carmen Blandin Tarleton's full facial transplant at Brigham & Women's Hospital included transplanting a female donor's facial skin to Tarleton's neck, nose and lips, along with facial muscles, arteries and nerves.


Hospital officials say the 44-year-old Thetford, Vt., woman suffered burns on more than 80 percent of her body after her estranged husband attacked her.


Tarleton's sister said Wednesday she showed "great appreciation" for the gift she's been given.


The donor's family believes their loved one's spirit lives on in Tarleton.


Tarleton has undergone more than 50 surgeries. The latest took 15 hours and included a team of more than 30 medical professionals.


Tarleton once worked as a transplant nurse.


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Italy parties seek way out of election stalemate


ROME (Reuters) - Italy's stunned political parties looked for a way forward on Tuesday after an election that gave none of them a parliamentary majority, posing the threat of prolonged instability and European financial crisis.


The results, notably by the dramatic surge of the anti-establishment 5-Star Movement of comic Beppe Grillo, left the center-left bloc with a majority in the lower house but without the numbers to control the powerful upper chamber, the Senate.


Financial markets fell sharply at the prospect of a stalemate that reawakened memories of the crisis that pushed Italy's borrowing costs toward unsustainably high levels and brought the euro zone to the brink of collapse in 2011.


"The winner is: Ingovernability," ran the headline in Rome newspaper Il Messaggero, reflecting the deadlock the country will have to confront in the next few weeks as sworn enemies are forced to work together to form a government.


Pier Luigi Bersani, head of the center-left Democratic Party (PD), has the difficult task of trying to agree a "grand coalition" with former prime minister Silvio Berlusconi, the man he blames for ruining Italy, or striking a deal with Grillo, a completely unknown quantity in conventional politics.


The alternative is new elections either immediately or within a few months, although both Berlusconi and Bersani have indicated that they want to avoid a return to the polls if possible: "Italy cannot be ungoverned and we have to reflect," Berlusconi said in an interview on his own television station.


For his part, Grillo, whose "non-party" movement won the most votes of any single party, has indicated that he believes the next government will last no more than six months.


"They won't be able to govern," he told reporters on Tuesday. "Whether I'm there or not, they won't be able govern."


He said he would work with anyone who supported his policy proposals, which range from anti-corruption measures to green-tinted energy measures but rejected suggestions of entering a formal coalition: "It's not time to talk of alliances... the system has already fallen," he said.


The election, a massive rejection of the austerity policies applied by Prime Minister Mario Monti with the backing of international leaders from U.S. President Barack Obama to German Chancellor Angela Merkel, caused consternation across Europe.


"This is a jump to nowhere that does not bode well either for Italy or Europe," said Spanish Foreign Minister Jose Manuel Garcia-Margallo.


In a sign of worry at the top over what effect the elections could have on the economy, Monti, whose austerity policies were repudiated by voters who shunned his centrist bloc, met the governor of the central bank, the economy minister and the European affairs minister to discuss the situation on Tuesday.


The former EU commissioner and his team of technocrats, who were brought in to govern when Berlusconi was consumed by crisis and scandal, will stay on until a new administration is formed.


UNTHINKABLE WITHOUT GRILLO


Projections for the Senate by the Italian Centre for Electoral Studies indicated that the center-left would have 121 seats, against 117 for the center-right alliance of Berlusconi's PDL and the regionalist Northern League. Grillo would take 54.


That leaves no party with the majority in a chamber which a government must control to pass legislation and opened up the prospect of previously inconceivable partnerships that will test the sometimes fragile internal unity of the main parties.


"The idea of a majority without Grillo is unthinkable. I don't know if anyone in the PD is considering it but I'm against it," said Matteo Orfini, a member of Bersani's PD secretariat.


"The idea of a PD-PDL government, even if it's backed by Monti, doesn't make any sense," he said.


Berlusconi, a media magnate whose campaigning all but wiped out Bersani's once commanding opinion poll lead, hinted in a telephone call to a morning television show that he would be open to a deal with the center-left - but not with Monti, the economics professor who replaced him 15 months ago.


"Italy must be governed," Berlusconi said, adding that he "must reflect" on a possible deal with the center-left. "Everyone must be prepared to make sacrifices," he said of the groups which now have a share of the legislature.


The Milan bourse was down almost 4 percent and the premium Italy pays over Germany to borrow on 10-year widened to a yield spread of 338 basis points, the highest since December 10 and more than 80 points above the level seen earlier on Monday.


At an auction of six-month Treasury bills, Italy's borrowing costs jumped by more than two thirds with the yield reaching 1.237 percent, the highest since October and compared to just 0.730 percent in a similar sale a month ago.


The euro dropped to an almost seven-week low against the dollar in Asia on fears of a revival of the euro zone crisis. It fell as far as $1.3042, its lowest since January 10.


"What is crucial now is that a stable functioning government can be built as swiftly as possible," said German Foreign Minister Guido Westerwelle. "This is not only in the interests of Italy but in the interests of all Europe."


However the view from some voters, weary of the mainstream parties, was unrepentant: "It's good," said Roger Manica, 28, a security guard in Rome, who voted for the center-left PD.


"Next time I'll vote 5-Star. I like that they are changing things, even if it means uncertainty. Uncertainty doesn't matter to me, for me what's important is a good person who gets things done," he said. "Look how well they've done."


A long recession and growing disillusionment with mainstream parties and tax-raising austerity fed the bitter public mood and contributed to the massive rejection of Monti, whose centrist coalition was relegated to the sidelines.


Berlusconi's campaign, mixing sweeping tax cut pledges with relentless attacks on Monti and Merkel, echoed many of the themes pushed by Grillo and underlined the increasingly angry mood of the Italian electorate.


But even if the next government turns away from the tax hikes and spending cuts brought in by Monti, it will struggle to revive an economy that has scarcely grown in two decades.


Monti was widely credited with tightening Italy's public finances and restoring its international credibility after the scandal-plagued Berlusconi, who is currently on trial for having sex with an under-age prostitute.


However he struggled to pass the kind of structural reforms needed to improve competitiveness and lay the foundations for a return to economic growth. A weak center-left government may not find it any easier.


For Italian business, with an illustrious history of export success, the election result brought dismay that there would be no quick change to what they see as a regulatory sclerosis that has kept the economy virtually stagnant for a decade.


"This is probably the worst possible scenario," said Francesco Divella, whose family began selling pasta under its eponymous brand in 1890 in the southern region of Puglia.


"We are very concerned about the uncertainty and apparent ungovernability," said Silvio Pietro Angori, chief executive of Pininfarina, which has designed Ferrari sportscars since 1950. "A company competing on the global markets like Pininfarina needs the support of a stable government that inspires trust."


One of the country's leading bankers summed up his personal reaction: "I'm in shock," he told Reuters. "What a mess!"


(Additional reporting by Barry Moody, Gavin Jones, Lisa Jucca, Steven Jewkes, Steve Scherer Writing by Philip Pullella and James Mackenzie; Editing by Alastair Macdonald)



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Ben Affleck Finally Comes Clean - and Shaves His Beard!









02/26/2013 at 12:40 PM EST







Jennifer Garner and Ben Affleck


David Livingston/Getty


And what did Ben Affleck do after his Argo won Best Picture on Sunday night? He took it all off – his facial hair, that is.

A friend of the actor-filmmaker's confirms to PEOPLE that following the Oscars ceremony Affleck, 40, shaved his beard at Craig's restaurant in Hollywood, – where wife Jennifer Garner and pal and Argo co-producer George Clooney were celebrating with him.

"The whole family was tired of [his] beard," says the friend.

Sure enough: "Jen brought clippers!" he added.

According to TMZ.com, the shave took place in the middle of the restaurant's hallway.
Shakthi Jothianandan

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C. Everett Koop, 'rock star' surgeon general, dies


NEW YORK (AP) — Dr. C. Everett Koop has long been regarded as the nation's doctor— even though it has been nearly a quarter-century since he was surgeon general.


Koop, who died Monday at his home in Hanover, N.H., at age 96, was by far the best known and most influential person to carry that title. Koop, a 6-foot-1 evangelical Presbyterian with a biblical prophet's beard, donned a public health uniform in the early 1980s and became an enduring, science-based national spokesman on health issues.


He served for eight years during the Reagan administration and was a breed apart from his political bosses. He thundered about the evils of tobacco companies during a multiyear campaign to drive down smoking rates, and he became the government's spokesman on AIDS when it was still considered a "gay disease" by much of the public.


"He really changed the national conversation, and he showed real courage in pursuing the duties of his job," said Chris Collins, a vice president of amfAR, the Foundation for AIDS Research.


Even before that, he had been a leading figure in medicine. He was one of the first U.S. doctors to specialize in pediatric surgery at a time when children with complicated conditions were often simply written off as untreatable. In the 1950s, he drew national headlines for innovative surgeries such as separating conjoined twins.


His medical heroics are well noted, but he may be better remembered for transforming from a pariah in the eyes of the public health community into a remarkable servant who elevated the influence of the surgeon general — if only temporarily.


"He set the bar high for all who followed in his footsteps," said Dr. Richard Carmona, who served as surgeon general a decade later under President George W. Bush.


Koop's religious beliefs grew after the 1968 death of his son David in a mountain-climbing accident, and he became an outspoken opponent of abortion. His activism is what brought him to the attention of the administration of President Ronald Reagan, who decided to nominate him for surgeon general in 1981. Though once a position with real power, surgeon generals had been stripped of most of their responsibilities in the 1960s.


By the time Koop got the job, the position was kind of a glorified health educator.


But Koop ran with it. One of his early steps involved the admiral's uniform that is bestowed to the surgeon general but that Koop's predecessors had worn only on ceremonial occasions. In his first year in the post, Koop stopped wearing his trademark bowties and suit jackets and instead began wearing the uniform, seeing it as a way to raise the visual prestige of the office.


In those military suits, he surprised the officials who had appointed him by setting aside his religious beliefs and feelings about abortion and instead waging a series of science-based public health crusades.


He was arguably most effective on smoking. He issued a series of reports that detailed the dangers of tobacco smoke, and in speeches began calling for a smoke-free society by the year 2000. He didn't get his wish, but smoking rates did drop from 38 percent to 27 percent while he was in office — a huge decline.


Koop led other groundbreaking initiatives, but perhaps none is better remembered than his work on AIDS.


The disease was first identified in 1981, before Koop was officially in office, and it changed U.S. society. It destroyed the body's immune system and led to ghastly death, but initially was identified in gay men, and many people thought of it as something most heterosexuals didn't have to worry about.


U.S. scientists worked hard to identify the virus and work on ways to fight it, but the government's health education and policy efforts moved far more slowly. Reagan for years was silent on the issue. Following mounting criticism, Reagan in 1986 asked Koop to prepare a report on AIDS for the American public.


His report, released later that year, stressed that AIDS was a threat to all Americans and called for wider use of condoms and more comprehensive sex education, as early as the third grade. He went on to speak frankly about AIDS in an HBO special and engineered the mailing of an educational pamphlet on AIDS to more than 100 million U.S. households in 1988.


Koop personally opposed homosexuality and believed sex should be saved for marriage. But he insisted that Americans, especially young people, must not die because they were deprived of explicit information about how HIV was transmitted.


Koop's speeches and empathetic approach made him a hero to a wide swath of America, including public health workers, gay activists and journalists. Some called him a "scientific Bruce Springsteen." AIDS activists chanted "Koop, Koop" at his appearances and booed other officials.


"I was walking down the street with him one time" about five years ago, recalled Dr. George Wohlreich, director of the College of Physicians of Philadelphia, a medical society with which Koop had longstanding ties. "People were yelling out, 'There goes Dr. Koop!' You'd have thought he was a rock star."


Koop angered conservatives by refusing to issue a report requested by the Reagan White House, saying he could not find enough scientific evidence to determine whether abortion has harmful psychological effects on women.


He got static from some staff at the White House for his actions, but Reagan himself never tried to silence Koop. At a congressional hearing in 2007, Koop spoke about political pressure on the surgeon general post. He said Reagan was pressed to fire him every day.


After his death was reported Monday, the tributes poured forth, including a statement from New York Mayor Michael Bloomberg, who has made smoking restrictions a hallmark of his tenure.


"The nation has lost a visionary public health leader today with the passing of former Surgeon General C. Everett Koop, who was born and raised in Brooklyn," Bloomberg said. "Outspoken on the dangers of smoking, his leadership led to stronger warning labels on cigarettes and increased awareness about second-hand smoke, creating an environment that helped millions of Americans to stop smoking — and setting the stage for the dramatic changes in smoking laws that have occurred over the past decade."


Dr. Anthony Fauci of the National Institutes of Health taught Koop what was known about AIDS during quiet after-hours talks in the early 1980s and became a close friend.


"A less strong person would have bent under the pressure," Fauci said. "He was driven by what's the right thing to do."


Carmona, a surgeon general years later, said Koop was a mentor who preached the importance of staying true to the science in speeches and reports — even when it made certain politicians uncomfortable.


"We remember him for the example he set for all of us," Carmona said.


Koop's nomination originally was met with staunch opposition. Women's groups and liberal politicians complained Reagan had selected him only because of his conservative views, especially his staunch opposition to abortion.


Foes noted that Koop traveled the country in 1979 and 1980 giving speeches that predicted a progression "from liberalized abortion to infanticide to passive euthanasia to active euthanasia, indeed to the very beginnings of the political climate that led to Auschwitz, Dachau and Belsen."


But Koop, a devout Presbyterian, was confirmed as surgeon general after he told a Senate panel he would not use the post to promote his religious ideology. He kept his word and eventually won wide respect with his blend of old-fashioned values, pragmatism and empathy.


Koop was modest about his accomplishments, saying before leaving office in 1989, "My only influence was through moral suasion."


The office declined after that. Few of his successors had his speaking ability or stage presence. Fewer still were able to secure the support of key political bosses and overcome the meddling of everyone else. The office gradually lost prestige and visibility, and now has come to a point where most people can't name the current surgeon general. (It's Dr. Regina Benjamin.)


Even after leaving office, Koop continued to promote public health causes, from preventing childhood accidents to better training for doctors.


"I will use the written word, the spoken word and whatever I can in the electronic media to deliver health messages to this country as long as people will listen," he promised.


In 1996, he rapped Republican presidential hopeful Bob Dole for suggesting that tobacco was not invariably addictive, saying Dole's comments "either exposed his abysmal lack of knowledge of nicotine addiction or his blind support of the tobacco industry."


He maintained his personal opposition to abortion. After he left office, he told medical students it violated their Hippocratic oath. In 2009, he wrote to Senate Majority Leader Harry Reid, urging that health care legislation include a provision to ensure doctors and medical students would not be forced to perform abortions. The letter briefly set off a security scare because it was hand delivered.


Koop served as chairman of the National Safe Kids Campaign and as an adviser to President Bill Clinton's health care reform plan.


Worried that medicine had lost old-fashioned caring and personal relationships between doctors and patients, Koop opened an institute at Dartmouth College in New Hampshire to teach medical students basic values and ethics. He also was a part-owner of a short-lived venture, drkoop.com, to provide consumer health care information via the Internet.


Koop was the only son of a Manhattan banker and the nephew of a doctor. He said by age 5 he knew he wanted to be a surgeon and at age 13 he practiced his skills on neighborhood cats. He attended Dartmouth, where he received the nickname Chick, short for "chicken Koop." It stuck for life.


He received his medical degree at Cornell Medical College, choosing pediatric surgery because so few surgeons practiced it. In 1938, he married Elizabeth Flanagan, the daughter of a Connecticut doctor. They had four children. Koop's wife died in 2007, and he married Cora Hogue in 2010.


He was appointed surgeon-in-chief at Children's Hospital in Philadelphia and served as a professor at the University of Pennsylvania School of Medicine. He pioneered surgery on newborns and successfully separated three sets of conjoined twins. He won national acclaim by reconstructing the chest of a baby born with the heart outside the body.


Although raised as a Baptist, he was drawn to a Presbyterian church near the hospital, where he developed an abiding faith. He began praying at the bedside of his young patients — ignoring the snickers of some of his colleagues.


___


Contributing to this report were Associated Press writers Wilson Ring in Montpelier, Vt.; Jeff McMillan in Philadelphia; and AP Medical Writer Lauran Neergaard in Washington.


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Dow, S&P rise as Bernanke defends policy, warns on cuts

NEW YORK (Reuters) - Stocks mostly rose on Tuesday after Federal Reserve Chairman Ben Bernanke defended the Fed's bond-buying stimulus before Congress, but warned forced spending cuts that could be triggered this week represented a headwind for the economy.


Gains in homebuilders and other consumer stocks, following strong economic data, kept the S&P 500 nearly unchanged, while a 5 percent jump in Home Depot lifted the Dow industrials. The PHLX housing sector index <.hgx> rose 2 percent.


Stocks hit session highs shortly after Bernanke, in testimony before the Senate Banking Committee, strongly defended the Fed's bond-buying stimulus program that has been essential for the stock market's recovery.


However, he also urged lawmakers to avoid sharp spending cuts set to go into effect on Friday, which he warned could combine with earlier tax increases to create a "significant headwind" for the economic recovery.


"He really came down foursquare on the bearish camp with respect to the potential economic impact of these cuts. That's a surprise, and that's probably why the market's a little nervous right now," said Michael Jones, chief investment officer of Riverfront Investment Group in Richmond, Virginia.


The Dow Jones industrial average <.dji> rose 74.64 points or 0.54 percent to 13,858.81. The S&P 500 <.spx> gained 1.78 points or 0.12 percent to 1,489.63. The Nasdaq Composite <.ixic> dropped 5.84 points or 0.19 percent to 3,110.41.


The S&P 500 failed to move above 1,500, a closely watched level that was technical support until recently, but could now become a hurdle.


Cable network AMC Networks was the Nasdaq's biggest percentage decliner after the home of popular shows such as "The Walking Dead" and "Mad Men" reported a quarterly profit way below analysts' estimates. Its stock fell 7.4 percent to $53.77.


Equities continued to be weighed by concerns about a stalemate in Italy after a general election failed to give any party a parliamentary majority, posing the threat of prolonged instability and European financial crisis.


The FTSEurofirst-300 index of top European shares <.fteu3> unofficially closed down 1.3 percent at 1,150.58. The benchmark Italian index <.ftmib> tumbled 4.9 percent.


Dow component Home Depot Inc was the top gainer in both the Dow and the S&P 500 after the world's largest home improvement chain reported adjusted earnings and sales that beat expectations. Home Depot's shares jumped 5.5 percent to $67.46.


Macy's Inc shares climbed 2.8 percent to $39.60 after the department-store chain stated it expects full-year earnings to be above analysts' forecasts because of strong holiday sales.


Economic reports that showed strength in housing and consumer confidence also supported stocks.


U.S. home prices rose more than expected in December, according to the S&P/Case-Shiller index. Consumer confidence rebounded in February, jumping more than expected, and new-home sales rose to their highest in 4-1/2 years.


(Reporting by Rodrigo Campos; Additional reporting by Sam Forgione; Editing by Jan Paschal)



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Jennifer Aniston: The Real Reason I Loved My Oscar Gown







Style News Now





02/25/2013 at 01:10 AM ET











Jennifer Aniston Oscars gownJason Merritt/Getty


Need another reason to love Jennifer Aniston — and her elegant Oscars gown? Just wait until you hear why she picked it: “It fits, it’s comfortable and it’s easy to pee in,” the superstar joked to PEOPLE of her Valentino dress. “You just lift, hoist and do a couple squats!”


Can’t argue with that logic, but wait, there’s more! When fiancĂ© Justin Theroux prompted her, “It’s Valentino red,” she agreed: “Yes, Valentino red! I just loved the color.” No wonder she loves the guy — he’s cute, funny and is well-versed in designers’ signature shades!


RELATED PHOTOS: The Most Fabulous Oscar Party Dresses


That vivid hue is also the reason PEOPLE StyleWatch editors admired Aniston’s dramatic, full-skirted gown. She normally favors neutral looks, so her striking scarlet dress was even more of a standout on a night that featured a lot of subdued shades.


For much more scoop from Aniston (when is that wedding going to be, anyway?) check out this week’s issue of PEOPLE magazine.


Tell us: Did you love Aniston’s Valentino gown? Do you appreciate her favorite thing about it?


–Alex Apatoff, reporting by Aili Nahas


RELATED PHOTOS: 10 Unforgettable Oscars Quotes




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FDA approves new targeted breast cancer drug


WASHINGTON (AP) — The Food and Drug Administration has approved a first-of-a-kind breast cancer medication that targets tumor cells while sparing healthy ones.


The drug Kadcyla from Roche combines the established drug Herceptin with a powerful chemotherapy drug and a third chemical linking the medicines together. The chemical keeps the cocktail intact until it binds to a cancer cell, delivering a potent dose of anti-tumor poison.


Cancer researchers say the drug is an important step forward because it delivers more medication while reducing the unpleasant side effects of chemotherapy.


"This antibody goes seeking out the tumor cells, gets internalized and then explodes them from within. So it's very kind and gentle on the patients — there's no hair loss, no nausea, no vomiting," said Dr. Melody Cobleigh of Rush University Medical Center. "It's a revolutionary way of treating cancer."


Cobleigh helped conduct the key studies of the drug at the Chicago facility.


The FDA approved the new treatment for about 20 percent of breast cancer patients with a form of the disease that is typically more aggressive and less responsive to hormone therapy. These patients have tumors that overproduce a protein known as HER-2. Breast cancer is the second most deadly form of cancer in U.S. women, and is expected to kill more than 39,000 Americans this year, according to the National Cancer Institute.


The approval will help Roche's Genentech unit build on the blockbuster success of Herceptin, which has long dominated the breast cancer marketplace. The drug had sales of roughly $6 billion last year.


Genentech said Friday that Kadcyla will cost $9,800 per month, compared to $4,500 per month for regular Herceptin. The company estimates a full course of Kadcyla, about nine months of medicine, will cost $94,000.


FDA scientists said they approved the drug based on company studies showing Kadcyla delayed the progression of breast cancer by several months. Researchers reported last year that patients treated with the drug lived 9.6 months before death or the spread of their disease, compared with a little more than six months for patients treated with two other standard drugs, Tykerb and Xeloda.


Overall, patients taking Kadcyla lived about 2.6 years, compared with 2 years for patients taking the other drugs.


FDA specifically approved the drug for patients with advanced breast cancer who have already been treated with Herceptin and taxane, a widely used chemotherapy drug. Doctors are not required to follow FDA prescribing guidelines, and cancer researchers say the drug could have great potential in patients with earlier forms of breast cancer


Kadcyla will carry a boxed warning, the most severe type, alerting doctors and patients that the drug can cause liver toxicity, heart problems and potentially death. The drug can also cause severe birth defects and should not be used by pregnant women.


Kadcyla was developed by South San Francisco-based Genentech using drug-binding technology licensed from Waltham, Mass.-based ImmunoGen. The company developed the chemical that keeps the drug cocktail together and is scheduled to receive a $10.5 million payment from Genentech on the FDA decision. The company will also receive additional royalties on the drug's sales.


Shares of ImmunoGen Inc. rose 2 cents to $14.32 in afternoon trading. The stock has ttraded in a 52-wek range of $10.85 to $18.10.


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Wall Street dips on uncertain Italian election

NEW YORK (Reuters) - Stocks edged lower on Monday after fears of a divided parliament in Italy, the euro zone's third-largest economy, rekindled worries about the currency union's stability.


The center-right coalition led by former prime minister Silvio Berlusconi was leading in the race for the Italian Senate, dashing hopes of a pro-reform, center-left victory seen as crucial to dig the euro zone out of a debt crisis.


The market had hoped for a center-left victory because it would continue the path to pay down Italian debt, said Art Hogan, managing director of Lazard Capital Markets in New York.


"What we don't want to hear is a renewed fear about a euro zone fracture," he said.


The S&P 500 was nonetheless near highs not seen in five years, and bets on a strong U.S. economy have given equities support. The S&P 500's slight fall last week was the first weekly drop after a seven-week string of gains.


Barnes & Noble Inc climbed 9 percent to $14.73 after its chairman offered to buy the bookseller's declining retail business.


The Dow Jones industrial average <.dji> fell 22.5 points or 0.16 percent, to 13,978.07, the S&P 500 <.spx> lost 2.15 points or 0.14 percent, to 1,513.45 and the Nasdaq Composite <.ixic> added 3.18 points or 0.1 percent, to 3,164.99.


The Nasdaq received support from Amgen Inc , up 3.8 percent to $90.16 after a voluntary recall from a competitor to its top-selling red blood cell booster Epogen.


European shares <.fteu3> trimmed gains, edging up 0.1 percent and Italy's main FTSE MIB <.ftmib> was up 0.7 percent after earlier gaining near 4 percent.


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


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


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Reporting by Rodrigo Campos; Editing by Kenneth Barry)



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