UK prosecutors consider charges over royal hoax call

LONDON (Reuters) – British detectives investigating the death of a nurse found hanged after she took a prank phone call at a hospital treating Prince William‘s pregnant wife Kate have passed an evidence file to prosecutors, police said on Saturday.

Public prosecutors must decide whether the case is strong enough to bring charges over a stunt that was condemned around the world and fuelled concerns about media ethics.

Indian-born Jacintha Saldanha, 46, was found hanging in her hospital lodgings in London, days after she answered the hoax call from an Australian radio station, an inquest heard.

She put the call through to a colleague who disclosed details of the Duchess of Cambridge‘s condition during treatment for an extreme form of morning sickness in the early stages of pregnancy.

“Officers submitted a file to the Crown Prosecution Service (CPS) for them to consider whether any potential offences may have been committed by making the hoax call,” London’s Metropolitan Police said in a statement.

A CPS spokesman confirmed it had received the file, but declined to comment on the timing or nature of possible charges.

“That is what we will be considering,” he said.

Prime Minister David Cameron has described the case as a “complete tragedy” and has said many lessons will have to be learned from the nurse’s death.

Australia’s media regulator has launched an investigation into the phone call. Southern Cross Austereo, parent company of radio station 2Day FM, has apologised for the stunt.

Britain’s own media is already under pressure to agree a new system of self-regulation and avoid state intervention following a damning inquiry into reporting practices.

The presenters who made the call, Mel Greig and Michael Christian, have apologised for their actions.

(Reporting by Peter Griffiths; Editing by Stephen Powell)

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Signs suggest better economy if ‘cliff’ is averted

WASHINGTON (AP) — Fresh signs of a strengthening U.S. economy on Friday suggested that if Congress and the White House can avert the “fiscal cliff,” the economic recovery might finally accelerate in 2013.

Consumers spent and earned more in November. And for a second straight month, U.S. companies increased their orders for a category of manufactured goods that reflects investment plans.

In light of the latest figures, some analysts said the economy could end up growing faster in the current October-December quarter — and next year — than they previously thought.

“I see momentum building,” said Joel Naroff, chief economist at Naroff Economic Advisors. “If Washington makes the moves it needs to make, then the economy should pick up speed next year.”

That’s a big “if.” House Republicans called off a vote on tax rates and left budget talks in disarray 10 days before the package of tax increases and spending cuts known as the fiscal cliff would take effect.

Still, helping lift the optimism of some analysts was a government report that consumer spending, which fuels about 70 percent of the economy, rose 0.4 percent in November compared with October. Spending had dipped 0.1 percent in October. But that decline was linked in part to disruptions from Superstorm Sandy.

Incomes rose 0.6 percent in November, the biggest gain in 11 months. It reflected a rebound in wages and salaries, which had been depressed in October. Damage from Sandy in the Northeast prevented some people from working at the end of October and reduced wages at an annual rate of $ 18 billion.

A separate report Friday showed that a category of durable-goods orders that tracks business investment surged 2.7 percent. That gain followed an upwardly revised 3.2 percent jump in October, the biggest in 10 months.

The back-to-back increases followed a period of weakness in so-called core capital goods that had raised concerns about business investment, a driving force in the economy.

The economy grew in the July-September quarter at a solid 3.1 percent annual rate. But some analysts said they thought growth would slow significantly in the October-December period. They predicted that consumers and businesses would cut back on spending because of worries about the fiscal cliff.

But after Friday’s reports, Peter Newland, an economist at Barclays Capital, said Barclays is raising its estimate of growth in the current quarter to a 2.4 percent annual rate, from a previous estimate of 2.2 percent.

Naroff said he thinks growth in the fourth quarter can reach a 2.6 percent annual rate. He said he expects growth to hit a rate of around 3.2 percent in the January-March quarter and 3.6 percent in the April-June quarter.

He said those estimates are based on his confidence that Washington policymakers will avert the sharp tax increases and spending cuts, which could trigger a recession if they remain in place for much of 2013.

Naroff said U.S. economic growth would benefit next year from a rebounding housing market, gradual hiring gains that will boost incomes and the likelihood that Europe’s financial crisis will ease and dampen U.S. exports less than in 2012.

But he said his optimistic forecasts would be derailed if the economy goes off the fiscal cliff in January, which could send shockwaves through financial markets.

“If the fiscal cliff is breached, the biggest concern is confidence,” Naroff said. “I remain hopeful that saner heads will prevail in Washington.”

Economists said the budget impasse and the uncertainty it’s created about tax rates are reducing consumer confidence. The University of Michigan said Friday that its index of consumer sentiment for December fell to 72.9, its lowest point since July. It was a sharp drop from the November reading of 82.7, a five-year high.

Chris G. Christopher Jr., senior economist at IHS Global Insight, said he still expected holiday retail sales to increase a respectable 3.9 percent this year over last year despite slumping consumer confidence. And he said spending momentum should continue into 2013 — as long as the fiscal cliff is resolved in a way that avoids damaging the economy.

“We are assuming that the fiscal cliff does get resolved, and if it does, we should see strong consumer spending and momentum for the economy in 2013,” Christopher said. “But if we go down the fiscal cliff, then the first quarter will not be pretty.”

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Showrooming little threat to clothiers in ho-hum holidays

Chicago (Reuters) – In retail, showrooming has not hit shirts yet.

Showrooming, the retail term for shoppers who try a product, then buy it cheaper on Amazon.com or other websites, has driven retailers to the point of hiding barcodes, improving their own websites and coming up with methods to get people to complete their purchase in the store.

But brand-name clothing retailers have an advantage over companies that sell items you can buy anywhere, like televisions and home goods.

“Specialty apparel retailers are some of the least affected by showrooming since the more exclusive the product is, the harder it is to showroom,” said Joel Bines, managing director of the retail practice at advisory firm AlixPartners.

That, in turn, has helped retailers like Gap Inc and Lululemon Athletica Inc find favor with investors.

A survey of 2,010 adults conducted by AlixPartners showed consumers who shop for apparel were among the least likely (35 percent) to go to other websites after they liked an item at a store, compared with 42 percent of electronics shoppers and 41 percent of those looking for accessories like watches and jewelry.

“If you look at some of the most successful (clothes) companies in the past few years, they are those that have that moat around them,” said hedge fund manager Shawn Kravetz, who runs Esplanade Capital in Boston.

He cites yogawear maker Lululemon and Gap as good examples of how it can help to have clothes that are not sold elsewhere.

If a shopper wants to buy a Banana Republic or Nordstrom shirt from the latest season, they have to buy it either from their stores or online shop.

Discount retailers like Zappos, Amazon and others stock brand-name products, but the merchandise is often not from the current season or limited in colors and sizes.

“I don’t need to see if a television fits my body shape when I buy a TV,” said Joe Megibow, senior vice president of omni-channel e-commerce at American Eagle Outfitters. The teen clothes retailer has seen better sales than its peers over the past year.

“I can get a sense of the TV and I’m good. Clothing is different. Does it fit me, is it my style, do I like the quality of the material and how it is put together. There’s so much more with apparel that matters,” he said.

That is the part of the reason, analysts say, why online-only clothing companies like Bonobos and Gap’s Piperlime have started opening brick-and-mortar stores or tied up with retailers to sell their products in physical locations.

Choice and easy availability are the two most important aspects of shopping, especially during a holiday season that has lost steam after what looked like strong Thanksgiving sales.

Estelle Tran, an “impulsive” shopper in her twenties, agreed.

“If I want to buy books, tech items, DVDs, I would definitely buy online. For clothes, I would rather (visit stores) as it is also a fun experience to try on clothes,” said the Chicago-based finance auditor.

Tran said she would definitely check prices online if she was spending more than $ 100.

Luxury and high-priced items can be more susceptible to showrooming, because pricing is what drives the behavior, said Marshal Cohen, chief economist at the consultancy NPD Group.

“With electronics and certain consumer goods it is very easy to compare specific brands across multiple websites. But (showrooming is) happening and it will be growing. If a (clothes) retailer isn’t taking it seriously, they are going to fall behind,” said Bolette Andersen, principal in KPMG’s retail industry practice.

ROOM TO GROW

Some investors are betting on apparel stocks because of their relative insulation from the threat of showrooming.

While the S&P Apparel Index has returned a sizzling 27.71 percent year to date, according to Reuters data, far outperforming the S&P 500, which is up 14.80 percent, more gains may be coming.

“We still think there’s plenty of room to grow,” said Brian Peery, co-portfolio manager at Hennessy Funds. Its growth fund, heavily weighted in apparel and consumer discretionary goods shares, is up 30 percent over the year.

“As we look into the sector 12-18 months, we continue to buy the discretionary area. Two of our heaviest investments would be Foot Locker Inc and TJX Companies Inc,” he said.

Discount chains like TJX and Ross Stores, which sell branded clothes at low prices, have benefited from the surge in bargain-seeking shoppers.

Even the stocks of retailers like Gap and American Eagle that have staged or are staging turnarounds have gotten a good boost over the year. Gap has soared 69 percent and American Eagle is up 31 percent.

R. Shawn Neville, president of Avery Dennison retail branding and information solutions, said another reason that apparel and to a broader extent other consumer discretionary stocks do well is because of their sustainability.

“In uncertain times, investors look towards market segments that have strong underlying demand which are more stable, like the apparel industry,” Neville said.

Moreover, in times of economic uncertainty, shoppers can still afford clothes and shoes, as opposed to a new car, home, or expensive vacations, helping apparel stocks do well, he said.

“Though Amazon is clearly stealing some share in various categories, clothes retailers, say Abercrombie & Fitch isn’t going anywhere. They’re not being run out of the shopping mall,” said Esplanade’s Kravetz.

(Editing by Jeffrey Benkoe)

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Suicide bombers attack mobile phone firms in Nigeria

KANO, Nigeria (Reuters) – Two suicide car bombers attacked the offices of mobile phone operators India’s Airtel and South Africa’s MTN on Saturday in Nigeria’s northern city of Kano, killing themselves but no civilians, police said.

Islamist sect Boko Haram has previously targeted phone firms, blowing up telephone masts and offices, saying the companies help the security forces catch its members.

“The one who hit the Airtel office was shot by military men before the bomb exploded … at the MTN office the car rammed into the fence but no civilians were killed,” Ibrahim Idris, the chief of police in Kano, told Reuters.

Airtel Nigeria’s parent company Bharti Airtel, India’s top cellphone operator, gave no immediate comment.

The national emergency agency confirmed the bombing and said it was not aware of any civilian casualties. The security forces have played down the death toll in previous bombings.

At least 2,800 people have died in fighting in the largely Muslim north since the sect launched an uprising against the government in 2009, watchdog Human Rights Watch says.

The sect wants to impose strict Islamic law on a country of 160 million people split roughly equally between Christians and Muslims.

The group has previously targeted churches on Christmas Day and security has been increased in all the major northern cities, although security experts say given the scale of Christian worship in Nigeria they cannot protect everyone.

Kano, Nigeria‘s second largest city after the southern commercial-hub Lagos, was the site of Boko Haram’s most lethal attack which killed at least 186 people in January in coordinated bombings and shootings.

(Additional reporting by Isaac Abrak in Kaduna; Writing by Joe Brock; Editing by Andrew Osborn and Janet Lawrence)

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Crafters send mittens with a message to Newtown

“Chester Raccoon stood at the edge of the forest and cried. ‘I don’t want to go to school,’ he told his mother. ‘I want to stay home with you. I want to play with my friends. And play with my toys. And read my books. And swing on my swing. Please may I stay home with you?’” — “The Kissing Hand,” by Audrey Penn.

___

NEW YORK (AP) — Imagining the horror for Sandy Hook Elementary students when they walk into their new school for the first time, a Connecticut mom is relying on Chester of the children’s classic “The Kissing Hand” and the busy fingers of her fellow knitters to ease their way.

Kim Piscatelli of East Hampton, Conn., hit on the idea of sending a copy of the book for each of the kids and a pair of handmade mittens adorned with a heart in one palm, signifying the reassuring kiss left there by the mother of scared, sad Chester in the story written by Audrey Penn.

Piscatelli, a 40-minute drive from Newtown, sent out a call to her friends, who called on their friends. The project she thought up just Sunday spread quickly on Facebook and websites for knitters and crafters, with the first shipment of books and mittens scheduled to land in Newtown the first week of January.

“I thought, how are those families ever going to get back in a routine of sending their children to school? If there ever was a town that needed to know about that book, it was Newtown,” said an overwhelmed Piscatelli, who now has a warehouse stacked with 1,600 copies of the book and plenty of volunteers to sort, pack and ship.

Others are hurriedly making mittens, from California and Canada to Florida and the U.S. Virgin Islands, in time for the start of classes in a once-shuttered school in nearby Monroe. A knitters’ group in Georgia pulled an all-night “knitathon” for the cause, Piscatelli said.

The book’s publisher, Tanglewood Press, has donated the books, along with enough copies of a sequel dealing with Chester’s loss of a playmate for teachers to read aloud.

In “The Kissing Hand,” the tearful boy is heading off to school for the first time, but he begs his mother to stay home. She spreads his tiny fingers and kisses him square in the palm and tells him “whenever you feel lonely and need a little loving from home, just press your hand to your cheek and think, ‘Mommy loves you.’”

The story was first published in 1993 by the Child Welfare League of America, a Washington, D.C.-based coalition of agencies and organizations helping children at risk. Penn had tried and failed for years to get her story of Chester published, until a league official heard Penn read it and decided to take it on.

“At first, no bookstore, no wholesaler would carry it,” said Peggy Tierney, who worked at the league and took Penn with her after starting Tanglewood. “Then kindergarten teachers discovered it, word spread, people started going into stores trying to find copies, then everyone started carrying it, and by 1999 it was on the New York Times best-seller list.”

One of Piscatelli’s first stops in getting her mitten project off the ground was to contact Penn, who lives in Durham, N.C. She recalled reading the story to her own three kids when they were younger.

Penn, who lost a brother to drowning when she was 13, signed off on the combined book-mitten project as soon as Piscatelli contacted her.

“When I saw the news, my heart was just torn in half. I couldn’t breathe. I couldn’t breathe. Enough is enough is enough,” the writer said.

Penn’s 2009 sequel, called “Chester the Raccoon and the Acorn Full of Memories,” has Chester the boy raccoon working through the death of a friend, Skiddil Squirrel, who has an accident. Chester’s teacher tells his class Skiddil won’t return to school, so Chester and his mother venture to a butterfly pond where the squirrel loved to play to discover some acorns Skiddil left there have sprouted into young trees.

“I’ve been involved with so many parents who have lost children,” Penn said. “They just seem to reach out to me and say we love your book and your book has been a comfort.”

The writer hopes the children of Sandy Hook will “get a sense of some kind of security” from the mitten project. “They’ll have a way of keeping in tangible touch with someone at home, someone they feel very secure with.”

Meantime, Piscatelli and dozens of knitters who have contacted her through the project’s Facebook page are pressing on to get the books and mittens in the students’ hands. About 600 kids attended Sandy Hook when Lanza opened fire, but Piscatelli plans to share mittens and books with all the schoolchildren of Newtown.

“The original request was for hand-knit mittens with a heart knit in, embroidered on or sewn on,” she said. “The reality is we have people sewing polar fleece mittens, mittens made from recycled sweaters, store-bought mittens. Every pair of handmade or store-bought mittens will have a heart sewn on if it isn’t there when we receive them.”

Piscatelli has heard from other crafters who plan related Kissing Hand projects, including a group of schoolchildren in Mississippi making pillows.

“Everybody wants to help,” she said. “Everybody’s looking for some way to reach out.”

When a company called Oceanhouse Media learned of Piscatelli’s idea they released a digital version of “The Kissing Hand” early and free of cost in the iTunes app store. Piscatelli has also heard from the loved ones of grown-up volunteers on the ground in Newtown.

“I got a call from a woman who said my father is with the Red Cross,” Piscatelli said. “He’s a psychologist and is there now and I really think he needs a pair of Kissing Hand mittens.”

___

Follow Leanne Italie on Twitter at https://twitter.com/litalie

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China probes safety of Yum Brands’ KFC chicken products

SHANGHAI (Reuters) – Yum Brands Inc‘s fast-food chain KFC was supplied with chicken in China that contained excessive amounts of antibiotics, said food safety authorities investigating allegations of tainted KFC products.

The finding by the Shanghai Food and Drug Administration (SFDA) deals a blow to KFC’s reputation in China, where it is facing fierce competition from the likes of Taiwanese-owned fried chicken chain Dico and Japanese-style noodle chain Ajisen (China) Holdings Ltd. Yum Brands has forecast a drop in same store China sales in the fourth quarter.

Eight of the 19 batches of chicken samples Yum Brands sent to a testing laboratory in 2010 and 2011 contained overly high levels of antibiotics, the SFDA said in a statement on its Website late on Thursday.

An investigation is underway to determine whether Yum Brands had taken corrective measures at that time, and the Louisville, Kentucky-based company may face harsh penalties if the probe showed laws had been violated, the SFDA said.

On Friday afternoon, Yum said it was cooperating with the Chinese government’s review of two poultry suppliers who provided chicken with unapproved levels of antibiotics to KFC, adding that these suppliers “represent an extremely small percentage of product to KFC.”

In a securities filing dated Dec 21, the company said it does not anticipate a shortage of product supply, though “recent publicity has resulted in moderate sales impact the past few days.”

Shares in Yum Brands have slumped 4 percent since December 18 when China’s state television CCTV reported that some poultry suppliers in eastern Shandong province had fed chickens with anti-viral drugs and hormones to accelerate their growth.

The SFDA is looking into the CCTV report and has not released its findings yet, but authorities in Shandong have already shut two chicken farms in eastern China, including one that supplied KFC and McDonald’s Corp, the official Shanghai Daily newspaper reported on Thursday.

KFC’s subsidiary in China has pledged to cooperate with the authorities, while McDonald’s wrote on its official microblog that its chicken and raw materials pass through independent, third-party laboratory tests.

Shares in Yum Brands, which also owns Pizza Hut and Taco Bell, closed 1 percent lower at $ 69.49 in New York on Thursday.

China has been trying to stamp out health violations that have dogged the country’s food sector amid reports of fake cooking oil, tainted milk and even exploding watermelons. In 2008, milk laced with the industrial chemical melamine killed at least six children and sickened nearly 300,000.

(Reporting by Nivedita Bhattacharjee in Chicago, Samuel Shen and Kazunori Takada; Editing by Ryan Woo and Richard Chang)

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Hurting Spaniards pin hopes on Christmas lottery

MADRID (AP) — After another brutal year of economic hardship, Spaniards across the country are hoping for relief when the country’s famed Christmas lottery — the world’s richest — pays out €2.5 billion ($ 3.3 billion) in tax-free awards on Saturday.

Almost everyone in the country of 46 million people will be glued to live TV to watch school children sing out the winning numbers for the lottery that pays out maximum prizes of €400,000 ($ 529,840) and many more for smaller amounts. The top prize is dubbed “El Gordo” (“The Fat One”) and is likely to be won by hundreds if not thousands of players.

Unlike other big lotteries that generate just a few big winners, Spain‘s lottery — now in its 200th year — has always aimed for a share-the-wealth-system rather than a single jackpot, and thousands of numbers yield at least some kind of return.

The Christmas lottery is so popular that there are frequently three €20 ($ 26) tickets sold for every Spaniard, and the lottery itself is the unofficial kickoff of the holiday season.

“A lot of people win,” said Pablo Foncillas, a marketing professor at the IESE Business School in Madrid. “It’s really common even if you don’t win to get a free ticket. So many people win that people just keep on playing. Everyone knows someone who’s won, even if it’s only a little bit.”

Hundreds of players lined up daily to buy tickets this week outside the Dona Manuelita lottery store in Madrid, which has often sold winning tickets. Before Spain’s property-led economic boom collapsed in 2008, they had hoped to win so they could buy a small apartment or a car. Now people said they need the money just to hang on to what they have and avoid being evicted or having cars repossessed.

Betting that tickets from Dona Manuelita stood a better chance of winning, unemployed construction company office manager Miguel Angel Ruiz drove 165 kilometers (102 miles) to buy for a pool of players including his wife and relatives.

“We’re buying more hoping we’ll hit it so we can emerge from poverty,” said Ruiz, 39. “Before the crisis, lottery winnings were to buy an apartment or a car, and now it’s to pay debts.”

Diego Sanbrano, let go from his waiter’s job two months ago, said the Spanish lottery isn’t about getting rich and never working again.

“It’s to pay off debts and straighten out your life,” he said. “You pay the mortgage and make the car payment, and then maybe you have a little left over to go somewhere on vacation.”

Since so many people chip in to buy tickets in groups, the top prizes frequently end up being handed out in the same small town or in one city neighborhood. Last year’s top winning number hit for 1,800 tickets in the northern town of Granen, population 2,000. Townspeople shared about €700 million ($ 925 million), and the rest of the €1.8 billion ($ 2.4 billion) was doled out in smaller prizes around Spain.

The Dec. 22 lottery began in 1812 and last year sold an estimated €2.7 billion ($ 3.6 billion) in tickets with per-capita spending of about €70 ($ 92) just for the Christmas lottery.

Spain holds another big lottery Jan. 6 to mark the Feast of the Epiphany. It is known as “El Nino” (The Child), in reference to the baby Jesus.

But the crisis will hit El Nino and all lotteries going forward. Until now, lottery winnings have been free from taxation. Waves of austerity measures imposed by the government this year to prevent Spain from asking for public finances bailout like those for Greece, Ireland and Portugal have translated into higher taxes. Lottery winnings above €2,000 ($ 2,640) will face a 20 percent tax in 2013.

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Kenya police: 28 people killed in clashes

NAIROBI, Kenya (AP) — A police official says 28 people have been killed in clashes between farmers and herders in south-eastern Kenya.

Anthony Kamitu, who is leading police operations to prevent the attacks, said Friday that the Pokomo tribe of farmers raided a village of the Orma herding community, called Kipao, at dawn in the Tana River Delta.

The latest deaths in a tit-for-tat cycle of killings may be related to a redrawing of political boundaries and next year’s general elections, according to the U.N.

At least 110 people were killed in clashes between the Pokomo and Orma in September and October.

Animosity between the two communities over land and water resources has existed for decades.

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Facebook tests $1 fee for messages to non-friends

SAN FRANCISCO (AP) — Facebook says it is testing a service that will charge users $ 1 to guarantee that messages they send to people they are not connected to arrive in users’ inboxes, rather than in an often-ignored folder called “other.”

Launched in 2011, the “other” folder is where Facebook routes messages it deems less relevant. Not quite spam, these include messages from people you most likely don’t know, based on Facebook’s reading of your social connections. Many users ignore this folder.

Now, users will be able to pay $ 1 to route their messages to non-friends. Facebook said Thursday that it is testing the service with a small percentage of individuals — not businesses — in the U.S.

“For example, if you want to send a message to someone you heard speak at an event but are not friends with, or if you want to message someone about a job opportunity, you can use this feature to reach their Inbox,” Facebook said in an online post. “For the receiver, this test allows them to hear from people who have an important message to send them.”

The company says charging for messages could help discourage spammers.

In October, Facebook unveiled another feature that lets users pay if they want more people to read their updates. For $ 7, users can promote a post to their friends, just as advertisers do.

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Martha Raddatz, Hot Off Debate Performance, Promoted at ABC News

NEW YORK (TheWrap.com) – Martha Raddatz, widely praised for her moderation of the vice presidential debate in October, has been given an expanded role as ABC News’ chief global affairs correspondent. Jonathan Karl, meanwhile, will become the network’s new chief White House correspondent, filling the void left by Jake Tapper‘s exit to CNN.

Raddatz will replace Tapper as the primary substitute for George Stephanopoulos on “This Week” and will contribute regularly to the Sunday morning show’s roundtable. Karl will also serve as a substitute and regularly appear on the roundtable.

Tapper departed ABC in part because he has long been interested in hosting “This Week” full-time, but Stephanopoulos has no plans to give up the hosting job, a person familiar with the situation told TheWrap.

ABC News President Ben Sherwood announced the new assignments for Raddatz and Karl on Thursday, soon after CNN announced Tapper’s hiring.

Karl has investigated wasteful federal spending, covered elections, and served as the network’s senior national security correspondent.

Raddatz has reported from the Pentagon, the State Department, the White House, and from conflict zones worldwide, including Afghanistan and Iraq.

But she has been perhaps most celebrated for keeping the vice presidential debate between Joe Biden and Paul Ryan on course after the moderator of the first presidential debate, Jim Lehrer, was accused of letting the candidates run amok.

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