2 persons of interest questioned in Hadiya Pendleton's death

Police are questioning two persons of interest in the slaying of 15-year-old Hadiya Pendleton, a day after first lady Michelle Obama attended the funeral for the teen whose death has become a symbol of escalating violence in Chicago, according to police sources.

The two men, 19 and 20, were pulled over around 67th Street and South Chicago Avenue early this morning after detectives heavily canvassed the area of Harsh Park and tracked down witnesses to the shooting Jan. 29, the sources said. No charges have been filed.

Hadiya was fatally shot in the park about a mile north of President Barack Obama's Kenwood home, a little more than a week after the honor student performed with the King College Prep band in Washington during inauguration festivities. Two other teens were wounded.

Mayor Rahm Emanuel personally called Hadiya's parents, Cleopatra Cowley-Pendleton and Nathanial Pendleton, to inform them of the developement, according to a source.

A relative of Hadiya said the development is a "good response" and better information than the family had Saturday. 

Arrests and charges "will bring a small level of closure to the family, although (the shooter) still will be allowed to eat, drink, mingle," said Shatira Wilks, a cousin and family spokesperson. "The thing about that is, Hadiya is no longer to do so."

On how Hadiya’s family is doing, Wilks said, "Everyone keeps asking that. I don’t know if you’ll ever get an answer that we’re feeling good or we’re feeling fine."

Hadiya's death occurred during the deadliest January for Chicago in a decade, and it came on the heels of a homicide total last year that was the highest since 2008.

The first lady's attendance at Hadiya's funeral placed Chicago even further into the spotlight of a national debate over gun violence that has polarized Congress and forced the president to take his gun control initiatives on the road to garner more public support.

Neither the first lady nor elected officials gave remarks during the funeral. Only the friends and relatives who knew Hadiya best were allowed to speak.

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Gunbattle rocks Gao after rebels surprise French, Malians

GAO, Mali (Reuters) - Islamist insurgents launched a surprise raid in the heart of the Malian town of Gao on Sunday, battling French and local troops in a blow to efforts to secure Mali's recaptured north.

Local residents hid in their homes or crouched behind walls as the crackle of gunfire from running street battles resounded through the sandy streets and mud-brick houses of the ancient Niger River town, retaken from Islamist rebels last month by a French-led offensive.

French helicopters clattered overhead and fired on al Qaeda-allied rebels armed with AK-47s and rocket-propelled grenades who had infiltrated the central market area and holed up in a police station, Malian and French officers said.

The fighting inside Gao was certain to raise fears that pockets of determined Islamists who have escaped the lightning four-week-old French intervention in Mali will strike back with guerrilla attacks and suicide bombings.

After driving the bulk of the insurgents from major northern towns such as Timbuktu and Gao, French forces are trying to search out their bases in the remote and rugged Adrar des Ifoghas mountains, far up in the northeast.

But with Mali's weak army unable to secure recaptured zones, and the deployment of a larger African security force slowed by delays and kit shortages, vast areas to the rear of the French forward lines now look vulnerable to guerrilla activity.

"They infiltrated the town via the river. We think there were about 10 of them. They were identified by the population and they went into the police station," said General Bernard Barrera, commander of French ground operations in Mali.

He told reporters in Gao that French helicopters had intervened to help Malian troops pinned down by the rebels, who threw grenades from rooftops.

Malian gendarme Colonel Saliou Maiga told Reuters the insurgents intended to carry out suicide attacks in the town.

SUICIDE BOMBERS

No casualty toll was immediately available. But a Reuters reporter in Gao saw one body crumpled over a motorcycle. Malian soldiers said some of the raiders may have come on motorbikes.

The gunfire in Gao erupted hours after French and Malian forces reinforced a checkpoint on the northern outskirts that had been attacked for the second time in two days by a suicide bomber.

Abdoul Abdoulaye Sidibe, a Malian parliamentarian from Gao, said the rebel infiltrators were from the MUJWA group that had held the town until French forces liberated it late last month.

MUJWA is a splinter faction of al Qaeda's North African wing AQIM which, in loose alliance with the home-grown Malian Islamist group Ansar Dine, held Mali's main northern urban areas for 10 months until the French offensive drove them out.

Late on Saturday, an army checkpoint in Gao's northern outskirts came under attack by a group of Islamist rebels who fired from a road and bridge that lead north through the desert scrub by the Niger River to Bourem, 80 km (50 miles) away.

"Our soldiers came under heavy gunfire from jihadists from the bridge ... At the same time, another one flanked round and jumped over the wall. He was able to set off his suicide belt," Malian Captain Sidiki Diarra told reporters.

The bomber died and one Malian soldier was lightly wounded, he added. In Friday's motorbike suicide bomber attack, a Malian soldier was also injured.

Diarra described Saturday's bomber as a bearded Arab.

Since Gao and the UNESCO World Heritage city of Timbuktu were retaken last month, several Malian soldiers have been killed in landmine explosions on a main road leading north.

French and Malian officers say pockets of rebels are still in the bush and desert between major towns and pose a threat of hit-and-run guerrilla raids and bombings.

"We are in a dangerous zone... we can't be everywhere," a French officer told reporters, asking not to be named.

One local resident reported seeing a group of 10 armed Islamist fighters at Batel, just 10 km (6 miles) from Gao.

OPERATIONS IN NORTHEAST

The French, who have around 4,000 troops in Mali, are now focusing their offensive operations several hundred kilometers (miles) north of Gao in a hunt for the Islamist insurgents.

On Friday, French special forces paratroopers seized the airstrip and town of Tessalit, near the Algerian border.

From here, the French, aided by around 1,000 Chadian troops in the northeast Kidal region, are expected to conduct combat patrols into the Adrar des Ifoghas mountains.

The remaining Islamists are believed to have hideouts and supply depots in a rugged, sun-blasted range of rocky gullies and caves, and are also thought to be holding at least seven French hostages previously seized in the Sahel.

The U.S. and European governments back the French-led operation as a defense against Islamist jihadists threatening wider attacks, but rule out sending their own combat troops.

To accompany the military offensive, France and its allies are urging Mali authorities to open a national reconciliation dialogue that addresses the pro-autonomy grievances of northern communities like the Tuaregs, and to hold democratic elections.

Interim President Dioncounda Traore, appointed after a military coup last year that plunged the West African state into chaos and led to the Islamist occupation of the north, has said he intends to hold elections by July 31.

But he faces splits within the divided Malian army, where rival units are still at loggerheads.

(Additional reporting by Tiemoko Diallo and Adama Diarra in Bamako; Writing by Joe Bavier and Pascal Fletcher; Editing by Kevin Liffey)

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Stocks end higher for sixth straight week, tech leads

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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Wisconsin beats No. 3 Michigan 65-62 in OT

MADISON, Wis. (AP) — When Ben Brust tied the game at the end of regulation with a shot just from just inside midcourt, his teammate Mike Bruesewitz looked over at Wisconsin coach Bo Ryan and saw something unusual.

His coach had both his arms in the air.

"You know when he shows some emotion, you've done something pretty special," Bruesewitz said.

Brust hit a tie-breaking 3-pointer with less than 40 seconds left in overtime as Wisconsin beat No. 3 Michigan 65-62 on Saturday.

"It was awesome, something I'll remember forever, and I'm sure a lot of people will," Brust said of the game, which ended with students storming the court and Bruesewitz taking the public address announcer's microphone to thank the crowd as students celebrated around him.

The Wolverines became the third top three team to lose this week as No. 1 Indiana lost to Illinois and No. 2 Florida was beaten by Arkansas. This should be the sixth straight week with a different No. 1 in The Associated Press' Top 25.

Brust's shot at the end of regulation was a dramatic turn of events for Wisconsin (17-7, 8-3 Big Ten) and a soul crusher for Michigan (21-3, 8-3).

Just moments earlier, Tim Hardaway Jr. hit a contested 3-pointer to put the Wolverines up 65-52 with less than 3 seconds left in regulation.

Following a timeout, Bruesewitz passed up his first option in the inbounds play and hit Brust in stride. The guard took one dribble across halfcourt and launched the shot, which hit nothing but net.

Ryan said the play was drawn up to see how Michigan defended the first cutter, Brust read the defense and reacted.

"The best thing was Mike's pass on the dime on the run, didn't have to reach back for it, able to catch it all in one motion," Ryan said.

Michigan still had fouls to give before the shot, and coach John Beilein said the order coming out of the timeout was to foul. He also put Caris LeVert on Brust to bolster the defense.

"We were definitely fouling, wanted to keep everyone in front of us and (Brust) turned the corner on (LeVert) just enough that he couldn't foul him," Beilein said. "I thought we had them once they couldn't get their initial guy.

"With Caris' quickness, we thought he could get there, but he didn't."

For all the fireworks in the final 3 seconds, the teams only managed seven points in overtime, including Brust's winning 3-pointer.

Following Brust's shot, Hardaway couldn't connect on his drive to the hoop on the next Michigan possession, and Glenn Robinson III fouled Jared Berggren on the rebound.

The Wolverines went to a full-court press with two more fouls to give. But the Badgers broke the press, and Michigan had to foul twice more to finally put Ryan Evans on the free throw line.

Evans, who shoots less than 43 percent from the line, missed the front end of a 1-and-1, and Burke couldn't connect in a rushed final possession for the Wolverines.

It was another grinding win for the Badgers keyed by their defense. Michigan came in as one of the top scoring teams in the country at almost 78 points per game. But Wisconsin held Michigan to less than 40 percent shooting from the field, including 5 of 18 from beyond the 3-point line.

Michigan was 1 for 7 from the field in overtime, and the offensive futility was highlighted by one sequence in which Mitch McGary stole the ball outside the 3-point line and drove the other way only to miss the layup with Berggren defending the rim.

Beilein said the Wolverines missed out on 14 points thanks to missed layups.

"I'm not talking about when they're really contesting," Beilein said. "I'm talking about we had the ball, the basket and us, and it didn't go in."

Brust scored 14 points for the Badgers, while Berggren added 13 and eight rebounds. Sam Dekker scored 12 points, while Evans finished with 11 points and nine rebounds.

Burke scored 19 points to lead Michigan, but needed 21 shots to do it. Hardaway added 18, and McGary had 12 points and eight rebounds.

It was the second straight game for both teams to go past regulation after the Badgers beat Iowa 74-70 in double overtime on Wednesday and Michigan downed Ohio State 76-74 in overtime on Tuesday.

Several Wisconsin players said consecutive overtime games exemplified their will to win even as critics contend they're not talented enough, not fast enough and, as Bruesewitz said he's seen on Twitter, not good-looking enough.

"We have a group of guys in that locker room that believe and is going to fight until the end until you tell us we can't play any more basketball," Berggren said. "We just find a way to get it done."

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How Obama can end Congo conflict

Conflict in Congo

Conflict in Congo

Conflict in Congo

Conflict in Congo

Conflict in Congo

STORY HIGHLIGHTS

• President Obama can help end the Congo conflict for good, says Vava Tampa


• Obama has asked Rwanda to end all support to armed groups in the Congo


• FDLR militia gang is a threat to stability and must leave Congo


• Obama must push for change in Congolese government, argues Tampa

Editor's note: Vava Tampa is the founder of Save the Congo, a London-based campaign to tackle "the impunity, insecurity, institutional failure and the international trade of minerals funding the wars in Democratic Republic of the Congo." Follow Vava Tampa on twitter: @VavaTampa

(CNN) -- Now that President Obama has taken a public stand on the warlords and militia gangs tyrannizing DR Congo, there is a sense that the next chapter in the human tragedy that has been raging there over the past decade and half is about to be written -- or so we can hope.

In the DRC -- Africa's largest sub-Saharan country -- invasions, proxy wars and humanitarian crises have senselessly shut down millions of lives, displaced millions more from their homes and left countless women and young girls brutally raped with the world barely raising an eyebrow.

The latest murderous attempt by the M23 militia gang to besiege Goma, the strategic regional capital of Congo's eastern province of North Kivu, seems to have backfired.

Vava Tampa

The United Nations says Rwanda has helped to create and militarily supported M23. Although Rwandan President Paul Kagame denies backing M23, the accusation has taken off some of the international gloss he had long enjoyed in the West, and precipitated cuts and suspension of aid money that goes directly to the Kagame regime by the Netherlands, Sweden, Germany, Britain and the European Union.

The United States, which gives no money directly to the Rwandan government, suspended its military aid. In a baffling expression of a refinement of the U.S. position, President Obama made a rare telephone call to Kagame to emphasize "the importance of permanently ending all support to armed groups in the DRC." That set a firm red line on the situation in that region, the first one by President Obama since becoming president in 2008.

Watch video: Kagame on Congo

This was certainly right and good. Kagame is no fool; the diplomatic but emphatic content of that telephone call, monitored by White House's National Security staff and published thereafter for public consumption, speaks volumes. He clearly understood the implicit threat. But it was not good enough.

Left unsaid is that withholding aid money that goes directly to the Kagame regime has not changed many realities on the ground -- a painful reminder of the limits of what previous half-hearted, ambivalent international attempts to halt the crisis in that country had achieved.

However, the situation is not hopeless. President Obama can help to halt the wars engulfing the Congo. It is both economically and politically affordable.

Here is my suggestion -- a three-point road map, if you like, for President Obama, should he choose to put the weight of the United States squarely on the side of the Congolese and engage much more robustly to help end the world's bloodiest war and human tragedy.

Read more: Why the world is ignoring Congo war

1. Changes in Kinshasa

If we are to be blunt with ourselves, Congo's major problem today -- the chief reason that country remains on its knees -- is its president Joseph Kabila. Paul Kagame is just a symptom, at least in theory.

The crisis of leadership in the capital Kinshasa, the disastrous blend of lack of political legitimacy and moral authority, mixed with poor governance and vision deficiency, then compounded with dilapidated state institutions, has become the common denominator to the ills and wrongs that continues to overwhelm the Congo.

In other words, peace will never be secured in Congo, if the moribund status quo is still strutting around Kinshasa.

Obama's minimum objective in regard to ending the wars and human tragedy engulfing the Congo should be to push for changes in Kinshasa. He must make this one of the "10 Commandments" of the Obama Doctrine.

Circumstances demand it to re-energize Congo's chance of success and to enable the renaissance of a "New Africa." And given the effects of Congo's mounting death toll and the speed at which HIV/AIDS is spreading because of the use of rape as a weapon of war, the sooner the better.

2. Keep Kagame in the naughty corner

The wars and human tragedy engulfing the Congo have many fathers and many layers. Rwanda, and to some extent Uganda -- run by Africa's two dearest autocratic but staunchly pro-American regimes -- are, as they have been many times in the past, despite their denials, continuing to provide support to warlords and militia gangs terrorizing the Congolese people.

This is not an apocryphal claim, it's an open secret in Kinshasa, Kampala and Kigali as much as it is in Washington or White Hall, and as real as Charles Taylor's role in Sierra Leone or Iran's support to Hezbollah.

If President Obama is remotely serious about saving lives in Congo, then fracturing Rwanda's ability to directly or indirectly harbor warlords ... is critical.
Vava Tampa, Save the Congo

Indeed, reporters across Congo and across the region would testify to this. Kigali has been, one can safely argue, the sole shareholder in the M23 militia gang -- and its elder sisters CNDP and RCD-Goma.

It cannot wash its hands in Pontius Pilate fashion of either the ICC-wanted M23 warlord Bosco Ntaganda, also known as The Terminator, or Laurent Nkunda, who is wanted by the Congolese government for war crimes and is under house arrest in Kigali.

Read more: Prosecutor seeks new Congo war crimes warrants

If President Obama is remotely serious about saving lives in Congo, then fracturing Rwanda's ability to directly or indirectly harbor warlords, support militia gangs, militarize or ethnicize the wars in Congo for control of Congo's easily appropriable but highly valuable natural resources is critical, however politically disgruntling it may be to some in the State Department.

It would reduce the scale, scope and intensity of the killing, raping and uprooting of the Congolese, it would crush Kinshasa's ability to use external support to warlords and militia gangs as an alibi for a lack of progress and, above all, decrease the growing unease of the Congolese towards Rwanda over the crimes of FDLR and the role played by their government in Congo.

3. FDLR

The continued existence in Congo of FDLR, a Rwandan militia gang made up largely of Hutus -- whose leadership took part in the 1994 genocide of Tutsi -- remains one of the most persistent and serious threats to stability in Congo and the region.

Addressing this crisis is of significant importance from both a political and humanitarian viewpoint.

Though there are no definitive statistics on the exact numbers of FDLR fighters, the good news is that experts tell us that the vast majority of its rank and file are in their 20s and early 30s, which means they were too young to have taken part in the genocide in 1994.

The United States, together with the U.N., the EU and African Union, should appoint a special envoy for the African Great Lakes region to midwife a conducive political arrangement in Kigali that could see them returning home -- and see their leaders and fundraisers in Europe arrested.

The opinions expressed in this commentary are solely those of Vava Tampa.

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Northeast blizzard: 4 dead, hundreds of thousands left without power

New York/Boston—

A record-breaking blizzard packing hurricane-force winds hammered the northeastern United States on Saturday, cutting power to 700,000 homes and businesses, shutting down travel and leaving at least four people dead.

The mammoth storm that stretched from the Great Lakes to the Atlantic dumped more than 3 feet of snow across the Northeast, the National Weather Service said. Coastal blizzard and flood warnings were in effect as the storm moved slowly eastward out to sea.

Stratford, Connecticut, Mayor John Harkins said he had never seen such a heavy snowfall, with rates reaching 6 inches an hour.

"Even the plows are getting stuck," Harkins told local WTNH television.

The storm centered its fury on Connecticut, Rhode Island and Massachusetts, with the most snowfall, 38 inches, in Milford, Connecticut.

Authorities ordered non-essential vehicles to stay off roads to allow snow plow crews to clear them. The ban left normally busy arteries such as Interstate 93 in Massachusetts nearly deserted.

About 2,200 flights were canceled on Saturday, according to FlightAware, which tracks airline delays. Boston's Logan International Airport and Bradley International Airport in Windsor Locks, Connecticut, were shut down.

Massachusetts Governor Deval Patrick told a Boston radio station he would re-evaluate a vehicle travel ban he introduced on Friday, but would lift it only "when it's safe to do so."

The storm dumped 29.3 inches of snow on Portland, Maine, breaking a 1979 record. Winds gusted to 83 miles an hour at Cuttyhunk, New York, and brought down trees across the region.

The storm contributed to three deaths in Connecticut, Governor Dannel Malloy told a news conference.

An 80-year-old woman was killed by a hit-and-run driver while clearing her driveway, and a 40-year-old man collapsed while shoveling snow. One man, 73, slipped outside his home and was found dead on Saturday, Malloy said.

In Poughkeepsie, New York, a man in his 70s was struck and killed on a snowy roadway, local media reported.

A 30-year-old motorist in Auburn, New Hampshire, also died when his car went off the road, but the man's health might have been a factor in the accident, state authorities said.

Police in New York's Suffolk County, some using snowmobiles, rescued hundreds of motorists stuck overnight on the Long Island Expressway, said police spokesman Rich Glanzer. Some spent the night in their cars.

POWER LINES DOWN

Utility companies reported about 700,000 customers without electricity across nine states as the wet, heavy snow brought down tree branches and power lines.

The Pilgrim Nuclear Power Plant in Plymouth, Massachusetts, lost power and shut down automatically late on Friday, but there was no threat to the public, the Nuclear Regulatory Commission said.

A storm surge combined with a high tide led to isolated coastal flooding. U.S. Route 1A was closed in New Hampshire because of debris and rocks that washed ashore, police said.

As the storm tapered off, streets in Cambridge, Massachusetts, were largely quiet except for snowblowers and shoveling. Kevin Tierney, 41, struggled with a snowblower to carve out a parking space in more than 2 feet of snow.

"I had this all planned out, and I don't know who said it, but everybody goes into a boxing match with a plan until they get punched in the mouth," said Tierney, an attorney.

Massachusetts, Rhode Island, Connecticut, New York and Maine declared a state of emergency before the storm. The U.S. Postal Service suspended mail delivery in the six New England states.

Although New York was hit by a foot of snow, Fashion Week went on unfazed as crowds arrived to watch the morning's shows by Ruffian and LaCoste.

Andrea Daney, a digital marketing senior manager for LaCoste, said she was trying to be discreet as she changed from snow boots to high-heeled crushed blue velvet ankle boots.

"I'm calling it the shoe storm of the century," she said. "You have to make adjustments to your outfit."

The snow delighted New England's ski industry. Greg Kwasnick, a spokesman for Loon Mountain in Lincoln, New Hampshire, said business was slightly slower than normal on Saturday but likely would pick up in coming days.

"Snow is what it's all about," he said.

(Additional reporting by Scott Malone in Boston, Kevin Gray in Miami, Ellen Wulfhorst in New York, Ian Simpson in Washington, Jason McLure in Maine, Dan Burns in Connecticut, Dan Lovering in Cambridge; Editing by Vicki Allen and Gunna Dickson)

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Israel's Lieberman says Palestinian peace accord impossible

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

(Writing by Dan Williams; Editing by Stephen Powell)

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Optimism about economy sends stocks to multiyear highs

NEW YORK (Reuters) - The Nasdaq composite stock index closed at a 12-year high and the S&P 500 index at a five-year high after stronger U.S. and international trade data improved the outlook for economic growth.

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

Data showed Chinese exports grew more than expected, while another report showed the U.S. trade deficit had narrowed in December, indicating the U.S. economy strengthened in the fourth quarter.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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AP Source: Hernandez on verge of new deal with M's

SEATTLE (AP) — Felix Hernandez and the Seattle Mariners are working on a $175 million, seven-year contract that would make him the highest-paid pitcher in baseball, according to a person with knowledge of the deal's details.

The person spoke to The Associated Press Thursday on condition of anonymity because the agreement has not been completed. USA Today first reported the deal.

Seattle would add $134.5 million of guaranteed money over five years to the contract of the 2010 AL Cy Young Award winner, whose current agreement calls for him to receive $40.5 million over the next two seasons.

Hernandez's total dollars would top CC Sabathia's original $161 million, seven-year contract with the New York Yankees and his $25 million average would surpass Zack Greinke's $24.5 million under his new contract with the Los Angeles Dodgers and tie him for the second-highest in baseball with Josh Hamilton and Ryan Howard behind Alex Rodriguez ($27.5 million). Hernandez's new money would average $26.9 million over five years.

Hernandez agreed to a $78 million, five-year contract in January 2010 and has earned an additional $2.5 million in escalators and $300,000 in bonuses. He is due $20 million this year and $20.5 million in 2014, which would be superseded by the new deal.

Seattle general manager Jack Zduriencik said he could not comment when reached on Thursday, and Hernandez's representatives didn't immediately return messages.

If the deal is finalized, it would leave Detroit's Justin Verlander and the Dodgers' Clayton Kershaw as the most attractive pitchers eligible for free agency after the 2014 season. Tampa Bay's David Price is eligible after the 2015 season.

Hernandez has become the face of Seattle's struggling franchise, transforming from a curly haired 19-year-old who wore his hat crooked to one of the most dominant and exciting pitchers in baseball. Known as "King Felix," he became the first Seattle pitcher to throw a perfect game in a 1-0 win over Tampa Bay last August.

His fiery enthusiasm on the mound and his willingness to first sign a long-term deal in 2010 have endeared him to fans in the Pacific Northwest who have gone more than a decade without seeing postseason baseball.

Hernandez, who will turn 27 on April 8, is 98-76 with a 3.22 ERA in eight seasons with the Mariners. He won a career-high 19 games in 2009 when he finished second in the Cy Young voting then won the award a year later when he went just 13-12 but had a 2.27 ERA and 232 strikeouts.

Hernandez appeared to be making another Cy Young push last year before going 0-4 in his last six starts, which left him at 13-9 with 223 strikeouts.

His career record would be even better if he didn't play with one of baseball's worst offenses. Seattle had the lowest batting average in the major leagues in each of the last three seasons. Hernandez has taken 10 losses during that span when he's given up two earned runs or less.

For his career, Hernandez has allowed two earned runs or less in 141 of 238 starts, but the team is only 99-42 in those games due to the offensive problems.

Locking up Hernandez long-term won't solve all of the problems that have left Seattle looking up at Texas, Oakland and the Los Angeles Angles in the AL West for most of the last 10 years. The Mariners have tried to address some of those issues this offseason by trading for Kendrys Morales and Michael Morse to provide more punch to go along with young prospects Dustin Ackley, Kyle Seager and Jesus Montero, who have all shown flashes early in their careers.

But should the deal be finalized, the Mariners at least have the security of knowing who'll be at the top of their rotation for most of this decade.

___

AP Sports Writer Ronald Blum contributed to this report.

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Gun violence plans: What's in the works

STORY HIGHLIGHTS

• Connecticut school massacre prompts a number of proposals in Washington aimed at curbing gun violence


• They include a ban on assault weapons that insiders say has little chance of getting through Congress


• Some bipartisan support for proposals to expand background checks around gun purchases

Washington (CNN) -- December's school massacre in Newtown, Connecticut, has prompted congressional lawmakers and the White House to offer a number of proposals aimed at curbing gun violence.

Here are some of the measures garnering the most attention:

The White House plan

President Barack Obama signed 23 executive actions, which don't require congressional approval, to strengthen existing gun laws and take related steps on mental health and school safety.

He has also called on Congress to reinstate the Clinton-era assault weapons ban that expired in 2004, to restrict ammunition magazines to no more than 10 rounds, and to expand background checks to anyone buying a gun, whether at a store or in a private sale at an auction or convention.

Assault weapons ban revisited

A proposal by Sen. Diane Feinstein, D-California, would not ban ownership of assault weapons outright, but would prohibit new ones from being manufactured, sold or imported. It would also outlaw ammunition magazines that hold more than 10 rounds.

She said the goal is to "dry up the supply of these weapons over time." The measure, along with a companion bill in the House, is opposed by the nation's powerful gun lobby, led by the National Rifle Association.

Cracking down on straw purchases

Vermont Democrat Sen. Patrick Leahy, chairman of the Senate Judiciary Committee, has called for stronger background checks and a crackdown on so-called straw purchases, in which people who can pass background checks buy weapons for others. Leahy has proposed a measure to increase penalties for straw purchasers.

Curbing gun trafficking

A new House bipartisan gun control bill seeks to make gun trafficking a federal crime. It has some bipartisan support and mirrors a measure proposed in the Senate.

House Democratic efforts

A group of House Democrats, who were part of the chamber's Democratic Gun Violence Prevention Task Force, unveiled 15 proposals to address gun violence. The measures largely echoed those previously backed by the White House.

The package is similar to other Democratic measures that would address background checks, ban high capacity magazines, and crack down on gun trafficking.

House Majority Leader Eric Cantor, R-Viginia, told CNN that he supports beefed up background checks for gun sales.

Closing gun show loophole

A group of four senators working behind the scenes on a bipartisan bill to expand background checks on gun sales is making significant progress, according to sources in both parties familiar with their work.

The group includes Sen. Tom Coburn, R-Oklahoma, who has an A rating with the National Rifle Association, and Sen. Joe Manchin, D-West Virginia, a long time advocate of gun rights.

The legislation would effectively require background checks on private gun purchases made with non-licensed gun dealers, according to sources in both parties. That would include closing the so-called gun show loophole.

Political play

House Speaker John Boehner has said he has no plans to bring any measure up for a vote until the Senate acts first.

Republicans oppose any assault weapons ban and rural-state Democrats facing tough re-election fights are unlikely to support it as well, meaning that proposal has little chance of passing Congress.

There is some bipartisan support for expanded background checks, especially to keep guns out of the hands of people with mental illness. A number of lawmakers may also support limiting the size of ammunition magazines.

Some lawmakers have said that various gun proposals may be addressed in separate bills, rather than a comprehensive package, which could more easily be targeted by opponents.

The top Democrat in Congress, Senate Majority Leader Harry Reid of Nevada, has a good rating from gun rights groups and has said he would work to ensure that a variety of proposals are brought to the floor for consideration.

He opposed the 1994 assault weapons ban and has indicated support for expanding background checks but refuses to endorse a new weapons prohibition.

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