Body of India rape victim arrives home in New Delhi

NEW DELHI (Reuters) - The body of a woman whose gang rape provoked protests and rare national debate about violence against women in India arrived back in New Delhi early on Sunday.

The unidentified 23-year-old medical student died from her injuries on Saturday, prompting promises of action from a government that has struggled to respond to public outrage.

She had suffered brain injuries and massive internal damage in the attack on December 16, and died in hospital in Singapore where she had been taken for treatment.

She and a male friend had been returning home from the cinema, media reports say, when six men on a bus beat them with metal rods and repeatedly raped the woman. The friend survived.

Six suspects were charged with murder after her death.

A Reuters correspondent saw family members who had been with her in Singapore take her body back to their Delhi home in an ambulance with a police escort.

Ruling party leader Sonia Gandhi was seen arriving at the airport when the plane landed and Prime Minister Mannmohan Singh's convoy was also there, the witness said.

The body was later taken to a crematorium and cremated, news channels reported. Media were kept away but a Reuters witness saw the woman's family, New Delhi's chief minister, Sheila Dikshit, and the junior home minister, R P N Singh, coming out of the crematorium.

The outcry over the attack caught the government off-guard. It took a week for Singh to make a statement, infuriating many protesters.

PROTESTS

Issues such as rape, dowry-related deaths and female infanticide rarely enter mainstream political discourse in India.

Analysts say the death of the woman dubbed "Amanat", an Urdu word meaning "treasure", by some Indian media could change that, although it is too early to say whether the protesters calling for government action to better safeguard women can sustain their momentum through to national elections due in 2014.

Protesters have staged peaceful demonstrations in the capital New Delhi and in cities across India in the last few days to keep the pressure on Singh's government to get tougher on crime against women. Last weekend, protesters fought pitched battles with police.

Authorities, worried about the reaction to the news of her death on Saturday, deployed thousands of policemen, closed 10 metro stations and banned vehicles from some main roads in central New Delhi.

Most sex crimes in India go unreported, many offenders go unpunished, and the wheels of justice turn slowly, according to social activists, who say that successive governments have done little to ensure the safety of women.

Commentators and sociologists say the rape has tapped into a deep well of frustration many Indians feel over what they see as weak governance and poor leadership on social issues.

New Delhi has the highest number of sex crimes among India's major cities, with a rape reported on average every 18 hours, according to police figures. Government data show the number of reported rape cases in India rose by nearly 17 percent between 2007 and 2011.

For a link to the poll, click

(Additional reporting by Devidutta Tripathy; Writing by Louise Ireland; Editing by Kevin Liffey)

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Facebook’s SnapChat Intimidator Was Great for SnapChat’s Business

This probably isn’t the outcome Facebook was hoping for. After Facebook created Poke, its very obvious SnapChat intimidator, the rival app saw a big boost in numbers. 

RELATED: Facebook’s SnapChat-Style Sexting App Is Called Poke (Seriously)

The people over at Bloomberg Businessweek looked at the hard numbers and concluded (with charts!) that SnapChat saw a huge uptick in attention after Facebook created Poke. What we initially thought was a clone war was not meant to be. Facebook helped SnapChat rocket to the top of the app charts. SnapChat, to its credit, was ready for the challenge as soon as the gauntlet was laid down by Facebook. SnapChat’s CEO had an Apple-IBM inspired response to Poke’s existence: he told The Verge, “Welcome, Facebook. Seriously.”

RELATED: When SnapChat Videos Don’t Disappear

It was clear from the start that the big boys in blue were big fans of the independent creation: Mark Zuckerberg himself helped code the copycat. But just because the app was touched by the hand of Zuck doesn’t necessarily mean success is guaranteed. Poke’s greatest success so far is helping royally piss off Zuckerberg’s sister. Whether or not Poke, or SnapChat for that matter, is a long-term success remains to be seen. We need to watch the success theater play out before our eyes. 

RELATED: Facebook to Launch Its Own SnapChat as Social-Network Clone Wars Live on

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Matthew & Camila McConaughey Name Their Son Livingston

12/29/2012 at 09:15 PM EST

Camila and Matthew McConaughey

Gary Miller/FilmMagic

Matthew McConaughey has spilled the beans about his new baby!

"Camila gave birth to our third child yesterday morning. Our son, Livingston Alves McConaughey, was born at 7:43 a.m. on 12.28.12," he wrote on his Whosay page Saturday night.

"He greeted the world at 9 lbs., and 21 inches. Bless up and thank you for your well wishes."

Camila, 29, and her actor husband, 43, welcomed their third child in Austin, Texas, Friday, PEOPLE previously confirmed.

The couple – also parents to Vida, almost 3, and Levi, 4 – announced the pregnancy in July, just one month after they wed in Texas.

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Kenya hospital imprisons new mothers with no money

NAIROBI, Kenya (AP) — The director of the Pumwani Maternity Hospital, located in a hardscrabble neighborhood of downtown Nairobi, freely acknowledges what he's accused of: detaining mothers who can't pay their bills. Lazarus Omondi says it's the only way he can keep his medical center running.

Two mothers who live in a mud-wall and tin-roof slum a short walk from the maternity hospital, which is affiliated with the Nairobi City Council, told The Associated Press that Pumwani wouldn't let them leave after delivering their babies. The bills the mothers couldn't afford were $60 and $160. Guards would beat mothers with sticks who tried to leave without paying, one of the women said.

Now, a New York-based group has filed a lawsuit on the women's behalf in hopes of forcing Pumwani to stop the practice, a practice Omondi is candid about.

"We hold you and squeeze you until we get what we can get. We must be self-sufficient," Omondi said in an interview in his hospital office. "The hospital must get money to pay electricity, to pay water. We must pay our doctors and our workers."

"They stay there until they pay. They must pay," he said of the 350 mothers who give birth each week on average. "If you don't pay the hospital will collapse."

The Center for Reproductive Rights, which filed the suit this month in the High Court of Kenya, says detaining women for not paying is illegal. Pumwani is associated with the Nairobi City Council, one reason it might be able to get away with such practices, and the patients are among Nairobi's poorest with hardly anyone to stand up for them.

Maimouna Awuor was an impoverished mother of four when she was to give birth to her fifth in October 2010. Like many who live in Nairobi's slums, Awuor performs odd jobs in the hopes of earning enough money to feed her kids that day. Awuor, who is named in the lawsuit, says she had saved $12 and hoped to go to a lower-cost clinic but was turned away and sent to Pumwani. After giving birth, she couldn't pay the $60 bill, and was held with what she believes was about 60 other women and their infants.

"We were sleeping three to a bed, sometimes four," she said. "They abuse you, they call you names," she said of the hospital staff.

She said saw some women tried to flee but they were beaten by the guards and turned back. While her husband worked at a faraway refugee camp, Awuor's 9-year-old daughter took care of her siblings. A friend helped feed them, she said, while the children stayed in the family's 50-square-foot shack, where rent is $18 a month. She says she was released after 20 days after Nairobi's mayor paid her bill. Politicians in Kenya in general are expected to give out money and get a budget to do so.

A second mother named in the lawsuit, Margaret Anyoso, says she was locked up in Pumwani for six days in 2010 because she could not pay her $160 bill. Her pregnancy was complicated by a punctured bladder and heavy bleeding.

"I did not see my child until the sixth day after the surgery. The hospital staff were keeping her away from me and it was only when I caused a scene that they brought her to me," said Anyoso, a vegetable seller and a single mother with five children who makes $5 on a good day.

Anyoso said she didn't have clothes for her child so she wrapped her in a blood-stained blouse. She was released after relatives paid the bill.

One woman says she was detained for nine months and was released only after going on a hunger strike. The Center for Reproductive Rights says other hospitals also detain non-paying patients.

Judy Okal, the acting Africa director for the Center for Reproductive Rights, said her group filed the lawsuit so all Kenyan women, regardless of socio-economic status, are able to receive health care without fear of imprisonment. The hospital, the attorney general, the City Council of Nairobi and two government ministries are named in the suit.

___

Associated Press reporter Tom Odula contributed to this report.

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Wall Street ends sour week with fifth straight decline

NEW YORK (Reuters) - Stocks fell for a fifth straight day on Friday, dropping 1 percent and marking the S&P 500's longest losing streak in three months as the federal government edged closer to the "fiscal cliff" with no solution in sight.

President Barack Obama and top congressional leaders met at the White House to work on a solution for the draconian debt-reduction measures set to take effect beginning next week. Stocks, which have been influenced by little else than the flood of fiscal cliff headlines from Washington in recent days, extended losses going into the close with the Dow Jones industrial average and the S&P 500 each losing 1 percent, after reports that Obama would not offer a new plan to Republicans. The Dow closed below 13,000 for the first time since December 4.

"I was stunned Obama didn't have another plan, and that's absolutely why we sold off," said Mike Shea, managing partner at Direct Access Partners LLC in New York. "He's going to force the House to come to him with something different. I think that's a surprise. The entire market is disappointed in a lack of leadership in Washington."

In a sign of investor anxiety, the CBOE Volatility Index <.vix>, known as the VIX, jumped 16.69 percent to 22.72, closing at its highest level since June. Wall Street's favorite fear barometer has risen for five straight weeks, surging more than 40 percent over that time.

The Dow Jones industrial average <.dji> dropped 158.20 points, or 1.21 percent, to 12,938.11 at the close. The Standard & Poor's 500 Index <.spx> lost 15.67 points, or 1.11 percent, to 1,402.43. The Nasdaq Composite Index <.ixic> fell 25.59 points, or 0.86 percent, to end at 2,960.31.

For the week, the Dow fell 1.9 percent. The S&P 500 also lost 1.9 percent for the week, marking its worst weekly performance since mid-November. The Nasdaq finished the week down 2 percent. In contrast, the VIX jumped 22 percent for the week.

Pessimism continued after the market closed, with stock futures indicating even steeper losses. S&P 500 futures dropped 26.7 points, or 1.9 percent, eclipsing the decline seen in the regular session.

All 10 S&P 500 sectors fell during Friday's regular trading, with most posting declines of 1 percent, but energy and material shares were among the weakest of the day, with both groups closely tied to the pace of growth.

An S&P energy sector index <.gspe> slid 1.8 percent, with Exxon Mobil down 2 percent at $85.10, and Chevron Corp off 1.9 percent at $106.45. The S&P material sector index <.gspm> fell 1.3 percent, with U.S. Steel Corp down 2.6 percent at $23.03.

Decliners outnumbered advancers by a ratio of slightly more than 2 to 1 on the New York Stock Exchange, while on the Nasdaq, two stocks fell for every one that rose.

"We've been whipsawing around on low volume and rumors that come out on the cliff," said Eric Green, senior portfolio manager at Penn Capital Management in Philadelphia, who helps oversee $7 billion in assets.

With time running short, lawmakers may opt to allow the higher taxes and across-the-board federal spending cuts to go into effect and attempt to pass a retroactive fix soon after the new year. Standard & Poor's said an impasse on the cliff wouldn't affect the sovereign credit rating of the United States.

"We're not as concerned with January 1 as the market seems to be," said Richard Weiss, senior money manager at American Century Investments, in Mountain View, California. "Things will be resolved, just maybe not on a good timetable, and any deal can easily be retroactive."

Trading volume was light throughout the holiday-shortened week, with just 4.46 billion shares changing hands on the New York Stock Exchange, the Nasdaq and NYSE MKT on Friday, below the daily average so far this year of about 6.48 billion shares. On Monday, the U.S. stock market closed early for Christmas Eve, and the market was shut on Tuesday for Christmas. Many senior traders were absent this week for the holidays.

Highlighting Wall Street's sensitivity to developments in Washington, stocks tumbled more than 1 percent on Thursday after Senate Majority Leader Harry Reid warned that a deal was unlikely before the deadline. But late in the day, stocks nearly bounced back when the House said it would hold an unusual Sunday session to work on a fiscal solution.

Positive economic data failed to alter the market's mood.

The National Association of Realtors said contracts to buy previously owned U.S. homes rose in November to their highest level in 2-1/2 years, while a report from the Institute for Supply Management-Chicago showed business activity in the U.S. Midwest expanded in December.

"Economic reports have been very favorable, and once Congress comes to a resolution, the market should resume an upward trend, based on the data," said Weiss, who helps oversee about $125 billion in assets. "All else being equal, we see any further decline as a buying opportunity."

Barnes & Noble Inc rose 4.3 percent to $14.97 after the top U.S. bookstore chain said British publisher Pearson Plc had agreed to make a strategic investment in its Nook Media subsidiary. But Barnes & Noble also said its Nook business will not meet its previous projection for fiscal year 2013.

Shares of magicJack VocalTec Ltd jumped 10.3 percent to $17.95 after the company gave a strong fourth-quarter outlook and named Gerald Vento president and chief executive, effective January 1.

The U.S.-listed shares of Canadian drugmaker Aeterna Zentaris Inc surged 13.8 percent to $2.47 after the company said it had reached an agreement with the U.S. Food and Drug Administration on a special protocol assessment by the FDA for a Phase 3 registration trial in endometrial cancer with AEZS-108 treatment.

(Reporting by Ryan Vlastelica; Editing by Jan Paschal)

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India gang rape victim dies in Singapore hospital

SINGAPORE/NEW DELHI (Reuters) - An Indian woman whose gang rape in New Delhi triggered violent protests died of her injuries on Saturday in a Singapore hospital, bringing a security lockdown in Delhi and recognition from India's prime minister that social change is needed.

The Indian capital braced for a new wave of protests, closing metro stations and banning vehicles from the city centre district where young activists had converged to demand improved women's rights. The news came in the early hours of the morning in India and there were no signs of protests as morning broke.

The 23-year-old medical student, severely beaten, raped and thrown out of a moving bus in New Delhi two weeks ago, had been flown to Singapore in a critical condition by the Indian government on Thursday for specialist treatment.

"We are very sad to report that the patient passed away peacefully at 4:45 a.m. on Dec 29, 2012 (2045 GMT Friday). Her family and officials from the High Commission (embassy) of India were by her side," Mount Elizabeth Hospital Chief Executive Officer Kelvin Loh said in a statement.

Indian Prime Minister Manmohan Singh said in a statement he was deeply saddened by the death and described the emotions associated with her case as "perfectly understandable reactions from a young India and an India that genuinely desires change.

"It would be a true homage to her memory if we are able to channelize these emotions and energies into a constructive course of action."

Delhi's Chief Minister, Sheila Dikshit, expressed revulsion.

"It is a shameful moment for me not just as a chief minister but also as a citizen of this country," she said.

The woman, who has not been identified, and a male friend were returning home from the cinema by bus on the evening of December 16 when, media reports say, six men on the bus beat them with metal rods and repeatedly raped the woman. The reports say a rod was used in the rape, causing internal injuries. Both were thrown from the bus. The male friend survived the attack.

Singh's government has been battling criticism that it was tone-deaf to the outcry that followed the attack and was heavy handed in its response to the protests in the Indian capital.

Most rapes and other sex crimes in India go unreported and offenders are rarely punished, women's rights activists say. But the brutality of the December 16 assault sparked public outrage and calls for better policing and harsher punishment for rapists.

VEHICLES BARRED FROM DELHI CITY CENTRE

T.C.A. Raghavan, the Indian High Commissioner to Singapore, told reporters hours after the woman's death that a chartered aircraft would fly her body back to India on Saturday, along with members of her family. The woman's body had earlier been loaded into a van at the hospital and driven away.

In New Delhi, the Joint Commissioner of Traffic Police, Satyendra Garg, told NDTV news channel that residents and commuters were advised to avoid the city centre.

The case has received blanket coverage on cable television news channels. Some Indian media have called the woman "Amanat", an Urdu word meaning "treasure".

Talking to reporters earlier on Saturday, Raghavan declined to comment on Indian media reports accusing the government of sending her to Singapore to minimize the possible backlash in the event of her death.

Some Indian medical experts had questioned the decision to airlift the woman to Singapore, calling it a risky maneuver given the seriousness of her injuries. They had said she was already receiving the best possible care in India.

But Dr B.D. Athani, medical superintendent of the New Delhi hospital where she had initially been treated, told Indian television the intention was to give the victim the best chance of surviving in what he described as "an extreme case".

"Her condition was very critical from day one. We had managed what best we could do at our end ... she had to be shifted to a centre with much better facilities."

On Friday, the Singapore hospital had said the woman's condition had taken a turn for the worse. It said she had suffered "significant brain injury". She had already undergone three abdominal operations before arriving in Singapore.

The suspects in the rape - five men aged between 20 and 40, and a juvenile - were arrested within hours of the attack and are in custody. Media reports say they are likely to be formally charged with murder next week.

Commentators and sociologists say the rape tapped into a deep well of frustration many Indians feel over what they see as weak governance and poor leadership on social and economic issues.

Many protesters have complained that Singh's government has done little to curb the abuse of women in the country of 1.2 billion. A global poll by the Thomson Reuters Foundation in June found that India was the worst place to be a woman because of high rates of infanticide, child marriage and slavery.

New Delhi has the highest number of sex crimes among India's major cities, with a rape reported on average every 18 hours, according to police figures. Government data show the number of reported rape cases in the country rose by nearly 17 percent between 2007 and 2011.

(Additional reporting by Ross Colvin and Devidutta Tripathy in New Delhi; Saeed Azhar, Edgar Su and Sanjeev Miglani in Singapore; Editing by Michael Roddy, Ron Popeski and Mark Bendeich)

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It’s Easy to Save Videos From Facebook Poke Permanently

Apps like Snapchat and Facebook Poke let users send short messages, photos or videos that automatically self-destruct after a few seconds. However, it’s actually very easy for a recipient to save some of those messages permanently — and without the sender knowing.

Both apps will alert the sender if the recipient takes a screengrab of whatever was sent, of course, but by connecting your phone to a PC or Mac, the messages can be secretly offloaded without the sender knowing — a possibility first reported by BuzzFeed. For an iPhone, all you’ll need is a third-party file manager like iExplorer.

[More from Mashable: Facebook in 2013: More Growing Pains Ahead]

For Poke, only videos can be permanently stored in this manner, and only videos that you haven’t already viewed. But it’s very easy. Once you’ve installed your file manager, connect your iPhone and you should see a list of your apps. Select the Poke folder, then navigate to Library>Caches>FBStore>315_14_>MediaCache. There you should see every Poke video that you haven’t yet watched. (See screencap below.)

[More from Mashable: NYC Releases App to Tell You When the Next Subway Is Coming]

From there, all you need to do is drag and drop the files to any other folder on your computer to copy and store them. After that, you can open the file in Poke, let it self-destruct, and the sender will be none the wiser.

Although permanent storage only works for videos in Poke, performing similar steps for Snapchat will let you save both videos and photos.

While it’s a bit surprising that it’s so easy to save messages that are ostensibly deleted permanently, it may be a stretch to characterize this file caching as a “vulnerability” of the apps, which are generally intended for casual use. Facebook‘s official statement on the matter appears to take this stance:

“Poke is a fun and easy way to communicate with your friends and is not designed to be a secure messaging system. While Pokes disappear after they are read, there are still ways that people can potentially save them. For example, you could take a screenshot of a photo, in which case the sender is notified. People could also take a photo of a photo you sent them, or a video of a video, with another camera. Because of this, people should think about what they are sending and share responsibly.”

What do you think of the potential for someone to save a Facebook Poke or Snapchat message? Let us know in the comments.

Top image courtesy of iStockphoto, JimmyAnderson

Facebook Poke: Startup Screen

Poke, the new iPhone app from Facebook, lets you send short messages, photos and videos to friends that automatically self destruct after a few seconds. If you have the Facebook app on your phone already, logging in is effortless.

Click here to view this gallery.

This story originally published on Mashable here.

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Matthew McConaughey & Wife Camila Welcome Baby No. 3

By Elizabeth Leonard

12/28/2012 at 06:10 PM EST

Camila and Matthew McConaughey

Gary Miller/FilmMagic

It's a very merry holiday week for Matthew McConaughey and his wife Camila.

The couple welcomed their third child together in Austin, Texas, on Friday, sources confirm to PEOPLE.

The pair, who are also parents to Vida, who turns 3 next month, and Levi, 4, announced the pregnancy just one month after their June nuptials in Texas.

Camila, 29, joked that even as she put on pregnancy pounds, her actor husband, 43, was losing weight – dramatically – for The Dallas Buyers Club, in which he plays the real-life Ron Woodruff, who contracted HIV.

"We have gone the complete opposite direction eating wise, but we're navigating it," she said last summer. "But I don't really have cravings yet."

McConaughey's latest movie, Mud, will be released April. 26,

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Kenya hospital imprisons new mothers with no money

NAIROBI, Kenya (AP) — The director of the Pumwani Maternity Hospital, located in a hardscrabble neighborhood of downtown Nairobi, freely acknowledges what he's accused of: detaining mothers who can't pay their bills. Lazarus Omondi says it's the only way he can keep his medical center running.

Two mothers who live in a mud-wall and tin-roof slum a short walk from the maternity hospital, which is affiliated with the Nairobi City Council, told The Associated Press that Pumwani wouldn't let them leave after delivering their babies. The bills the mothers couldn't afford were $60 and $160. Guards would beat mothers with sticks who tried to leave without paying, one of the women said.

Now, a New York-based group has filed a lawsuit on the women's behalf in hopes of forcing Pumwani to stop the practice, a practice Omondi is candid about.

"We hold you and squeeze you until we get what we can get. We must be self-sufficient," Omondi said in an interview in his hospital office. "The hospital must get money to pay electricity, to pay water. We must pay our doctors and our workers."

"They stay there until they pay. They must pay," he said of the 350 mothers who give birth each week on average. "If you don't pay the hospital will collapse."

The Center for Reproductive Rights, which filed the suit this month in the High Court of Kenya, says detaining women for not paying is illegal. Pumwani is associated with the Nairobi City Council, one reason it might be able to get away with such practices, and the patients are among Nairobi's poorest with hardly anyone to stand up for them.

Maimouna Awuor was an impoverished mother of four when she was to give birth to her fifth in October 2010. Like many who live in Nairobi's slums, Awuor performs odd jobs in the hopes of earning enough money to feed her kids that day. Awuor, who is named in the lawsuit, says she had saved $12 and hoped to go to a lower-cost clinic but was turned away and sent to Pumwani. After giving birth, she couldn't pay the $60 bill, and was held with what she believes was about 60 other women and their infants.

"We were sleeping three to a bed, sometimes four," she said. "They abuse you, they call you names," she said of the hospital staff.

She said saw some women tried to flee but they were beaten by the guards and turned back. While her husband worked at a faraway refugee camp, Awuor's 9-year-old daughter took care of her siblings. A friend helped feed them, she said, while the children stayed in the family's 50-square-foot shack, where rent is $18 a month. She says she was released after 20 days after Nairobi's mayor paid her bill. Politicians in Kenya in general are expected to give out money and get a budget to do so.

A second mother named in the lawsuit, Margaret Anyoso, says she was locked up in Pumwani for six days in 2010 because she could not pay her $160 bill. Her pregnancy was complicated by a punctured bladder and heavy bleeding.

"I did not see my child until the sixth day after the surgery. The hospital staff were keeping her away from me and it was only when I caused a scene that they brought her to me," said Anyoso, a vegetable seller and a single mother with five children who makes $5 on a good day.

Anyoso said she didn't have clothes for her child so she wrapped her in a blood-stained blouse. She was released after relatives paid the bill.

One woman says she was detained for nine months and was released only after going on a hunger strike. The Center for Reproductive Rights says other hospitals also detain non-paying patients.

Judy Okal, the acting Africa director for the Center for Reproductive Rights, said her group filed the lawsuit so all Kenyan women, regardless of socio-economic status, are able to receive health care without fear of imprisonment. The hospital, the attorney general, the City Council of Nairobi and two government ministries are named in the suit.

___

Associated Press reporter Tom Odula contributed to this report.

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Consumer sentiment weakens as fiscal crisis looms

WASHINGTON (Reuters) - U.S. consumer confidence fell more than expected in December, hitting a four-month low as a looming fiscal crisis sapped what had been a growing sense of optimism about the economy.

The report heightened concerns that a failure by Washington to avert planned tax hikes and spending cuts could lead households to close their wallets, threatening an economic recovery that has been steady albeit lackluster.

Other data on Thursday highlighted the positive momentum building in the economy, with the number of Americans filing new claims for jobless benefits falling to a nearly 4-1/2 year low and new home sales hitting their highest level since April 2010.

But gauges of business sentiment have weakened recently on worries Washington will go forward with plans to slash the federal deficit by about $600 billion in 2013.

Now consumers also appear apprehensive, a sign worries about the so-called "fiscal cliff" could bite into household spending.

The Conference Board, an industry group, said its index of consumer attitudes fell to 65.1 from 71.5 in November.

A sub-index measuring how consumers feel about their present situation rose to its highest level in more than four years, but a gauge of sentiment about the future plunged to its lowest point in more than a year.

"Consumers are increasingly preoccupied with the potential damage the fiscal cliff will cause to the economy and to their wallets if a deal is not reached soon," economists at RBS in Stamford, Connecticut, wrote in a research note.

Separately, the Labor Department said initial claims for state unemployment benefits dropped 12,000 last week to a seasonally adjusted 350,000, the Labor Department said.

"This recent improvement in the claims data is potentially a favorable signal for the labor market," said Daniel Silver, an economist at JPMorgan in New York.

After spiking in the wake of a mammoth storm that ravaged the East Coast in late October, new claims have dropped to their lowest levels since the early days of the 2007-09 recession. The four-week moving average fell 11,250 last week to 356,750, the lowest since March 2008.

The claims data has no direct relation to the government's monthly employment report, but it suggests the surge in layoffs since the recession has at least run its course.

Still, many economists think hiring may remain sluggish even as the pace of layoffs ease.

Companies in recent months have been adding to their payrolls at a lackluster pace, and analysts expect the employment report due on January 4 will show 143,000 jobs were created in December, down from 146,000 in November.

"A significant improvement in labor market conditions ahead of any resolution to the fiscal cliff is unlikely," said Michael Gapen, an economist at Barclays in New York.

U.S. stocks opened flat but turned lower as the Senate Democratic leader derided Republicans for the lack of progress in budget talks and warned that a fall off the "cliff" appeared inevitable. Investors sought safety by buying U.S. Treasury debt and the dollar, which rose against the euro.

Following a truncated holiday break in Hawaii, U.S. President Barack Obama returned to Washington to restart talks to avoid the brunt of the fiscal cliff's impact, which would likely put the U.S. economy back into recession if not lessened.

HOLIDAY CAVEAT

The signs of progress in the claims data also included a caveat, at least for the latest week.

Obama declared Monday a holiday for federal workers and many state offices followed suit and were unable to provide complete data for last week's jobless claims. Data for 19 states was estimated, although 14 of those states submitted their own estimates, which tend to be fairly accurate.

The holiday season can make it more difficult to adjust the claims data for normal seasonal fluctuations, another reason to be cautious about the report for last week.

Separately, the Commerce Department said new U.S. single-family home sales rose in November to a 377,000-unit annual rate, while the median sales price jumped 14.9 percent from the same month in 2011, the latest signs the U.S. housing recovery is gaining some steam.

In a fourth report, the Chicago Federal Reserve Bank said its index of factory activity in the U.S. Midwest increased in November to 93.7 from a revised 92.2 in October.

(Reporting by Jason Lange; Additional reporting by Richard Leong and Ryan Vlastelica in New York; Editing by Neil Stempleman)

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