Asia shares set for best week in 2 months as outlook improves

SINGAPORE (Reuters) - Asian shares ambled higher on Friday and were on course for a weekly gain of more than 2 percent, their best in two months, after manufacturing surveys from China and the United States raised hopes that the global growth outlook is improving at last.

The euro was also enjoying a positive week, despite data on Thursday pointing to the euro zone sliding into its deepest recession since 2009, with the currency standing up more than 1 percent on last Friday's close on optimism that a funding deal for debt-choked Greece will ultimately be agreed.

Activity was subdued across financial markets on Friday, with a public holiday in Japan and U.S. trading curtailed by the long Thanksgiving weekend.

MSCI's broadest index of Asia Pacific shares outside Japan <.miapj0000pus> rose 0.4 percent, with shares in South Korea <.ks11> and Hong Kong <.hsi> both posting modest gains while Australian stocks <.axjo> slipped 0.1 percent. <.ks><.ax><.hk/>

"I suspect profit-taking will probably be a dominant factor at play in the market today," said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

The MSCI index was up around 2.3 percent on the week, its best weekly performance since mid-September.

Confidence in the global economic outlook got its biggest boost from Thursday's HSBC flash manufacturing Purchasing Managers Index (PMI) for China, which showed expansion in the factory sector accelerating for the first time in 13 months, broadly lifting riskier assets such as stocks and commodities.

The Chinese data followed a report on Wednesday showing U.S. manufacturing grew in November at its quickest pace in five months, indicating strong economic growth in the fourth quarter.

PMI data on the manufacturing and services sectors in Europe's two biggest economies, Germany and France, added to the better tone, revealing that conditions had not worsened in November, though both economies were still contracting.

However, the PMI numbers for the wider euro zone remained extremely weak, pointing to its recession-hit economy shrinking by about 0.5 percent in the current quarter - its sharpest contraction since the first quarter of 2009.

GREEK RISKS

The euro was steady against the dollar around $1.2884, within sight of Thursday's three-week high of $1.2899.

The single currency was boosted by expectations that international lenders will soon reach a deal to release the next tranche of aid for Greece, although some market players remained cautious about the risks still posed by Europe's debt crisis.

"Greek exit (from the euro zone) is very unlikely this weekend, but I don't want to go into this weekend holding any risky positions," said RBS strategist Greg Gibbs in a note.

"In fact, while much ink has been spilled on the U.S. fiscal cliff, the bigger risk is still cracks appearing again in Europe."

The euro dipped 0.1 percent versus the yen to 106.11 yen, backing away from a six-and-a-half-month high of 106.585 yen set on Thursday.

The dollar eased 0.1 percent versus the yen to 82.39 yen, pulling away from Thursday's high of 82.84 yen, the dollar's strongest level since early April.

The dollar has climbed roughly 3.6 percent against the yen in the last two weeks, with the yen weakened by market expectations that the likely next Japanese government would push the Bank of Japan to implement more drastic monetary stimulus.

Commodity markets were quiet, with oil and copper easing a little but staying on course to end the week higher than they started.

Gold was flat around $1,730 an ounce.

(Editing by Eric Meijer)

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Gaza ceasefire holds but mistrust runs deep

GAZA/JERUSALEM (Reuters) - A ceasefire between Israel and Hamas held firm on Thursday with scenes of joy among the ruins in Gaza over what Palestinians hailed as a victory, and both sides saying their fingers were still on the trigger.

In the sudden calm, Palestinians who had been under Israeli bombs for eight days poured into Gaza streets for a celebratory rally, walking past wrecked houses and government buildings.

But as a precaution, schools stayed closed in southern Israel, where nerves were jangled by warning sirens - a false alarm, the army said - after a constant rain of rockets during the most serious Israeli-Palestinian fighting in four years.

Israel had launched its strikes last week with a declared aim of ending rocket attacks on its territory from Gaza, ruled by the Islamist militant group Hamas, which denies Israel's right to exist. Hamas had responded with more rockets.

The truce brokered by Egypt's new Islamist leaders, working with the United States, headed off an Israeli invasion of Gaza.

It was the fruit of intensive diplomacy spurred by U.S. President Barack Obama, who sent his secretary of state to Cairo and backed her up with phone calls to Israeli Prime Minister Benjamin Netanyahu and Egyptian President Mohamed Mursi.

Mursi's role in cajoling his Islamist soulmates in Gaza into the U.S.-backed deal with Israel suggested that Washington can find ways to cooperate with the Muslim Brotherhood leader whom Egyptians elected after toppling former U.S. ally Hosni Mubarak, a bulwark of American policy in the Middle East for 30 years.

Mursi, preoccupied with Egypt's economic crisis, cannot afford to tamper with a 1979 peace treaty with Israel, despite its unpopularity with Egyptians, and needs U.S. financial aid.

MORE DEATHS

Despite the quiet on the battlefield, the death toll from the Gaza conflict crept up on both sides.

The body of Mohammed al-Dalu, 25, was recovered from the rubble of a house where nine of his relatives - four children and five women - were killed by an Israeli bomb this week.

That raised to 163 the number of Palestinians killed, more than half of them civilians, including 37 children, during the Israeli onslaught, according to Gaza medical officials.

Nearly 1,400 rockets struck Israel, killing four civilians and two soldiers, including an officer who died on Thursday of wounds sustained the day before, the Israeli army said.

Israel dropped 1,000 times as much explosive on the Gaza Strip as landed on its soil, Defense Minister Ehud Barak said.

Municipal workers in Gaza began cleaning streets and removing the rubble of bombed buildings. Stores opened and people flocked to markets to buy food.

Jubilant crowds celebrated, with most people waving green Hamas flags but some carrying the yellow emblems of the rival Fatah group, led by Western-backed President Mahmoud Abbas.

That marked a rare show of unity five years after Hamas, which won a Palestinian poll in 2006, forcibly wrested Gaza from Fatah, still dominant in the Israeli-occupied West Bank.

Israel began ferrying tanks northwards, away from the border, on transporters. It plans to discharge gradually tens of thousands of reservists called up for a possible Gaza invasion.

But trust between Israel and Hamas remains in short supply and both said they might well have to fight again.

"The battle with the enemy has not ended yet," Abu Ubaida, spokesman of Hamas's armed wing Izz el-Deen Al-Qassam Brigades, said at an event to mourn its acting military chief Ahmed al-Jaabari, whose killing by Israel on November 14 set off this round.

"HANDS ON TRIGGER"

The exiled leader of Hamas, Khaled Meshaal, said in Cairo his Islamist movement would respect the truce, but warned that if Israel violated it "our hands are on the trigger".

Netanyahu said he had agreed to "exhaust this opportunity for an extended truce", but told Israelis a tougher approach might be required in the future.

Facing a national election in two months, he swiftly came under fire from opposition politicians who had rallied to his side during the fighting but now contend he emerged from the conflict with no real gains for Israel.

"You don't settle with terrorism, you defeat it. And unfortunately, a decisive victory has not been achieved and we did not recharge our deterrence," Shaul Mofaz, leader of the main opposition Kadima party, wrote on his Facebook page.

In a speech, Ismail Haniyeh, Hamas's prime minister in Gaza, urged all Palestinian factions to respect the ceasefire and said his government and security services would monitor compliance.

According to a text of the agreement seen by Reuters, both sides should halt all hostilities, with Israel desisting from incursions and targeting of individuals, while all Palestinian factions should cease rocket fire and cross-border attacks.

The deal also provides for easing Israeli curbs on Gaza's residents, but the two sides disagreed on what this meant.

Israeli sources said Israel would not lift a blockade of the enclave it enforced after Hamas won a Palestinian election in 2006, but Meshaal said the deal covered the opening of all of the territory's border crossings with Israel and Egypt.

Israel let dozens of trucks carry supplies into the Palestinian enclave during the fighting. Residents there have long complained that Israeli restrictions blight their economy.

Barak said Hamas, which declared November 22 a national holiday to mark its "victory", had suffered heavy military blows.

"A large part of the mid-range rockets were destroyed. Hamas managed to hit Israel's built-up areas with around a metric tone of explosives, and Gaza targets got around 1,000 metric tonnes," he said.

He dismissed a ceasefire text published by Hamas, saying: "The right to self-defense trumps any piece of paper."

He appeared to confirm, however, a Hamas claim that the Israelis would no longer enforce a no-go zone on the Gaza side of the frontier that the army says has prevented Hamas raids.

(Additional reporting by Noah Browning in Gaza, Ori Lewis, Crispian Balmer and Dan Williams in Jerusalem; Writing by Jeffrey Heller and Alistair Lyon; Editing by Giles Elgood)

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Exclusive: TV networks start seven-day ratings push with advertisers

LOS ANGELES (Reuters) – U.S. television broadcast networks are taking the first steps to persuade advertisers to pay for commercial viewership that occurs up to seven days after a program airs, a shift that would provide a new revenue stream to help combat ratings erosion.

The networks argue that the rising popularity of digital video recorders is pushing a sizeable number of viewers to delay watching their favorite programs beyond the first three days, the time period most often used for calculating ad payments.

Some advertisers are ready to make the move to a seven-day metric. One of the big four networks, Walt Disney Co’s ABC, earlier this year reached deals with some sponsors that bring in payments for eyeballs counted between days four and seven.

The other broadcasters have begun talks with advertisers and hope to convince them to switch to the longer window in time for the “upfront” selling season that starts early next year, when billions of dollars in ad commitments will be made, according to people familiar with the discussions.

Since 2007, most TV ad time has been bought and sold based on “C3,” a ratings measurement based of the average number of commercial minutes watched during a program either live or within three days of its airing.

TV networks want advertisers to shift to “C7,” which captures commercials watched within seven days.

Advertisers hesitate to pay for the added days, particularly for time-sensitive ads pitching a department store’s one-day sale or the opening of a summer movie blockbuster. Media buyers are pushing for precise measurements of each commercial viewed, rather than an average for an entire program, as well as a tabulation of how many people are watching on mobile devices.

The debate intensified after Nielsen data showed a sharp decline in three-day viewing at the start of the fall TV season compared with last year.

The drop is partly due to “the greater penetration of DVRs and the greater usage of DVRs, which clearly have shifted the rating in the direction of C3, and ultimately, hopefully, C7,” Disney CEO Bob Iger told analysts on a November 8 conference call.

Most viewing of network prime time shows still takes place within three days. But the post-three day viewers are growing and can be significant. Ratings for ABC comedy hit “Modern Family” increased by 5 percent, to 6.5 million viewers age 18 to 49 viewers, when counted by the C7 measurement instead of C3.

The later viewers also are among the most-coveted by advertisers, according to ABC research, which showed people who watched a show after three days were more highly educated and had higher incomes. For days four through seven, “the people who are doing the viewing are some of the most desirable available from an advertiser’s perspective,” said Charles Kennedy, senior vice president of research for ABC and the ABC Family cable network.

Earlier this year, ABC made deals with some sponsors to pay for ad time based on C7 numbers, ABC spokesman Kevin Brockman said. “We expect to do more of them if they make sense for us and our clients,” Brockman said.

At CBS, the flagship network of CBS Corp, CEO Leslie Moonves has been outspoken in pressing for a C7 metric and said it “represents a significant opportunity for us that is still in the very early stages.”

“As we move forward, we will make it a priority to get paid for all of the viewing that is going on across our shows, including DVR viewing beyond C3,” Moonves told analysts on a November 7 conference call.

Advertisers are not ready to commit to the switch and will be looking for something in return if they agree to a longer window. Timing is a big concern for many brands that want to get a message out to large numbers of consumers during a specific time period. Some commercials lose their value for sponsors over a few days.

“In moving to C7, you’ve got to be careful because you are taking away some of the advantage of why clients buy television,” said Sam Armando, director of strategic intelligence for SMGx, a division of media buying agency Starcom MediaVest Group.

Advertisers believe simply adding more days to the current metric fails to adequately capture viewership. Brands are lobbying for a more precise measurement that tracks viewership of each commercial, rather than an average for a program over a time period, they say. They also want information on how many people see their ads on programs watched on computers or Internet-connected mobile devices like phones and tablets.

“If the industry is going to make a move, we need to consider it all before we just make a little baby step to C7,” Armando said.

(Reporting By Lisa Richwine; Edited by Ronald Grover and Andrew Hay)

Gadgets News Headlines – Yahoo! News

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Mayim Bialik and Michael Stone Divorcing

By Mike Fleeman

11/21/2012 at 05:00 PM EST

After "much consideration and soul-searching," Mayim Bialik announced Wednesday that she and husband Michael Stone are divorcing after nine years of marriage.

The Big Bang Theory star, who has sons Miles, 7, and Fred, 4, with Stone, cites "irreconcilable differences" for the split, which she revealed in a statement on her Kveller.com parenting blog.

"Divorce is terribly sad, painful and incomprehensible for children. It is not something we have decided lightly," she writes.

The former star of TV's Blossom, 36, also says that the split is not due to the attachment parenting she discusses in her book Beyond the Sling. "Relationships are complicated no matter what style of parenting you choose," she says.

"The main priority for us now is to make the transition to two loving homes as smooth and painless as possible," Bialik, 36, continues. "Our sons deserve parents committed to their growth and health and that’s what we are focusing on. Our privacy has always been important and is even more so now, and we thank you in advance for respecting it as we negotiate this new terrain."

She concludes by saying, "We will be ok."

The couple were married in August 2003 in Pasadena, Calif.

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Study finds mammograms lead to unneeded treatment

Mammograms have done surprisingly little to catch deadly breast cancers before they spread, a big U.S. study finds. At the same time, more than a million women have been treated for cancers that never would have threatened their lives, researchers estimate.

Up to one-third of breast cancers, or 50,000 to 70,000 cases a year, don't need treatment, the study suggests.

It's the most detailed look yet at overtreatment of breast cancer, and it adds fresh evidence that screening is not as helpful as many women believe. Mammograms are still worthwhile, because they do catch some deadly cancers and save lives, doctors stress. And some of them disagree with conclusions the new study reached.

But it spotlights a reality that is tough for many Americans to accept: Some abnormalities that doctors call "cancer" are not a health threat or truly malignant. There is no good way to tell which ones are, so many women wind up getting treatments like surgery and chemotherapy that they don't really need.

Men have heard a similar message about PSA tests to screen for slow-growing prostate cancer, but it's relatively new to the debate over breast cancer screening.

"We're coming to learn that some cancers — many cancers, depending on the organ — weren't destined to cause death," said Dr. Barnett Kramer, a National Cancer Institute screening expert. However, "once a woman is diagnosed, it's hard to say treatment is not necessary."

He had no role in the study, which was led by Dr. H. Gilbert Welch of Dartmouth Medical School and Dr. Archie Bleyer of St. Charles Health System and Oregon Health & Science University. Results are in Thursday's New England Journal of Medicine.

Breast cancer is the leading type of cancer and cause of cancer deaths in women worldwide. Nearly 1.4 million new cases are diagnosed each year. Other countries screen less aggressively than the U.S. does. In Britain, for example, mammograms are usually offered only every three years and a recent review there found similar signs of overtreatment.

The dogma has been that screening finds cancer early, when it's most curable. But screening is only worthwhile if it finds cancers destined to cause death, and if treating them early improves survival versus treating when or if they cause symptoms.

Mammograms also are an imperfect screening tool — they often give false alarms, spurring biopsies and other tests that ultimately show no cancer was present. The new study looks at a different risk: Overdiagnosis, or finding cancer that is present but does not need treatment.

Researchers used federal surveys on mammography and cancer registry statistics from 1976 through 2008 to track how many cancers were found early, while still confined to the breast, versus later, when they had spread to lymph nodes or more widely.

The scientists assumed that the actual amount of disease — how many true cases exist — did not change or grew only a little during those three decades. Yet they found a big difference in the number and stage of cases discovered over time, as mammograms came into wide use.

Mammograms more than doubled the number of early-stage cancers detected — from 112 to 234 cases per 100,000 women. But late-stage cancers dropped just 8 percent, from 102 to 94 cases per 100,000 women.

The imbalance suggests a lot of overdiagnosis from mammograms, which now account for 60 percent of cases that are found, Bleyer said. If screening were working, there should be one less patient diagnosed with late-stage cancer for every additional patient whose cancer was found at an earlier stage, he explained.

"Instead, we're diagnosing a lot of something else — not cancer" in that early stage, Bleyer said. "And the worst cancer is still going on, just like it always was."

Researchers also looked at death rates for breast cancer, which declined 28 percent during that time in women 40 and older — the group targeted for screening. Mortality dropped even more — 41 percent — in women under 40, who presumably were not getting mammograms.

"We are left to conclude, as others have, that the good news in breast cancer — decreasing mortality — must largely be the result of improved treatment, not screening," the authors write.

The study was paid for by the study authors' universities.

"This study is important because what it really highlights is that the biology of the cancer is what we need to understand" in order to know which ones to treat and how, said Dr. Julia A. Smith, director of breast cancer screening at NYU Langone Medical Center in New York. Doctors already are debating whether DCIS, a type of early tumor confined to a milk duct, should even be called cancer, she said.

Another expert, Dr. Linda Vahdat, director of the breast cancer research program at Weill Cornell Medical College in New York, said the study's leaders made many assumptions to reach a conclusion about overdiagnosis that "may or may not be correct."

"I don't think it will change how we view screening mammography," she said.

A government-appointed task force that gives screening advice calls for mammograms every other year starting at age 50 and stopping at 75. The American Cancer Society recommends them every year starting at age 40.

Dr. Len Lichtenfeld, the cancer society's deputy chief medical officer, said the study should not be taken as "a referendum on mammography," and noted that other high-quality studies have affirmed its value. Still, he said overdiagnosis is a problem, and it's not possible to tell an individual woman whether her cancer needs treated.

"Our technology has brought us to the place where we can find a lot of cancer. Our science has to bring us to the point where we can define what treatment people really need," he said.

___

Online:

Study: http://www.nejm.org/doi/full/10.1056/NEJMoa1206809

Screening advice: http://www.uspreventiveservicestaskforce.org/uspstf/uspsbrca.htm

___

Marilynn Marchione can be followed at http://twitter.com/MMarchioneAP

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Asian shares rise on firm China, U.S. factory data

TOKYO (Reuters) - Asian shares rose on Thursday as a survey showed China's manufacturing sector expanded for the first time in 13 months in November, adding to optimism after firm U.S. factory data that the global growth slowdown may have turned a corner.

MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> extended early gains to rise 0.8 percent to a one-week high.

Regional equities markets had already been buoyed by recovering risk appetite on easing tension in the Middle East and hopes that a Greece bailout will be agreed next week.

Resources-sensitive Australian shares <.axjo> surged 1.3 percent to a one-week high as miners climbed. London copper rose 0.5 percent to $7,732.75 a tonne while spot gold inched up 0.2 percent to $1,731.34 an ounce.

The China HSBC Flash Manufacturing Purchasing Managers Index rose to a 13-month high of 50.4 in November, indicating factory activity was picking up and pointing to a reviving economic growth after seven consecutive quarters of slowing. A sub-index measuring output rose to 51.3, also the highest since October 2011.

"The data suggests the China's growth had hit a bottom in the third quarter and prospects are brightening for small and medium-sized firms in China," said Naohiro Niimura, a partner at research and consulting firm Market Risk Advisory.

While the report is positive, the rise in prices of base metals, for which China is the world's top consumer, will be contained given the high level of Chinese inventories, he said.

"But shares get a boost because they are driven by sentiment and because contained base metal prices under an improving economy will help companies boost their earnings," Niimura said.

Japan's Nikkei stock average <.n225> jumped 1.2 percent to a 6-1/2-month high as exporters were lifted by hopes the weakening yen would boost their earnings. <.t/>

The yen has come under pressure since the Japanese government announced a December 16 election last week.

The opposition Liberal Democratic Party, which is tipped to win, on Wednesday promised a big extra budget and a policy accord with the central bank on aggressive monetary stimulus to prevent the economy from sliding into recession.

The yen fell to a 7-1/2-month low versus the dollar of 82.59 on Thursday, while the yen also hit a 6-1/2-month low of 106.26 yen against the euro.

"Yen, I think, is being driven by anticipation of LDP led government forcing aggressive monetary easing," said Marc Chandler, global head of currency strategy at Brown Brothers Harriman in New York.

Traders said the markets may be capped as activity slows ahead of the U.S. Thanksgiving holiday weekend.

Niimura said as hedge funds close their books this month and next, any swing in prices should be seen as more related to their position adjustments than a change in real risk appetite.

GREECE DEAL AWAITED

European shares <.fteu3> rose for a third straight session on Wednesday as investors bet on a positive outcome to negotiations over aid to Greece after German Chancellor Angela Merkel said a deal to release emergency aid to Greece was still possible next Monday when euro ministers meet.

The expectations of a Greek deal helped the euro rebound to a two-week high against the dollar of $1.28685, after being initially sold off after international lenders to Greece failed to reach a deal to release the aid on Wednesday.

"Efforts to avert a Greek default may provide short-term relief for the euro, but the measures will only help to buy more time as Greece persistently seeks further external assistance," said David Song, currency analyst at DailyFX, who is maintaining a bearish view on the single currency.

Overnight, U.S. stocks ended modestly higher but volume was one of the year's lowest on the day ahead of the U.S. Thanksgiving holiday.

U.S. manufacturing grew in November at its quickest pace in five months, with a rise in domestic demand hinting that factories could provide a boost to economic growth in the fourth quarter, while those from Europe are due out later on Thursday.

A ceasefire between Israel and Gaza's Hamas rulers took hold on Thursday after eight days of conflict, easing concerns about supply from oil-producing Middle East.

U.S. crude rose 0.3 percent to $87.66 a barrel while Brent inched up 0.2 percent to $111.06.

A rallying stock market boosted sentiment in Asian credit markets, tightening the spreads on the iTraxx Asia ex-Japan investment-grade index by 3 basis points.

(Additional reporting by Ian Chua in Sydney and Dominic Lau and Lisa Twaronite in Tokyo; Editing by Kim Coghill)

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Eric Stonestreet Wasn’t Drunk, He Swears

We realize there’s only so much time one can spend in a day watching new trailers, viral video clips, and shaky cell phone footage of people arguing on live television. This is why every day The Atlantic Wire highlights the videos that truly earn your five minutes (or less) of attention. Today:

RELATED: What Happens When You Sing ‘All Night Long’ All Night Long

So if you were one of the few people watching the American Music Awards, (which no one watched) you may have seen Eric Stonestreet be a little tipsy. But that isn’t half as enjoyable as watching Eric Stonestreet watching himself be a little tipsy that night. (Also, wow, he’s sort of a bro.)

RELATED: Modern Family Is Scary

RELATED: ‘Seven Psychocats’ and the 50 Best Bond Moments in 007 Minutes

A few days ago we found out that Paul Rudd was in play called Grace on Broadway because … (wait for it) someone in the balcony puked on the audience members during the play. Four days late we can laugh at the whole thing. Mostly because we weren’t barfed on: 

RELATED: A ‘Mad Men’ Rickroll and the Man That Destroys Carnival Games

RELATED: A Video to Restore Our Faith in Humanity and a Glacier Tsunami

Here’s how to make some magic. What you’ll need: 

(1) Canadian newscaster with chubby fingers

(1) Technology

(1) Drunk piece of technology

Voila: 

And finally. Thanksgiving is upon us!  Today we’re thankful for squirrels who like to eat plastic: 

Wireless News Headlines – Yahoo! News

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The Voice: Top Eight Contestants Revealed

TV Watch

By Julia Haskins

11/20/2012 at 10:05 PM EST

From left: Adam Levine, Cee Lo Green, Christina Aguilera, Blake Shelton and host Carson Daly

Mark Seliger/NBC

Following what Blake Shelton called the "best episode of The Voice we've ever had", spirited group performances on Tuesday night's show kept the energy up and distracted viewers just long enough from the business at hand – impending eliminations.

Christina Aguilera brought the heat with her song "Let There Be Love." Rascal Flatts shared their hit "Changed." Later, Adam Levine performed a rendition of Queen's "Crazy Little Thing Called Love," followed by the contestants taking on Pat Benatar's "Hit Me with Your Best Shot."

But once again, the decisions about who would stay and who would go were completely up to the viewers. No input from the coaches could save contestants this time. Keep reading to find out which contestants will sing again next week ...

The first round of results turned out to be good news for Nicholas David and Cassadee, later joined by Dez Duron and Cody Belew in the top eight.

America also gave Terry McDermott, Melanie Martinez, Trevin Hunte and Amanda Brown another shot at superstardom.

That means Bryan Keith and Sylvia Yacoub won't be singing again on Monday night's episode.

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Asian shares ease on uncertainty over Greek bailout, U.S. fiscal cliff

TOKYO (Reuters) - Asian shares eased on Wednesday as investors refocused on the euro zone debt crisis after European officials failed to reach a deal on a bailout for Greece, while Federal Reserve Chairman Ben Bernanke highlighted the dangers of a U.S. fiscal crisis.

The euro fell 0.4 percent to $1.2759, extending losses and retreating further from Tuesday's two-week high of $1.28295.

Euro zone finance ministers will meet again on Monday, after their meeting in Brussels ended on Wednesday without an agreement on the next tranche of loans to Greece.

"The euro is being sold because markets had believed the ministers would agree on aid for Greece at today's meeting," said Yuji Saito, director of foreign exchange at Credit Agricole in Tokyo. "Instead, a settlement is postponed, highlighting the difficulty of getting consensus on the debt crisis. But I feel this is a typical European political show and an agreement will be reached."

The bearish news from Europe dragged down Asian shares, whose two-day rise had already been stalled by Bernanke on Tuesday repeating a warning that failure to avoid the $600 billion "fiscal cliff" in expiring tax cuts and government spending reductions could lead to recession in the United States.

The Fed chief said worries over how budget negotiations will be resolved were already damaging growth.

He also reiterated the Fed's guidance for keeping interest rates near zero until at least mid-2015, but offered few clues as to how the central bank might tweak its bond-purchase program at the start of next year.

Worries about the United States failing to raise its debt ceiling rattled financial markets in August 2011 and prompted Standard & Poor's to cut the top-notch U.S. government bond rating for the first time ever.

But Hirokazu Yuihama, a senior strategist at Daiwa Securities, said that for all the concerns over the fiscal cliff, most of the market expected the U.S. Congress to reach a compromise to avert the crisis.

MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> slipped 0.3 percent, after holding nearly flat earlier. Hong Kong <.hsi> shares bucked the falling trend but pared earlier gains to rise 0.2 percent.

Japan's Nikkei stock average <.n225> was up 0.4 percent, after rising to a two-month high as exporters were buoyed by a weaker yen. The yen has come under pressure on expectations that a general election on December 16 will result in victory for an opposition leader who wants the Bank of Japan to aggressively ease monetary policy. <.t/>

Daiwa's Yuihama said concerns over third-quarter earnings have subsided as most Asian companies had already reported results.

"This has prompted investors to turn to economic fundamentals. Signs of recovery in the U.S. and China are offering some assurances that the global economic slump may not be as severe as previously feared, even if growth remains fragile," Yuihama said.

YEN WEAKNESS PERSISTS

Trading activity was slowing ahead of the U.S. Thanksgiving long weekend.

Going into the holiday, the dollar has been underpinned broadly by data indicating a moderate U.S. recovery taking root, while the yen remained under pressure, with more data showing Japan's economy struggling.

Japan's exports fell 6.5 percent in October from a year ago, dropping for a fifth consecutive month, weighed down by weakening global demand and a territorial row with China, its main customer.

In the U.S. on Tuesday, a report showed U.S. housing starts rose to the highest rate in more than four years in October.

The dollar rose to a seven-month high against the yen of 81.955 yen while the euro briefly touched a peak of 105.05 yen, its highest point since May 4.

A retreat in shares dragged oil lower. U.S. crude futures pared earlier gains to be up 0.1 percent to $86.80 a barrel and Brent crude also trimmed earlier rises to be up 0.13 percent at $109.90.

(Editing by Simon Cameron-Moore)

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Gaza shakes, Israelis killed as Clinton seeks truce

GAZA/JERUSALEM (Reuters) - Israeli air strikes shook the Gaza Strip and Palestinian rockets struck across the border as U.S. Secretary of State Hillary Clinton held talks in Jerusalem in the early hours of Wednesday, seeking a truce that can hold back Israel's ground troops.

Hamas, the Islamist movement controlling Gaza, and Egypt, whose new, Islamist government is trying to broker a truce, had floated hopes for a ceasefire by late Tuesday; but by the time Clinton met Israeli Prime Minister Benjamin Netanyahu it was clear there would be more argument, and more violence, first.

Hamas leaders in Cairo accused the Jewish state of failing to respond to proposals and said an announcement on holding fire would not come before daylight on Wednesday. Israel Radio quoted an Israeli official saying a truce was held up due to "a last-minute delay in the understandings between Hamas and Israel".

An initial halt to attacks may, however, not see the sides stand their forces down from battle stations immediately; Clinton, who flies to Cairo to see Egyptian President Mohamed Mursi later on Wednesday, spoke of a deal "in the days ahead".

As she arrived in Israel after nightfall, Israel was stepping up its bombardment. Artillery shells and missiles fired from naval gunboats offshore slammed into the territory and air strikes came at a frequency of about one every 10 minutes.

After seven days of hostilities that have killed over 130 Palestinians and five Israelis, two of these on Tuesday, both sides are looking for more than a return to the sporadic calm that has prevailed across the blockaded enclave since Israel ended a much bloodier air and ground offensive four years ago.

ELECTION

Netanyahu, who faces an election in two months that he is, for now, favored to win, told Clinton he wanted a "long-term" solution. Failing that, Netanyahu made clear, he stood ready to step up the military campaign to silence Hamas's rockets.

Hamas for its part is exploring the opportunities that last year's Arab Spring has given it to enjoy favor from the new Islamist governments of states once ruled by U.S. proteges, and from Sunni Gulf powers keen to woo it away from Shi'ite Iran. It has used longer-range missiles, some sent by Tehran, and hopes to eclipse Western-backed Palestinian President Mahmoud Abbas.

Hamas has spoken of an easing of Israel's blockade on the 40-km (25-mile) slice of Mediterranean coast that is home to 1.7 million people. It may count on some sympathy from Mursi, though Egypt's first freely elected leader, whose Muslim Brotherhood inspired Hamas's founders, has been careful to stick by the 1979 peace deal with Israel struck by Cairo's former military rulers.

Clinton, who broke off from an Asian tour with President Barack Obama and assured Netanyahu of "rock-solid" U.S. support for Israel's security, spoke of seeking a "durable outcome" and of Egypt's "responsibility" for promoting peace.

She repeated international calls for the kind of lasting, negotiated, comprehensive Israeli-Palestinian settlement that has eluded the two peoples for decades - something neither of the two warring parties seems seriously to be anticipating.

"In the days ahead, the United States will work with our partners here in Israel and across the region toward an outcome that bolsters security for the people of Israel, improves conditions for the people of Gaza and moves toward a comprehensive peace for all people of the region," Clinton said.

"It is essential to de-escalate the situation in Gaza. The rocket attacks from terrorist organizations inside Gaza on Israeli cities and towns must end and a broader calm restored.

"The goal must be a durable outcome that promotes regional stability and advances the security and legitimate aspirations of Israelis and Palestinians alike."

"SELF-DEFENCE"

Netanyahu, who has appeared in no immediate rush to repeat the invasion of winter 2008-09 in which over 1,400 Palestinians died, said: "If there is a possibility of achieving a long-term solution to this problem with diplomatic means, we prefer that.

"But if not, I'm sure you understand that Israel will have to take whatever action is necessary to defend its people."

As Israeli aircraft have carried out hundreds of strikes on rocket stores, launchpads and suspected Hamas command posts since assassinating the head of its military wing a week ago, tens of thousands of Israeli soldiers have been preparing tanks and infantry units for a possible invasion.

During the night, explosions again rocked the city of Gaza and other parts of the Strip, while rockets from the enclave, some essentially home-made, others Iranian-designed and smuggled through tunnels from Egypt, landed in southern Israel.

One reached as far as Rishon Lezion, near Tel Aviv, on Tuesday, the latest to jar Israel's metropolis, long untroubled by Palestinian attacks. Another rocket fell close to Jerusalem, the holy city claimed by both sides in the conflict.

Medical officials in Gaza said 31 Palestinians were killed on Tuesday. An Israeli soldier and a civilian died when rockets exploded near the Gaza frontier, police and the army said.

Gaza medical officials say 138 people have died in Israeli strikes, mostly civilians, including 34 children. In all, five Israelis have died, including three civilians killed last week.

AMMUNITION STORES

Obama, whose relations with the hawkish Netanyahu have long been strained, has said he wants a diplomatic solution, rather than a possible Israeli ground operation in the densely populated territory, home to 1.7 million Palestinians.

Israel's military on Tuesday targeted more than 130 sites in Gaza, including ammunition stores and the Gaza headquarters of the National Islamic Bank. Israeli police said more than 150 rockets had been fired from Gaza by the evening.

"No country would tolerate rocket attacks against its cities and against its civilians," Netanyahu said with U.N. Secretary-General Ban Ki-moon, who arrived in Jerusalem from talks in Cairo, at his side. "Israel cannot tolerate such attacks."

Critics have accused Israel of using disproportionate force that has killed civilians. Israel accuses Hamas of putting Gaza's people in harm's way by siting rockets among them.

Media groups have criticized attacks on Gaza media facilities. On Tuesday, three local journalists died in air strikes on their vehicles.

A building housing AFP's bureau was bombed. The French news agency said its staff were unhurt. Israel's military said it had been targeting a Hamas intelligence center in the tower.

Hamas executed six Palestinians accused of spying for Israel, who a security source quoted by Hamas Aqsa radio said had been "caught red-handed" with "filming equipment to take footage of positions". The radio said they had been shot.

Militants on a motorcycle dragged the body of one of the men through the streets.

A delegation of nine Arab ministers, led by the Egyptian foreign minister, visited Gaza in a further signal of heightened Arab solidarity with the Palestinians.

(Additional reporting by Cairo bureau; Writing by Alastair Macdonald)

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