Troubled smartphone pioneer RIM prepares to raise the curtain on BlackBerry 10

NEW YORK, N.Y. – After several technical blunders, two unexpected delays and one major shakeup in its leadership, BlackBerry-maker Research In Motion is about to raise the curtain for its new smartphone devices in hopes that consumers share the excitement.

The unveiling of the phones and operating system on Wednesday marks the start of an advertising blitz that will stretch to social media, the Super Bowl and beyond as RIM tries to regain the cool factor that was once firmly in its grasp.

If all goes according to plan, the event will also mark the end of a troublesome 12 months that has seen RIM try to stay afloat while its future was constantly in question by outsiders, and its stock price tumbled to the lowest level in about a decade.

While the first hurdles to overcome on Wednesday are the opinions of tech analysts and investor reaction, the true measure of success — actual sales of the phones — is still weeks away.

As a crowd of thousands gathers Wednesday at Pier 36, a massive entertainment venue on the shores of Manhattan, chief executive Thorsten Heins will step onto the stage holding the BlackBerry that has been at once considered the company’s last hope, but also its biggest hurdle.

Just over a year ago, when Heins took over the top spot at RIM, the smartphone maker was in a state of flux as its marketshare tumbled in North America against growing competition from Apple’s iPhone and various devices on the Android operating system.

Analysts had widely blamed the lack of leadership from former co-CEOs Jim Balsillie and Mike Lazaridis as the reasons that RIM failed to innovate its way out of trouble, but they also said that Heins had much to prove in hardly any time.

The company was in a bubble, insisting that it hadn’t lost its footing in the smartphone industry, even though from the outside their downfall was indisputable.

But as the dust settled from Balsillie’s exit in March 2012, Heins began to face the realities of RIM’s problems and launched a major overhaul of its middle management and deep cuts to its operations.

While Heins preferred to call it removing a “little fat on the hips,” the changes at RIM were a far more strategic and complex surgery.

The company closed some of its manufacturing facilities and announced plans to lay off about 5,000 workers, as it aimed to save $ 1 billion across RIM’s operations by February 2013. Heins reached that savings goal, and he did it three months ahead of schedule.

“He is probably one of the least dogmatic people at RIM,” said Carl Howe, vice-president of consumer research at Yankee Group.

“I think he learned from his predecessors.”

Despite all of the changes, Heins was still up against the fact that development of the BlackBerry 10 operating system was woefully behind schedule. Already delayed from a launch in 2011, the CEO was forced in June to further push the debut into 2013, missing crucial sales periods like the back-to-school and Christmas holiday shopping seasons.

While analysts hated the idea of another delay, it also bought the company some extra time to tweak the software to capitalize on the weaknesses of competitors’ smartphones.

One of those features is the BlackBerry Balance technology, which allows one phone to operate as both a business and personal device entirely separate from each other. Another one lets users seamlessly shift between the phone’s applications like they’re flipping between pages on a desk.

The BlackBerry Messenger chat program will also get an update that includes video chat and screen sharing options.

RIM’s executives also began an aggressive campaign last year to win the developer community. Under its previous leadership, the BlackBerry had practically ignored the growing popularity of smartphone applications for services like Netflix, Skype and Instagram.

A sea of change was coming under its new leaders, and Heins had managed to at least steady a company that was swaying on its pillars by coming up with unconventional ideas.

As the BlackBerry lost steam in North America and Europe, he turned to developing countries like Indonesia and Nigeria to keep revenues flowing in the near term. In those places, consumers were hungry for low-cost smartphones and the BlackBerry was still considered a status symbol.

The decision helped RIM keep its subscriber base steady, and maintain its $ 2-billion cash reserve, which was set aside for emergencies. It will use some of that money to promote the new phones.

“Up until now I think everything (Heins) laid out in terms of his plan … he’s shown that he’s executed on it,” said Richard Tse, an analyst at Cormark Securities Inc.

“In terms of what they’ve done on the development side, in terms of streamlining the operations and preserving the cash, I think he’s done a very good job to date.”

Investors aren’t satisfied with all of his decisions, however, especially when Heins unveiled a rough plan in December that will likely eat into the lucrative service fees charged to BlackBerry subscribers.

Heins told analysts on its most recent earnings conference call that RIM plans to launch an a la carte menu of services where both enterprise customers and casual smartphone users can pick their packages. The change would likely mean reduced revenues in one of the most lucrative areas of its business.

Even on the dawn of the new BlackBerry unveiling, there are still questions about whether RIM will exist in its current form this time next year. Some analysts have said the company will eventually be forced to sell off at least its hardware division, if not more.

“They’re in such a difficult position that I can’t think of a management change that would help them get out of it,” Tim Long of BMO Capital Markets.

“Clearly there are people out there that think the BlackBerry 10 is going to be something that gets them back on the map. We don’t think so.”

Long said his checks within the mobile phone industry have shown that carriers aren’t particularly interested in RIM’s touchscreen smartphone, but they’re more anxious for the keypad version, or QWERTY phone, due sometime after the initial launch.

“We think that’s an issue,” he said.

If the stock price is any sign, RIM’s investors are at least more confident this month then they’ve been in a long time. As of Monday’s closing price, RIM’s shares have risen 167 per cent from its lowest level in about a decade, reached in September, on the Toronto Stock Exchange.

Several analysts have boosted their target prices for the company’s stock in the past two weeks.

Whatever happens after the new BlackBerrys are unveiled, it’s certain that RIM isn’t in the clear yet.

“Product transitions are always pretty ugly,” said Howe.

“The good news is if you can get yourself through to the other side … you have an opportunity to disrupt the market yourself.”

Wireless News Headlines – Yahoo! News

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Anne Hathaway Says She 'Met A Lot of Bad Ones' Before Meeting Her Husband

Caught in the Act

01/29/2013 at 06:00 AM EST

Adam Shulman and Anne Hathaway

Christopher Polk/WireImage

Following the Screen Actors Guild Awards on Sunday, Anne Hathaway was feeling the love at an after party at the Four Seasons in Beverly Hills.

Hathaway – who won an Actor for her role in Les Misérables – was overheard saying, "I'm in a celebratory mood."

With a drink in her hand, Hathaway told friends that her engagement ring from husband Adam Shulman is her "prized possession" and that her wedding band "isn't bad either," an onlooker tells PEOPLE.

Hathaway – who, according to a source "was playing matchmaker all night" – was later overheard telling her friends that she "met a lot of bad ones" before meeting Shulman.

– Patrick Gomez

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CDC: Flu seems to level off except in the West

New government figures show that flu cases seem to be leveling off nationwide. Flu activity is declining in most regions although still rising in the West.

The Centers for Disease Control and Prevention says hospitalizations and deaths spiked again last week, especially among the elderly. The CDC says quick treatment with antiviral medicines is important, in particular for the very young or old. The season's first flu case resistant to treatment with Tamiflu was reported Friday.

Eight more children have died from the flu, bringing this season's total pediatric deaths to 37. About 100 children die in an average flu season.

There is still vaccine available although it may be hard to find. The CDC has a website that can help.

___

CDC: http://www.cdc.gov/flu/

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Futures flat, Caterpillar on tap to report

NEW YORK (Reuters) - Stock index futures were little changed on Monday, with investors reluctant to make big bets following a rally that took the S&P 500 above 1,500 for the first time in more than five years.

A strong start to the earnings season has boosted equities, with major averages rising for four straight weeks. The S&P has gained for eight straight days, its longest winning streak in eight years.

Over the past four weeks, the S&P has jumped 7.2 percent, suggesting markets may be vulnerable to a pullback if news disappoints.

Earnings will continue to be a primary focus, with Caterpillar Inc likely to be a market mover when it reports its latest quarterly financial results later on Monday. The heavy machinery maker could provide a clue into the state of the global industrial sector, which is closely tied to the pace of economic growth.

Yahoo Inc reports after the closing bell, and could face heightened expectations following strong results at Google Inc last week.

Thomson Reuters data through Friday showed that of the 147 S&P 500 companies that have reported earnings so far, 68 percent exceeded expectations. Since 1994, 62 percent of companies have topped expectations, while the average over the past four quarters stands at 65 percent.

S&P 500 futures rose 0.8 point and but were slightly below above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 7 points and Nasdaq 100 futures rose 0.2 point.

The S&P 500 closed at its highest since December 10, 2007, and the Dow ended at its highest since October 31, 2007.

Investors will also be looking to durable goods orders and pending home sales, both for December. Durable goods are due at 8:30 a.m. (1330 GMT) and are seen rising 1.8 percent. Pending home sales are seen rising 0.3 percent.

Last week, sales of new U.S. single-family homes fell in December but rose in 2012 to the highest level since 2009, a sign the U.S. housing market turned a corner last year.

Bargain hunters may look to Apple Inc for a bargain the first session after the tech giant lost its coveted title as the largest U.S. company by market capitalization to Exxon Mobil Corp . On Friday, Apple's market cap fell to $413 billion, down roughly $250 billion from its September peak. Apple's fall is about equal to the entire value of Google Inc .

U.S. stocks rose on Friday, lifted by strong results from such companies as Procter & Gamble . The rise put the S&P 500 about 4.1 percent away from its all-time closing high of 1,565.15 on October 9, 2007.

(Editing by W Simon)

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Egypt's Mursi declares emergency after clashes kill dozens

CAIRO (Reuters) - Egyptian President Mohamed Mursi declared a month-long state of emergency in three cities on the Suez Canal, where dozens of people have been killed in protests that have swept the nation and deepened a political crisis facing the Islamist leader.

Hundreds of demonstrators in Port Said, Suez and Ismailia turned out against the decision within moments of Mursi's announcement late on Sunday, which came after the death toll from protests and violence that erupted last week hit 49.

Mursi also called for a national dialogue with his rivals for later on Monday, but the early response from members of the main opposition coalition suggested they saw little point, saying the president only seemed to listen to his allies.

Most deaths have been in Port Said, where 40 were killed in just two days. Riots were sparked on Saturday when a court sentenced to death several people from the city on charges related to deadly rioting at a soccer match last year. Mourners at Sunday's funerals in the port, where guns are common, directed their anger at Mursi.

Violence in Egypt's cities has extended to a fifth day. Police fired volleys of teargas at dozens of youths hurling stones on Monday near Cairo's Tahrir Square, where opponents have camped for weeks to protest against Mursi, who they say betrayed the revolution that ousted Hosni Mubarak two years ago.

"We want to bring down the regime and end the state that is run by the Muslim Brotherhood," said Ibrahim Eissa, a 26-year-old cook, protecting his face from teargas wafting towards him from police lines near Tahrir, the cauldron of the 2011 revolt.

Propelled to power in a June election by the Brotherhood, Mursi's presidency has lurched through a series of political crises and violent demonstrations, compounding his task of shoring up a teetering economy and preparing for a parliamentary election to cement the new democracy in a few months.

"The protection of the nation is the responsibility of everyone. We will confront any threat to its security with force and firmness within the remit of the law," Mursi said, offering condolences to families of victims in the canal zone cities.

"WASTE OF TIME"

Appealing to his opponents, the president called for a national dialogue on Monday at 6 p.m. (1600 GMT), inviting a range of Islamist allies as well as liberal, leftist and other opposition groups and individuals to discuss the crisis.

The main opposition National Salvation Front coalition gathered in Cairo to discuss a response, but several members have already suggested they do not expect much from the meeting, raising the prospect of poor attendance.

"Unless the president takes responsibility for the bloody events and pledges to form a government of national salvation and a balanced committee to amend the constitution, any dialogue will be a waste of time," Mohamed ElBaradei, a prominent politician who founded the Constitution Party, wrote on Twitter.

Hamdeen Sabahy, a leftist politician and presidential candidate who is another leading member of the Front, said he would not attend Monday's meeting "unless the bloodshed stops and the people's demands are met".

Ahmed Said of the liberal Free Egyptians Party said Mursi's tone on Sunday night was more threatening than conciliatory. "Egypt is in danger and completely split," he told Reuters.

Egypt's politics has become deeply polarized. Although Islamists have swept to victory in a parliamentary poll and presidential vote, the disparate opposition has been united by Mursi's bid late last year to expand his powers and fast-track a constitution with an Islamist hue through a referendum.

Mursi's opponents accuse him of listening only to his Islamist friends and reneging on a pledge to be a president for all Egyptians. Islamists say their rivals want to overthrow by undemocratic means Egypt's first freely elected leader.

The Front has distanced itself from the latest flare-ups but said Mursi should have acted far sooner to impose extra security measures that would have ended the violence.

BLAMING MURSI

"Of course we feel the president is missing the real problem on the ground, which is his own policies," spokesman Khaled Dawoud said. "His call to implement emergency law was an expected move, given what is going on, namely thuggery and criminal actions."

Even in Tahrir, some protesters said violence and the high death toll in Port Said and other cities on the strategic Suez waterway meant there was little choice but to impose emergency law, although they, too, blamed Mursi for fury on the streets.

"They needed the state of emergency there because there is so much anger," said Mohamed Ahmed, 27, a protester walking briskly from a cloud of teargas spreading into Tahrir Square.

However, activists in the three cities affected have pledged to defy the curfew that will start at 9 p.m. (1900 GMT) each evening and last until 6 a.m. (0400 GMT).

Some opposition groups have also called for more protests on Monday, which marks the second anniversary of one of the bloodiest days in the revolution that erupted on January 25, 2011, and brought an end to Mubarak's iron rule 18 days later.

Rights activists said Mursi's declaration was a backward step for Egypt, which was under emergency law for Mubarak's entire 30-year rule. His police used the sweeping arrest provisions to muzzle dissent and round up opponents, including members of the Brotherhood and even Mursi himself.

Heba Morayef of Human Rights Watch in Cairo said the police, still hated by many Egyptians for their heavy-handed tactics under Mubarak, would once again have the right to arrest people "purely because they look suspicious", undermining efforts to create a more efficient and respected police force.

"It is a classic knee-jerk reaction to think the emergency law will help bring security," she said. "It gives so much discretion to the Ministry of Interior that it ends up causing more abuse, which in turn causes more anger."

(Additional reporting by Yasmine Saleh in Cairo and Yusri Mohamed in Ismailia; Editing by Will Waterman)

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In Asia’s trend-setting cities, iPhone fatigue sets in

SINGAPORE (Reuters) – Apple Inc’s iconic iPhone is losing some of its luster among Asia’s well-heeled consumers in Singapore and Hong Kong, a victim of changing mobile habits and its own runaway success.

Driven by a combination of iPhone fatigue, a desire to be different and a plethora of competing devices, users are turning to other brands, notably those from Samsung Electronics Co Ltd, eating into Apple‘s market share.

In Singapore, Apple’s products were so dominant in 2010 that more devices here ran its iOS operating system per capita than anywhere else in the world.

But StatCounter http://gs.statcounter.com, which measures traffic collected across a network of 3 million websites, calculates that Apple’s share of mobile devices in Singapore – iPad and iPhone – declined sharply last year. From a peak of 72 percent in January 2012, its share fell to 50 percent this month, while Android devices now account for 43 percent of the market, up from 20 percent in the same month last year.

In Hong Kong, devices running Apple’s iOS now account for about 30 percent of the total, down from about 45 percent a year ago. Android accounts for nearly two-thirds.

“Apple is still viewed as a prestigious brand, but there are just so many other cool smartphones out there now that the competition is just much stiffer,” said Tom Clayton, chief executive of Singapore-based Bubble Motion http://www.bubblemotion.com, which develops a popular regional social media app called Bubbly.

Where Hong Kong and Singapore lead, other key markets across fast-growing Asia usually follow.

“Singapore and Hong Kong tend to be, from an electronics perspective, leading indicators on what is going to be hot in Western Europe and North America, as well as what is going to take off in the region,” said Jim Wagstaff, who runs a Singapore-based company called Jam Factory http://www.jamfactoryonline.com developing mobile apps for enterprises.

Southeast Asia is adopting smartphones fast – consumers spent 78 percent more on smartphones in the 12 months up to September 2012 than they did the year before, according to research company GfK http://www.gfkrt.com.

IN WITH THE YOUNG CROWD

Anecdotal evidence of iPhone fatigue isn’t hard to find: Where a year ago iPhones swamped other devices on the subways of Hong Kong and Singapore they are now outnumbered by Samsung and HTC Corp smartphones.

While this is partly explained by the proliferation of Android devices, from the cheap to the fancy, there are other signs that Apple has lost followers.

Singapore entrepreneur Aileen Sim, recently launched an app for splitting bills called BillPin http://www.billpin.com, settling on an iOS version because that was the dominant platform in the three countries she was targeting – Singapore, India and the United States.

“But what surprised us was how strong the call for Android was when we launched our app,” she said.

Indeed, 70 percent of their target users – 20-something college students and fresh graduates – said they were either already on Android or planned to switch over.

“Android is becoming really hard to ignore, around the region and in the U.S. for sure, but surprisingly even in Singapore,” she said. “Even my younger early-20s cousins are mostly on Android now.”

BillPin launched an Android version this month.

Napoleon Biggs, chief strategy officer at Gravitas Group http://www.gravitas.com.hk, a Hong Kong-based mobile marketing company, said that while Apple and the iPhone remained premium brands there, Samsung’s promotional efforts were playing to an increasingly receptive audience.

For some, it is a matter of wanting to stand out from the iPhone-carrying crowd. Others find the higher-powered, bigger-screened Android devices better suited to their changing habits – watching video, writing Chinese characters – while the cost of switching devices is lower than they expected, given that most popular social and gaming apps are available for both platforms.

“Hong Kong is a very fickle place,” Biggs said.

Janet Chan, a 25-year-old Hong Kong advertising executive, has an iPhone 5 but its fast-draining battery and the appeal of a bigger screen for watching movies is prodding her to switch to a Samsung Galaxy Note II.

“After Steve Jobs died, it seems the element of surprise in product launches isn’t that great anymore,” she said.

To be sure, there are still plenty of people buying Apple devices. Stores selling their products in places such as Indonesia were full over the Christmas holidays, and the company’s new official store in Hong Kong’s Causeway Bay has queues snaking out of the door most days.

But the iPhone’s drop in popularity in trendy Hong Kong and Singapore is mirrored in the upmarket malls of the region.

“IPhones are like Louis Vuitton handbags,” said marketing manager Narisara Konglua in Bangkok, who uses a Galaxy SIII. “It’s become so commonplace to see people with iPads and iPhones so you lose your cool edge having one.”

In the Indonesian capital Jakarta, an assistant manager at Coca Cola’s local venture, Gatot Hadipratomo, agrees. The iPhone “used to be a cool gadget but now more and more people use it.”

There is another influence at play: hip Korea. Korean pop music, movies and TV are hugely popular around the region and Samsung is riding that wave. And while the impact is more visible in Hong Kong and Singapore, it also translates directly to places like Thailand.

“Thais are not very brand-loyal,” says Akkaradert Bumrungmuang, 24, a student at Mahidol University in Bangkok. “That’s why whatever is hot or the in-thing to have is adopted quickly here. We follow Korea so whatever is fashionable in Korea will be a big hit.”

(Additional reporting by Lee Chyen Yee in Hong Kong; Khettiya Jittapong and Amy Sawitta Lefevre in Bangkok, and Andjarsari Paramaditha in Jakarta; Editing by Emily Kaiser)

Tech News Headlines – Yahoo! News

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SAG Red Carpet: Where the Party's At!

No acting here! Jennifer, Alec, Jessica and more turn up the fun on the red carpet

Credit: Chris Pizzello/Invision/AP

Updated: Sunday Jan 27, 2013 | 08:40 PM EST
By: Kate Hogan

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CDC: Flu seems to level off except in the West

New government figures show that flu cases seem to be leveling off nationwide. Flu activity is declining in most regions although still rising in the West.

The Centers for Disease Control and Prevention says hospitalizations and deaths spiked again last week, especially among the elderly. The CDC says quick treatment with antiviral medicines is important, in particular for the very young or old. The season's first flu case resistant to treatment with Tamiflu was reported Friday.

Eight more children have died from the flu, bringing this season's total pediatric deaths to 37. About 100 children die in an average flu season.

There is still vaccine available although it may be hard to find. The CDC has a website that can help.

___

CDC: http://www.cdc.gov/flu/

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Wall Street Week Ahead: Bears hibernate as stocks near record highs

NEW YORK (Reuters) - Stocks have been on a tear in January, moving major indexes within striking distance of all-time highs. The bearish case is a difficult one to make right now.

Earnings have exceeded expectations, the housing and labor markets have strengthened, lawmakers in Washington no longer seem to be the roadblock that they were for most of 2012, and money has returned to stock funds again.

The Standard & Poor's 500 Index <.spx> has gained 5.4 percent this year and closed above 1,500 - climbing to the spot where Wall Street strategists expected it to be by mid-year. The Dow Jones industrial average <.dji> is 2.2 percent away from all-time highs reached in October 2007. The Dow ended Friday's session at 13,895.98, its highest close since October 31, 2007.

The S&P has risen for four straight weeks and eight consecutive sessions, the longest streak of days since 2004. On Friday, the benchmark S&P 500 ended at 1,502.96 - its first close above 1,500 in more than five years.

"Once we break above a resistance level at 1,510, we dramatically increase the probability that we break the highs of 2007," said Walter Zimmermann, technical analyst at United-ICAP, in Jersey City, New Jersey. "That may be the start of a rise that could take equities near 1,800 within the next few years."

The most recent Reuters poll of Wall Street strategists estimated the benchmark index would rise to 1,550 by year-end, a target that is 3.1 percent away from current levels. That would put the S&P 500 a stone's throw from the index's all-time intraday high of 1,576.09 reached on October 11, 2007.

The new year has brought a sharp increase in flows into U.S. equity mutual funds, and that has helped stocks rack up four straight weeks of gains, with strength in big- and small-caps alike.

That's not to say there aren't concerns. Economic growth has been steady, but not as strong as many had hoped. The household unemployment rate remains high at 7.8 percent. And more than 75 percent of the stocks in the S&P 500 are above their 26-week highs, suggesting the buying has come too far, too fast.

MUTUAL FUND INVESTORS COME BACK

All 10 S&P 500 industry sectors are higher in 2013, in part because of new money flowing into equity funds. Investors in U.S.-based funds committed $3.66 billion to stock mutual funds in the latest week, the third straight week of big gains for the funds, data from Thomson Reuters' Lipper service showed on Thursday.

Energy shares <.5sp10> lead the way with a gain of 6.6 percent, followed by industrials <.5sp20>, up 6.3 percent. Telecom <.5sp50>, a defensive play that underperforms in periods of growth, is the weakest sector - up 0.1 percent for the year.

More than 350 stocks hit new highs on Friday alone on the New York Stock Exchange. The Dow Jones Transportation Average <.djt> recently climbed to an all-time high, with stocks in this sector and other economic bellwethers posting strong gains almost daily.

"If you peel back the onion a little bit, you start to look at companies like Precision Castparts , Honeywell , 3M Co and Illinois Tool Works - these are big, broad-based industrial companies in the U.S. and they are all hitting new highs, and doing very well. That is the real story," said Mike Binger, portfolio manager at Gradient Investments, in Shoreview, Minnesota.

The gains have run across asset sizes as well. The S&P small-cap index <.spcy> has jumped 6.7 percent and the S&P mid-cap index <.mid> has shot up 7.5 percent so far this year.

Exchange-traded funds have seen year-to-date inflows of $15.6 billion, with fairly even flows across the small-, mid- and large-cap categories, according to Nicholas Colas, chief market strategist at the ConvergEx Group, in New York.

"Investors aren't really differentiating among asset sizes. They just want broad equity exposure," Colas said.

The market has shown resilience to weak news. On Thursday, the S&P 500 held steady despite a 12 percent slide in shares of Apple after the iPhone and iPad maker's results. The tech giant is heavily weighted in both the S&P 500 and Nasdaq 100 <.ndx> and in the past, its drop has suffocated stocks' broader gains.

JOBS DATA MAY TEST THE RALLY

In the last few days, the ratio of stocks hitting new highs versus those hitting new lows on a daily basis has started to diminish - a potential sign that the rally is narrowing to fewer names - and could be running out of gas.

Investors have also cited sentiment surveys that indicate high levels of bullishness among newsletter writers, a contrarian indicator, and momentum indicators are starting to also suggest the rally has perhaps come too far.

The market's resilience could be tested next week with Friday's release of the January non-farm payrolls report. About 155,000 jobs are seen being added in the month and the unemployment rate is expected to hold steady at 7.8 percent.

"Staying over 1,500 sends up a flag of profit taking," said Jerry Harris, president of asset management at Sterne Agee, in Birmingham, Alabama. "Since recent jobless claims have made us optimistic on payrolls, if that doesn't come through, it will be a real risk to the rally."

A number of marquee names will report earnings next week, including bellwether companies such as Caterpillar Inc , Amazon.com Inc , Ford Motor Co and Pfizer Inc .

On a historic basis, valuations remain relatively low - the S&P 500's current price-to-earnings ratio sits at 15.66, which is just a tad above the historic level of 15.

Worries about the U.S. stock market's recent strength do not mean the market is in a bubble. Investors clearly don't feel that way at the moment.

"We're seeing more interest in equities overall, and a lot of flows from bonds into stocks," said Paul Zemsky, who helps oversee $445 billion as the New York-based head of asset allocation at ING Investment Management. "We've been increasing our exposure to risky assets."

For the week, the Dow climbed 1.8 percent, the S&P 500 rose 1.1 percent and the Nasdaq advanced 0.5 percent.

(Reporting by Ryan Vlastelica; Additional reporting by Chuck Mikolajczak; Editing by Jan Paschal)

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Egyptian youths, police clash in fourth day of violence

CAIRO (Reuters) - Police fired teargas at dozens of stone-throwing protesters in Cairo on Sunday in a fourth day of street clashes that have killed at least 42 people and compounded the challenges facing President Mohamed Mursi.

In the worst violence, security sources said 33 people died in Port Said on Saturday when protests erupted after a court sentenced 21 people, mostly from the city, to death for their role in a deadly stadium disaster last year.

Thousands of mourners joined funeral processions for the dead in Port Said on Sunday, a witness said by telephone, adding that he heard gunshots and the sound of emergency vehicle sirens. But there were no immediate reports of new casualties.

Mursi's opponents have also taken to the streets across Egypt since Thursday, accusing him and his Islamist allies of betraying the uprising that overthrew Hosni Mubarak in 2011.

"None of the revolution's goals have been realized," said Mohamed Sami, a protester in Cairo's Tahrir Square on Sunday.

"Prices are going up. The blood of Egyptians is being spilt in the streets because of neglect and corruption and because the Muslim Brotherhood is ruling Egypt for their own interests."

On a bridge close to Tahrir Square, youths hurled stones at police in riot gear who fired teargas to push them back towards the square, the cauldron of the uprising that erupted on January 25, 2011 and toppled Mubarak 18 days later.

The latest protests were initially timed to mark Friday's anniversary of that revolt.

The U.S. and British embassies, both close to Tahrir, said they were closed for public business on Sunday.

The violence adds to the daunting task facing Mursi as he tries to fix a beleaguered economy and cool tempers before a parliamentary election expected in the next few months which is supposed to cement Egypt's transition to democracy.

It has exposed a deep rift in the nation. Liberals and other opponents accuse Mursi of failing to deliver on economic promises and say he has not lived up to pledges to represent all Egyptians. His backers say the opposition is seeking to topple Egypt's first freely elected leader by undemocratic means.

DIVISIONS

The army, Egypt's interim ruler until Mursi's election in June, was sent back onto the streets to restore order in Port Said and Suez, another port city on the Suez Canal where at least eight people have been killed in clashes with police.

In Port Said, residents had reported gunshots overnight and shops and many workplaces were shut on Sunday. Residents said the city had been tense ahead of the funerals amid fears the burials could set off further violence.

Many Egyptians are frustrated by the regular escalations that have hurt the economy and their livelihoods.

"They are not revolutionaries protesting," said taxi driver Kamal Hassan, 30, referring to those gathered in Tahrir. "They are thugs destroying the country."

The National Defence Council, headed by Mursi, has called for a national dialogue to discuss political differences.

That offer has been cautiously welcomed by the opposition National Salvation Front. But the coalition has demanded a clear agenda and guarantees that any agreements will be implemented.

The Front, formed late last year when Mursi provoked protests and violence by expanding his powers and driving through an Islamist-tinged constitution, has threatened to boycott the parliamentary poll and to call for more protests if a list of demands is not met, including having an early presidential vote.

Egypt's transition has been blighted from the outset by political rows and turbulence on the streets that have driven investors out and kept many tourists away, starving the economy of vital sources of hard currency.

Egypt's defense minister who also heads the army, Abdel Fattah al-Sissi, called for the nation to stand together and said the military would not prevent peaceful protests. But he called on demonstrators to protect public property.

Clashes in Port Said erupted after a judge sentenced 21 men to death for involvement in 74 deaths at a soccer match on February 1, 2012 between Cairo's Al Ahly club and the local al-Masri team. Many of the victims were fans of the visiting team.

There were 73 defendants in the case. Those not sentenced on Saturday will face a verdict on March 9, the judge said.

Al Ahly fans cheered the verdict after threatening action if the death penalty was not meted out. But Port Said residents were furious that people from their city were held responsible.

(Additional reporting by Shaimaa Fayed in Cairo and Yusri Mohamed in Ismailia; Editing by Janet Lawrence)

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