Susan Powell's Father-in-Law Secretly Took 4,500 Pictures of Her
Label: LifestyleWrapping up a year that has brought unimaginable frustration and heartbreak, Susan Powell's family marked the three-year anniversary of her disappearance at a ceremony this week near where her two sons are buried.
The Coxes hoped Steve Powell's voyeurism trial in May would unearth some answers but it did not. Powell invoked his Fifth Amendment right against self-incrimination when asked in jail about Susan.
"It's a hard time of year," Susan's father, Chuck Cox, tells PEOPLE. "Our daughter's still missing. Someday, we will find out what happened to her."
He added that he is not sure what to make of a West Valley City, Utah, police announcement Thursday that their investigation into Susan's Dec. 6, 2009 disappearance remains active but "has been scaled down," with a reduction in the number of full-time investigators working the case.
The announcement came at the same time that more evidence emerged of the alleged obsession Susan's father-in-law, Steven Powell, had toward her. Authorities released nearly 4,500 pictures that they say he secretly took of her at home and elsewhere.
Cox says he's hopeful that the police are still doing everything possible to solve Susan's case, but he hasn't ruled out suing the department for failing to arrest Susan's husband, Josh Powell, for her murder.
More than two years after Susan's disappearance, Josh on Feb. 5 murdered the couple's two sons and committed suicide by blowing up his house.
Cox's lawyer, Anne Bremner, says Cox "goes back and forth" over whether to sue West Valley City. "He wants them to find her. A lawsuit can have a chilling affect on things."
Cox and Bremner say they do plan to file a lawsuit against the state of Washington for continuing to give Josh visitation with his children despite what they claim were mounting concerns regarding his mental stability.
Although Cox and the police believe that Josh Powell knew more than anyone what happened to Susan, they also strongly suspect that his father, Steven Powell, should still be looked at more closely.
Steven Powell
Ted S. Warren / AP
In numerous interviews with PEOPLE, Steve and Josh Powell denied any involvement in Susan's disappearance and have suggested that she ran off with another man.
Steve Powell was prosecuted for surreptitiously photographing his neighbor's young daughters (and is serving a 30-month sentence), but the investigation also unearthed journals in which Powell described his interest in his daughter-in-law, as well as the thousands of photos, which were released Thursday to the Associated Press.
In a journal entry, Steven Powell recalls a sexually charged dream in which Susan asks him, “Do you think I would make a good wife for you?” None of the pictures show Susan naked, although there are images of her crotch and backside.
"We think he knows exactly where our daughter is," Cox says.
Once Susan disappeared, Josh sold the family's home in Utah and moved with the boys into Steven Powell's house in Puyallup, Wash., only about two miles from the Cox family.
On Thursday, families streamed to Puyallup’s Woodbine Cemetery to remember the Powell boys and other children who died tragically and to dedicate a memorial: a bronze angel inspired by the novella The Christmas Box, in which strangers learn the value of love following a child’s death.
The novella's author, Richard Paul Evans, also attended the dedication. The memorial is on a hill overlooking the boys' gravesites 75 yards away.
"We get a lot of support from a lot of people and we're going to make it through," Cox says.
Smokers celebrate as Wash. legalizes marijuana
Label: HealthSEATTLE (AP) — The crowds of happy people lighting joints under Seattle's Space Needle early Thursday morning with nary a police officer in sight bespoke the new reality: Marijuana is legal under Washington state law.
Hundreds gathered at Seattle Center for a New Year's Eve-style countdown to 12 a.m., when the legalization measure passed by voters last month took effect. When the clock struck, they cheered and sparked up in unison.
A few dozen people gathered on a sidewalk outside the north Seattle headquarters of the annual Hempfest celebration and did the same, offering joints to reporters and blowing smoke into television news cameras.
"I feel like a kid in a candy store!" shouted Hempfest volunteer Darby Hageman. "It's all becoming real now!"
Washington and Colorado became the first states to vote to decriminalize and regulate the possession of an ounce or less of marijuana by adults over 21. Both measures call for setting up state licensing schemes for pot growers, processors and retail stores. Colorado's law is set to take effect by Jan. 5.
Technically, Washington's new marijuana law still forbids smoking pot in public, which remains punishable by a fine, like drinking in public. But pot fans wanted a party, and Seattle police weren't about to write them any tickets.
In another sweeping change for Washington, Gov. Chris Gregoire on Wednesday signed into law a measure that legalizes same-sex marriage. The state joins several others that allow gay and lesbian couples to wed.
The mood was festive in Seattle as dozens of gay and lesbian couples got in line to pick up marriage licenses at the King County auditor's office early Thursday.
King County and Thurston County announced they would open their auditors' offices shortly after midnight Wednesday to accommodate those who wanted to be among the first to get their licenses.
Kelly Middleton and her partner Amanda Dollente got in line at 4 p.m. Wednesday.
Hours later, as the line grew, volunteers distributed roses and a group of men and women serenaded the waiting line to the tune of "Chapel of Love."
Because the state has a three-day waiting period, the earliest that weddings can take place is Sunday.
In dealing with marijuana, the Seattle Police Department told its 1,300 officers on Wednesday, just before legalization took hold, that until further notice they shall not issue citations for public marijuana use.
Officers will be advising people not to smoke in public, police spokesman Jonah Spangenthal-Lee wrote on the SPD Blotter. "The police department believes that, under state law, you may responsibly get baked, order some pizzas and enjoy a 'Lord of the Rings' marathon in the privacy of your own home, if you want to."
He offered a catchy new directive referring to the film "The Big Lebowski," popular with many marijuana fans: "The Dude abides, and says 'take it inside!'"
"This is a big day because all our lives we've been living under the iron curtain of prohibition," said Hempfest director Vivian McPeak. "The whole world sees that prohibition just took a body blow."
Washington's new law decriminalizes possession of up to an ounce for those over 21, but for now selling marijuana remains illegal. I-502 gives the state a year to come up with a system of state-licensed growers, processors and retail stores, with the marijuana taxed 25 percent at each stage. Analysts have estimated that a legal pot market could bring Washington hundreds of millions of dollars a year in new tax revenue for schools, health care and basic government functions.
But marijuana remains illegal under federal law. That means federal agents can still arrest people for it, and it's banned from federal properties, including military bases and national parks.
The Justice Department has not said whether it will sue to try to block the regulatory schemes in Washington and Colorado from taking effect.
"The department's responsibility to enforce the Controlled Substances Act remains unchanged," said a statement issued Wednesday by the Seattle U.S. attorney's office. "Neither states nor the executive branch can nullify a statute passed by Congress."
The legal question is whether the establishment of a regulated marijuana market would "frustrate the purpose" of the federal pot prohibition, and many constitutional law scholars say it very likely would.
That leaves the political question of whether the administration wants to try to block the regulatory system, even though it would remain legal to possess up to an ounce of marijuana.
Alison Holcomb is the drug policy director of the American Civil Liberties Union of Washington and served as the campaign manager for New Approach Washington, which led the legalization drive. She said the voters clearly showed they're done with marijuana prohibition.
"New Approach Washington sponsors and the ACLU look forward to working with state and federal officials and to ensure the law is fully and fairly implemented," she said.
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Johnson can be reached at https://twitter.com/GeneAPseattle
Wall Street Week Ahead: "Cliff" worries may drive tax selling
Label: BusinessNEW YORK (Reuters) - Investors typically sell stocks to cut their losses at year end. But worries about the "fiscal cliff" - and the possibility of higher taxes in 2013 - may act as the greatest incentive to sell both winners and losers by December 31.
The $600 billion of automatic tax increases and spending cuts scheduled for the beginning of next year includes higher rates for capital gains, making tax-loss selling even more appealing than usual.
Tax-related selling may be behind the weaker trend in the shares of market leader Apple , analysts said. The stock is down 20 percent for the quarter, but it's still up nearly 32 percent for the year.
Apple dropped 8.9 percent in this past week alone. For a stock that gained more than 25 percent a year for four consecutive years, the embedded capital gains suddenly look like a selling opportunity if one's tax bill is going to jump sharply just because the calendar changes.
"Tax-loss selling is always a factor (but) tax-gains selling has been a factor this year," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.
"You have a lot of high-net-worth individuals in taxable accounts, and that could be what's affecting stocks like Apple. If you look at the stocks that people have their largest gains in, they seem to be under a little bit more pressure here than usual."
Of this year's top 20 performers in the S&P 1500 index, which includes large, small and mid-cap stocks, all but four have lost ground in the last five trading sessions.
The rush to avoid higher taxes on portfolio gains could cause additional weakness.
The S&P 500 ended the week up just 0.1 percent after another week of trading largely tied to fiscal cliff negotiation news, which has pushed the market in both directions.
A PAIN PILL FROM THE FED?
Next week's Federal Reserve meeting could offer some relief if policymakers announce further plans to help the lackluster U.S. economy. The Federal Open Market Committee will meet on Tuesday and Wednesday. The policy statement is expected at about 12:30 p.m. on Wednesday after the conclusion of the meeting - the Fed's last one for the year.
Friday's jobs report showing non-farm payrolls added 146,000 jobs in November eased worries that Superstorm Sandy had hit the labor market hard.
"After the FOMC meeting, I think it's going to be downhill from there as worries about the fiscal cliff really take center stage and prospects of a deal become less and less likely," said Mohannad Aama, managing director of Beam Capital Management LLC in New York.
"I think we are likely to see an escalation in profit-taking ahead of tax rates going up next year," he said.
MORE VOLUME AND VOLATILITY
Volume could increase as investors try to shift positions before year end, some analysts said.
While most of that would be in stocks, some of the extra trading volume could spill over into options, said J.J. Kinahan, TD Ameritrade's chief derivatives strategist.
Volatility could pick up as well, and some of that is already being seen in Apple's stock.
"The actual volatility in Apple has been very high while the market itself has been calm. I expect Apple's volatility to carry over into the market volatility," said Enis Taner, global macro editor at RiskReversal.com, an options trading firm in New York.
Shares of Apple, the largest U.S. company by market value, registered their worst week since May 2010. In another bearish sign, the stock's 50-day moving average fell to $599.52 - below its 200-day moving average at $601.38.
"There's a lot of tax-related selling happening now, and it will continue to happen. Apple is an example, even (though) there are other factors involved with Apple," Aama said.
While investors may be selling stocks to avoid higher taxes in 2013, companies may continue to announce special and accelerated dividend payments before year end. Among the latest, Expedia
To be sure, the big sell-off in stocks following the November 6 election was likely related to tax selling, making it hard to judge how much more is to come.
Bruce Zaro, chief technical strategist at Delta Global Asset Management in Boston, said there's a decent chance that the market could rally before year end.
"Even with little or spotty news that one would put in the positive bucket regarding the (cliff) negotiations, the market has basically hung in there, and I think it's hung in there in anticipation of something coming," he said.
(Wall St Week Ahead runs every Friday. Questions or comments on this column can be emailed to: caroline.valetkevitch(at)thomsonreuters.com)
(Reporting by Caroline Valetkevitch; Editing by Jan Paschal; Multimedia versions of Reuters Top News are now available for:; 3000 Xtra: visit Reuters Top News; BridgeStation: view story .134; For London stock market outlook please click on .L/O; Pan-European stock market outlook .EU/O; Tokyo stock market outlook .T/O; Wall St Week Ahead runs every Friday.)
Morsi Defends Wide Authority in Egypt as Turmoil Rises
Label: World
CAIRO — Egypt descended deeper into political turmoil on Thursday as the embattled president, Mohamed Morsi, blamed an outbreak of violence on a “fifth column” and vowed to proceed with a referendum on an Islamist-backed constitution that has prompted deadly street battles between his supporters and their opponents.
As the tanks and armored vehicles of the elite presidential guard ringed the palace, Mr. Morsi gave a nationally televised address offering only a hint of compromise, while standing firmly by his plan for a Dec. 15 constitutional referendum. His opponents quickly rejected, even mocked, his speech and called for new protests on Friday.
Many said the speech had echoes of his predecessor, Hosni Mubarak, who always saw “hidden hands” behind public unrest. Mr. Morsi said that corrupt beneficiaries of Mr. Mubarak’s autocracy had been “hiring thugs and giving out firearms, and the time has come for them to be punished and penalized by the law.” He added, “It is my duty to defend the homeland.”
Mr. Morsi, a former leader of the Muslim Brotherhood, spoke a day after the growing antagonism between his supporters and the secular opposition had spilled out into the worst outbreak of violence between political factions here since Gamal Abdel Nasser’s coup six decades ago. By the time the fighting ended, six people were dead and hundreds were wounded.
The violence also led to resignations that rocked the government, as advisers, party members and the head of the commission overseeing the planned vote on a new constitution stepped down, citing the bloodshed.
Mr. Morsi also received a phone call from President Obama, who expressed his “deep concern” about the deaths and injuries overnight, the White House said in a statement.
“The president emphasized that all political leaders in Egypt should make clear to their supporters that violence is unacceptable,” the statement said, chastising both Mr. Morsi and the opposition leaders for failing to urge their supporters to pull back during the fight.
Prospects of a political solution also seemed a casualty, as both sides effectively refused to back down on core demands.
The opposition leadership refused to negotiate until Mr. Morsi withdrew a decree that put his judgments beyond judicial review until the referendum — which he refused to do. And it demanded that the referendum be canceled, which he also refused.
The hostilities have threatened to undermine the legitimacy of the constitutional referendum with concerns about political coercion. The feasibility of holding the vote also appears uncertain amid attacks on Brotherhood offices around the country and open street fighting in the shadow of the presidential palace.
Though Mr. Morsi spoke of opening a door for dialogue and compromise, leaders of the political opposition and the thousands of protesters surrounding his palace dismissed his conspiratorial saber rattling as an echo of Mr. Mubarak. And his tone, after a night many here view as a national tragedy, seemed only to widen the gulf between his Islamist supporters and their secular opponents over his efforts to push through the referendum on an Islamist-backed charter approved over the objections of other factions and the Coptic Christian church.
Outside the palace, demonstrators huddled around car radios to listen to Mr. Morsi’s words and mocked his attempts to blame outside infiltrators for the violence, which began when thousands of his Islamist supporters rousted an opposition sit-in.
“So we are the ones who attacked him, the ones who attacked the sit-in?” one protester asked sarcastically. “So we are the ones with the swords and weapons and money?” asked another.
Some left for the headquarters of the Muslim Brotherhood, where a mob had broken in, looted offices, and made a bonfire out of the belongings of the group’s spiritual leader — until riot police officers chased them away with tear gas.
“I never thought I would say this, but even Mubarak was more savvy when he spoke in a time of crisis,” said Hossam Bahgat, executive director of the Egyptian Initiative for Personal Rights.
The X Factor Reveals Its Four Semi-Finalists
Label: Lifestyle
TV Watch
The X Factor
There were tears on The X Factor Thursday night.
With only four spots in next week's semi-finals, the six acts who performed two songs each Wednesday night were a tense bunch. Especially after last week's shocking elimination that sent home fan favorite Vino Alan.
A majority of PEOPLE.com readers picked Demi Lovato's only remaining contestant, CeCe Frey, as the singer who most deserved elimination. Was she able to make it through one more week? Keep reading for all the results ...
CeCe Frey was the first to go.
"I'm proud of everything that I've done on this show," she said. "I hope I've taught everyone at home that you need to love who you are, because the more you love who you are, the less you're going to need anybody else to."
Her coach tried to avoid tears but shed a few anyway. "I've grown so close to you," Demi said. "And I'm just so proud of you."
Three acts were then declare safe: Simon Cowell's boy band, Emblem3; Britney Spears's frontrunner, Carly Rose Sonenclar; and L.A. Reid's country singer, Tate Stevens, also a frontrunner.
That left Team Britney's Diamond White and Simon's other group, Fifth Harmony, to sing for survival.
Fifth Harmony sang Mariah Carey's "Anytime You Need a Friend," and Diamond sang Lee Ann Womack's "I Hope You Dance."
As expected, Simon and Britney voted to send home each other's acts. But it was the end of the road for Diamond, after L.A. and Demi both voted to send her home as well.
"I'm just thinking of Cher Lloyd right now," she said of the "Want U Back" singer. "She came in fifth and look where she is."
Here's how the top four ranked:
1. Tate Stevens
2. Carly Rose Sonenclar
3. Emblem3
4. Fifth Harmony
Asia shares at 2012 high, markets await U.S. jobs data
Label: BusinessTOKYO (Reuters) - Asian shares touched fresh 16-month highs on Friday as investors awaited U.S. nonfarm payrolls data due later in the day, with sentiment underpinned by signs that China's economy is stabilizing.
European shares will likely gain modestly, with financial spreadbetters predicting London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> to open as much as 0.4 percent higher. A 0.1 percent rise in U.S. stock futures hinted at a steady Wall Street open. <.l><.eu><.n/>
MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> rose 0.5 percent, and was set for its third-straight weekly gain with a 1.3 percent advance. The index has gained about 17 percent year-to-date, compared to a loss of nearly 18 percent last year.
Hong Kong shares <.hsi> reached a 16-month peak and have climbed some 21 percent so far this year despite facing bouts of pressure from sputtering mainland Chinese markets. Shanghai shares <.ssec> jumped 1.2 percent.
"People were gloomier at this time last year, but now, judging from the flows, they seem to be very optimistic and positioning for policy changes next year in China," said Larry Jiang, chief investment strategist at Guotai Junan International Securities.
Australian shares <.axjo> rose 0.9 percent to a six-week closing high, with top miners supported by rebounding iron ore prices.
Investors will focus on a slew of Chinese data due over the weekend including industrial output, after recent manufacturing surveys pointed to a recovery from lows earlier this year.
"One of the reasons for the gains is better news we've seen from China and expectations the economy there has stabilized and growth has improved modestly," said Michael McCarthy, chief market strategist at CMC Markets.
Despite some positive signs in the world's second-largest economy, the Asian Development Bank slightly cut its 2012 and 2013 growth estimates for developing Asia on Friday as frail global demand continues to drag on the region.
Buoyed by strong domestic consumption and government spending, developing Asian economies have shown relatively more resilience compared with developed and more export-reliant economies such as Japan and south Korea.
South and Southeast Asian bourses have outperformed, with a 32 percent year-to-date surge in the Philippines <.psi>, a 30 percent gain in Thailand <.seti>, Indian shares <.bsesn> rising 26 percent and Indonesia <.jkse> up 12 percent to date.
Japan's Nikkei stock average <.n225> was barely changed, hovering near seven-month highs hit on Thursday. <.t/>
The dollar traded at 82.47 yen, sticking close to a 7-1/2-month high of 82.84 hit on November 22.
U.S. HOPES
As superstorm Sandy disrupted U.S. economic activity, nonfarm payrolls in November are expected to have increased only 93,000, compared to October's 171,000 job gain, a Reuters survey of economists showed. The unemployment rate is seen holding steady at 7.9 percent.
"A soft number should reinforce the case for the Fed doves ahead of next week's FOMC meeting where QE is likely to be increased in order to at least offset the expiration of Operation Twist. Hence a soft report should hurt USD and vice versa," Sean Callow, senior currency strategist at Westpac bank in Sydney, said in a note.
At its December 11-12 meeting, the Federal Reserve is expected to announce a new round of Treasury bond purchases to reinforce quantitative easing, replacing the expiring programme called Operation Twist, under which it bought $45 billion of longer-dated bonds a month while selling its shorter-date holdings.
With little to show after a month of posturing, the White House and Republicans in Congress dropped hints on Thursday that they had resumed low-level private talks on breaking the stalemate over the "fiscal cliff.
Markets have been keeping up hope that Washington would eventually avert some $600 billion of tax hikes and spending cuts scheduled to start in January. Economists have warned that if Congress failed to reach an agreement, the U.S. economy could slip back into recession, further weighing on the fragile global economy.
EURO ON DEFENSIVE
The euro steadied at around $1.2968. The euro slid nearly 1 percent to a one-week low of $1.2950 on Thursday in its biggest one-day loss in a month on prospects for interest rate cuts next year.
European Central Bank President Mario Draghi said on Thursday policymakers had held a wide discussion on interest rates, including negative deposit rates, which means effectively charging depositors rather than paying them interest, with an aim of forcing banks to put their money to work elsewhere.
The ECB also projected gross domestic product next year could range from a contraction of 0.9 percent to growth of 0.3 percent, suggesting contraction is far more likely than not.
"It is unusual that a negative growth projection for the next year is offered before the end of the current year, but with such a view, markets are naturally pricing in a interest rate cut," said Daisuke Karakama, market economist for Mizuho Corporate Bank in Tokyo.
He expected the euro to remain vulnerable with the risk of falling back to $1.2 at some point, but the single currency appeared to be supported currently by year-end repatriation flows.
U.S. crude futures inched up 0.4 percent to $86.58 a barrel and Brent rose 0.2 percent to $107.29.
A firm tone in broad assets soothed sentiment for Asian credit markets, narrowing the spreads on the iTraxx Asia ex-Japan investment-grade index by 2 basis points.
(Additional reporting by Clement Tan and Vikram Subhedar in Hong Kong and Maggie Lu Yueyang; Editing by Kim Coghill)
IHT Rendezvous: Typhoon Bopha: Hurricane Sandy Times Two
Label: WorldHONG KONG — The official death toll from Typhoon Bopha climbed to 325 by Thursday afternoon, and with nearly 400 Filipinos still unaccounted for, the typhoon appeared as if it would be twice as deadly as Hurricane Sandy, the storm that thrashed the Caribbean and the eastern United States six weeks ago.
Sandy killed at least 253 people, including 132 in the United States. President Obama is expected to ask Congress this week for about $50 billion to help states in their post-Sandy recovery efforts.
Typhoon Bopha, known as Pablo in the Philippines, arrived on Tuesday, packing winds up to 100 miles per hour. It washed away entire villages and hamlets; wiped out roads and bridges; flattened cornfields and banana plantations; wrecked fishing fleets; and buried homes under landslides and walls of mud.
In some towns, dead bodies were gathered together in rows, their faces covered by tarpaulins, sodden blankets or palm fronds.
“Bodies of victims were laid on the ground for viewing by people searching for missing relatives,” The Associated Press reported. “Some were badly mangled after being dragged by raging floodwaters over rocks and other debris. A man sprayed insecticide on the remains to keep away swarms of flies.”
In one village, the mud-caked body of a child lay under a sheet with a note attached. It read: “4 yrs. old, male.”
One survivor, Julius Julian Rebucas, told Reuters that his mother and brother had been swept away in a flash flood. “I no longer have a family,” he said.
He can be seen being carried to an ambulance in a BBC video here.
Bopha struck most heavily in the southern Philippines, which typically dodges the 20 or so typhoons that slam the country every year. My colleague Floyd Whaley spoke to a military official who said most of the fatalities were in the province of Compostela Valley, a mountainous gold mining area, and the adjoining province of Davao Oriental.
The Philippine news site Rappler had a live blog going, tracking the progress of the storm and giving government information on deaths, damage and where people could donate food or supplies.
The national weather agency of the Philippines was sending regular updates on its Twitter feed here. Its Web site is located here.
Twitter also assembled the addresses of accounts offering information on relief efforts, and the service recommended using the hashtag #pabloPH for storm-related tweets and searches.
A New York Times slide show of the storm’s aftermath is here.
When floods hit Manila in the summer, a quarter-million people in the capital were made homeless. But as we reported on Rendezvous, “on social media outlets like Facebook and Twitter, and through text messages, Filipinos demonstrated a remarkable civic spirit as they shared news of evacuation centers and dropoff points for donations of emergency supplies.
“They praised rescue teams, and they encouraged each other. They pleaded for calm — and there were few reported signs of panic, even from those who were stranded. And they prayed.”
Gwen Garcia, the governor of the Philippine province of Cebu, endorsed practical preparations — and prayer — in a tweet on Tuesday:
In his article, Floyd also noted that “last December, Tropical Storm Washi — another out-of-season storm that hit south of the usual Philippine typhoon belt — killed more than 1,200 people and left hundreds of thousands homeless.
“This year, officials put out strong warnings days in advance and carried out mandatory early evacuations of vulnerable communities.”
Apple’s shares swallow biggest loss in four years
Label: TechnologyNEW YORK/SAN FRANCISCO (Reuters) – Apple Inc shares tumbled more than 6 percent on Wednesday, chalking up their biggest single-day loss in four years as fears grow about intensifying competition in the mobile device market.
Investors and analysts blamed the sell-off on a mix of factors, including a forecast by an influential research firm that the iPad maker is continuing to cede ground to rival Google Inc’s Android gadgets, and unconfirmed reports that at least one major stock-clearing house was raising margin requirements on Apple stock trades.
Analysts also cited fears about a hike in the capital gains tax in 2013 in the event that ongoing Washington fiscal negotiations fail, as well as news that Nokia had beat Apple to the punch by striking a deal to sell its flagship Lumia through China Mobile, that country’s largest wireless carrier.
Wednesday’s drop rounded off a bleak 10 weeks for the most valuable U.S. company.
The stock was one of the day’s biggest percentage losers on the S&P 500, shedding $ 35 billion of market value as more than 37 million shares changed hands — blowing past the company’s average daily volume over 50 days of 21 million.
Apple‘s shares, once among the most desirable of portfolio holdings, have headed steadily lower since September on growing uncertainty about the company’s ability to fend off unprecedented competition. This year saw a surge in sales of Amazon.com Inc’s cheaper Kindle Fire and Microsoft Corp’s first foray into the tablet market with its Surface.
Meanwhile, Samsung Electronics continues to chip away at the iPad‘s dominance with its Galaxy line.
The assault on Apple‘s consumer-electronics home turf presents a stiff challenge for CEO Tim Cook, who was elevated shortly before the death of Silicon Valley legend Steve Jobs and is now charged with keeping the world’s largest technology company humming.
“This is not going to be a short-term trend. This is a management test, of how well they can perform without Steve Jobs,” said Brian Battle, director of trading at Performance Trust Capital Partners in Chicago. Referring to Apple‘s new iPad mini, which is only a smaller version of the existing iPad, Battle said the company needs “another home run” for shares to return to levels around $ 700.
“They need another new product that hits it out of the park. Without that, they could get a gradual grind-down in confidence,” he said.
On Wednesday, research firm International Data Corp said Apple most likely shed market share in the tablet computer space in 2012. Its worldwide tablet market share will slip to 53.8 percent in 2012 from 56.3 percent in 2011, while Android products would increase their share to 42.7 percent from 39.8 percent, IDC said.
Concerns that tax rates on dividends and capital gains may rise next year were also cited as contributing to the Apple sell-off.
The stock’s massive market value meant Apple was almost single-handedly responsible for Wednesday’s 1.1 percent decline in the Nasdaq 100 Index.
Apple is still up 33 percent this year, but is down nearly 24 percent from its record high of $ 705.07, hit on September 21. The stock slid more than 6.4 percent on Wednesday to close at $ 538.7923.
BEFUDDLING SLIDE
Some analysts were perplexed at the fall from favor in Apple stock, which has been a staple in almost all growth portfolios. The company is expected to deliver reliably high revenue and earnings expansion for years to come, and one in two tablets sold globally remains an iPad.
It is now gearing up for the introduction of its latest iPhone 5 and iPad mini in international markets. It will begin selling the iPhone 5 in 50 countries in December, including China and South Korea.
“Apple stock is significantly more volatile than its earnings and innovation stream,” said Daniel Ernst, analyst with Hudson Square Research. “And yet the wind blows slightly from the south instead of the east one particular morning, and the stock is down 6 percent.”
“It makes no sense. There are lines around the block for their products all around the world,” he added. “No other company has that.”
Separately, Nokia said it will partner with China Mobile, in a sales deal that will give the Finnish company an opportunity to win back Chinese market share from Apple‘s iPhone.
But some analysts continue to believe the dominant carrier in the world’s largest cellular market will eventually embrace the iPhone as well.
“China Mobile already carries multiple smartphones from multiple vendors. We continue to expect China Mobile to add the iPhone in the back half of 2013,” Piper Jaffray’s Gene Munster wrote in a research note.
While lines for the latest iPad model appeared lighter than usual when it hit stores in November, Apple said at the time that demand was so strong that it “practically sold out of iPad minis.” It sold 3 million of the new iPads — including the full-sized version — in the first three days on the market.
Some analysts suggested that investors also sold shares of Apple amid uncertainty over ongoing fiscal negotiations in Washington. If no agreement is reached on the issue, higher tax rates on dividends and capital gains are possible in 2013.
Investors who had hoped for a special dividend this year, as many other corporations have announced on expectations of higher tax rates next year, may be disappointed as time is running out.
“If you were expecting a special dividend by year end, that’s less likely to happen because its December 5,” said Colin Gillis, an analyst with BGC Partners.
The fear of higher taxes on capital gains also has prompted some investors to lock in profits now, particularly on a stock like Apple, which has posted gains of at least 25 percent for four consecutive years.
“Depending on what happens with the (U.S. fiscal negotiations), rates could rise next year or they could stay the same,” said Battle, of Performance Trust Capital. “They will not be lower, so if you’re an investor who has seen gains in Apple, it is better to take those gains this year rather than next.”
Tax selling “can take a life of its own,” said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
“Some taxable investors take the gains, that creates some negative momentum, institutional investors are heavily weighted the stock and reduce exposure.”
Some market participants also cited reports by media including CNBC, which Reuters could not confirm, that margin requirements on the trading of Apple stock had been raised by at least one clearing firm.
(Additional reporting by Charles Mikolajczak in New York and Doris Frankel in Chicago; Editing by Bernadette Baum, Andrew Hay, Leslie Adler and Ken Wills)
Gadgets News Headlines – Yahoo! News
Frank Ocean, Taylor Swift Collect Grammy Nominations
Label: LifestyleHow FUN!
The Grammys handed out their nominations Wednesday night at a concert in Nashville and there was a decidedly youthful feel: Taylor Swift earned a nod for record of the year and the band FUN joined Frank Ocean with the trifecta of album and record of the year and best new artist.
In the country categories, Blake Shelton is up against Carrie Underwood for best solo performance and Miranda Lambert was nominated for best album.
Here are some of the major nominations. For a complete list go to Grammy.com:
Album of the Year:
El Camino – The Black Keys
Some Nights– FUN.
Babel – Mumford & Sons
Channel Orange – Frank Ocean
Blunderbuss – Jack White
Record of the Year:
Lonely Boy – The Black Keys
Stronger (What Doesn't Kill You) – Kelly Clarkson
We Are Young – FUN. featuring Janelle Monáe
Somebody That I Used To Know – Gotye Featuring Kimbra
Thinkin Bout You – Frank Ocean
We Are Never Ever Getting Back Together – Taylor Swift
Best New Artist:
Alabama Shakes
FUN
Hunter Hayes
The Lumineers
Frank Ocean
Song Of The Year:
"The A Team" – Ed Sheeran, songwriter (Ed Sheeran)
"Adorn" – Miguel Pimentel, songwriter (Miguel)
"Call Me Maybe" – Tavish Crowe, Carly Rae Jepsen & Josh Ramsay, songwriters (Carly Rae Jepsen)
"Stronger (What Doesn't Kill You)" – Jörgen Elofsson, David Gamson, Greg Kurstin & Ali Tamposi, songwriters (Kelly Clarkson)
"We Are Young" – Jack Antonoff, Jeff Bhasker, Andrew Dost & Nate Ruess, songwriters (FUN. featuring Janelle Monáe)
Best Country Solo Performance:
"Home" – Dierks Bentley
"Springsteen" – Eric Church
"Cost Of Livin'" – Ronnie Dunn
"Wanted" – Hunter Hayes
"Over" – Blake Shelton
"Blown Away" – Carrie Underwood
Best Country Album:
Uncaged – Zac Brown Band
Hunter Hayes – Hunter Hayes
Living For A Song: A Tribute To Hank Cochran – Jamey Johnson
Four The Record– Miranda Lambert
The Time Jumpers – The Time Jumpers
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