U.S. evolves on same-sex marriage

STORY HIGHLIGHTS

• The president and the nation have shifted perspectives on same-sex marriage


• Supreme Court ruling on California's same-sex marriage ban a critical test


• Growing public support for gay marriage give proponents hope for change

Washington (CNN) -- The nation's growing acceptance of same-sex marriage has happened in slow and painstaking moves, eventually building into a momentum that is sweeping even the most unlikely of converts.

Even though he said in 2008 that he could only support civil unions for same-sex couples, President Barack Obama nonetheless enjoyed strong support among the gay community. He disappointed many with his conspicuously subdued first-term response to the same-sex marriage debate.

Last year, after Vice President Joe Biden announced his support, the president then said his position had evolved and he, too, supported same-sex marriage.

So it was no small matter when on Thursday the Obama administration formally expressed its support of same-sex marriage in a court brief weighing in on California's Proposition 8, which bans same-sex weddings. The administration's effort was matched by at least 100 high-profile Republicans — some of whom in elections past depended on gay marriage as a wedge issue guaranteed to rally the base — who signed onto a brief supporting gay couples to legally wed.

Obama on same-sex marriage: Everyone is equal

Then there are the polls that show that an increasing number of Americans now support same-sex marriage. These polls show that nearly half of the nation's Catholics and white, mainstream Protestants and more than half of the nation's women, liberals and political moderates all support same-sex marriage.

According to Pew Research Center polling, 48% of Americans support same-sex marriage with 43% opposed. Back in 2001, 57% opposed same-sex marriage while 35% supported it.

In last year's presidential election, same-sex marriage scarcely raised a ripple. That sea change is not lost on the president.

"The same evolution I've gone through is the same evolution the country as a whole has gone through," Obama told reporters on Friday.

Craig Rimmerman, professor of public policy and political science at Hobart and William Smith colleges says there is history at work here and the administration is wise to get on the right side.

"There is no doubt that President Obama's shifting position on Proposition 8 and same-sex marriage more broadly is due to his desire to situate himself on the right side of history with respect to the fight over same-sex marriage," said Rimmerman, author of "From Identity to Politics: The Lesbian and Gay Movements in the United States."

"I also think that broader changes in public opinion showing greater support for same-sex marriage, especially among young people, but in the country at large as well, has created a cultural context for Obama to alter his views."

For years, Obama had frustrated many in the gay community by not offering full-throated support of same-sex marriage. However, the president's revelation last year that conversations with his daughters and friends led him to change his mind gave many in that community hope.

Last year, the Obama administration criticized a measure in North Carolina that banned same-sex marriage and made civil unions illegal. The president took the same position on a similar Minnesota proposal.

Obama administration officials point to what they see as the administration's biggest accomplishment in the gay rights cause: repealing "don't ask, don't tell," the military's ban on openly gay and lesbian members serving in the forces.

Then there was the president's inaugural address which placed the gay community's struggle for equality alongside similar civil rights fights by women and African-Americans.

"Our journey is not complete until our gay brothers and sisters are treated like anyone else under the law, for if we are truly created equal, then surely the love we commit to one another must be equal, as well," Obama said in his address after being sworn in.

In offering its support and asserting in the brief that "prejudice may not be the basis for differential treatment under the law," the Obama administration is setting up a high stakes political and constitutional showdown at the U.S. Supreme Court over a fast-evolving and contentious issue.

The justices will hear California's Proposition 8 case in March. That case and another appeal over the federal Defense of Marriage Act will produce blockbuster rulings from the justices in coming months.

Beyond the legal wranglings there is a strong social and historic component, one that has helped open the way for the administration to push what could prove to be a social issue that defines Obama's second term legacy, Rimmerman said.

The nation is redefining itself on this issue, as well.

Pew survey: Changing attitudes on gay marriage

The changes are due, in part, to generational shifts. Younger people show a higher level of support than their older peers, according to Pew polling "Millennials are almost twice as likely as the Silent Generation to support same-sex marriage."

"As people have grown up with people having the right to marry the generational momentum has been very, very strong," said Evan Wolfson, president of Freedom to Marry, a gay rights organization.

That is not to say that there isn't still opposition.

Pew polling found that most Republicans and conservatives remain opposed to same-sex marriage. In 2001, 21% of Republicans were supportive; in 2012 that number nudged slightly to 25%.

Conservative groups expressed dismay at the administration's same-sex marriage support.

"President Obama, who was against same-sex 'marriage' before he was for it, and his administration, which said the Defense of Marriage Act was constitutional before they said it was unconstitutional, has now flip-flopped again on the issue of same-sex 'marriage,' putting allegiance to extreme liberal social policies ahead of constitutional principle," Family Research Council President Tony Perkins said in a statement.

But there are signs of movement even among some high profile Republican leaders

Top Republicans sign brief supporting same-sex marriage

The Republican-penned friend of the court brief, which is designed to influence conservative justices on the high court, includes a number of top officials from the George W. Bush administration, Mitt Romney's former campaign manager and former GOP presidential candidate Jon Huntsman.

It is also at odds with the Republican Party's platform, which opposes same-sex marriage and defines marriage as a union between a man and a woman.

Still, with White House and high-profile Republican support, legal and legislative victories in a number of states and polls that show an increasing number of Americans support same sex-marriage, proponents feel that the winds of history are with them.

"What we've seen is accelerating and irrefutable momentum as Americans have come to understand who gay people are and why marriage matters," Wolfson said. "We now have a solid national majority and growing support across every demographic. We have leaders across the spectrum, including Republicans, all saying it's time to end marriage discrimination."

CNN's Peter Hamby, Ashley Killough and Bill Mears contributed to this report.

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Blackhawks' streak at 21 with overtime win over Blue Jackets

Chalk one up for the "slug defenseman."

Brent Seabrook's goal in overtime kept the Blackhawks' record-breaking streak alive as they edged the Blue Jackets 4-3 Friday night at the United Center to remain without a regulation loss this season. At 18-0-3, the Hawks keep piling up the points, securing 39 of a possible 42 this season.

Friday night's hero — with a little help from his friends — was Seabrook, who took a pass from Jonathan Toews 3 minutes, 23 seconds into overtime and beat Blue Jackets goaltender Steve Mason for the game-winner.

"(Toews) is good — he's a hell of a player," Seabrook said, giving credit to his captain. "He usually likes to shoot low and I think Mason was probably thinking he was going to shoot it. (Toews) had a slug defenseman (in me) going down on the off side so he made a great pass. I don't think the Blue Jackets defenseman, Mason or I expected it to come. Somehow he saw me and made a great pass.

"He didn't look at me once and I didn't yell. He's pretty good in those situations so I just let him do his thing. I don't think I shot the puck, it was such a hard pass it hit my stick and just bounced in."

Against a banged up and usually bumbling Blue Jackets squad, the Hawks increased their points streak over the course of two seasons to 27 consecutive games — third-longest in NHL history.

Viktor Stalberg, Patrick Sharp and Bryan Bickell had goals in regulation and Ray Emery earned the victory in net for the Hawks.

Vinny Prospal, Artem Anisimov and Ryan Johansen scored for the Blue Jackets but it wasn't enough. The Blue Jackets, who entered the game with the fewest points in the league, were without defensemen James Wisniewski, Jack Johnson and John Moore and forwards Derick Brassard and Brandon Dubinsky but fought gamely.

A night after the Hawks opened their victory over the Blues with a Toews goal just 10 seconds into the game, the Blue Jackets struck quickly when Prospal jumped on a big rebound Emery yielded off a Derek Dorsett shot and fired it into the open net with 31 seconds elapsed.

Stalberg later continued his mastery over the Blue Jackets with his 11th goal in his 15th game against them when the winger tapped in a puck in the crease during a scramble.

"We're finding ways to really get it done," Stalberg said. "It's pretty amazing to be a part of a run like this. It seems like it hasn't gotten to our heads at all. We're staying with it … and that's all we can do right now."

The Jackets kept coming and took the lead when Anisimov's shot from the point deflected off the Hawks' Daniel Carcillo and bounded past Emery.

Late in the second, the Hawks' offense kicked into gear. Sharp evened the score at 2-2 when his backhander from the left circle somehow made it through Mason's pads and trickled across the goal line.

Bickell's splendid individual effort put the Hawks ahead just less than a minute later. The winger stripped Anisimov of the puck, skated in two-on-one with Stalberg and rifled a wrist shot from the left dot past Mason to the stick side.

After Johansen tied it midway through the third, the goalies held and the game went to overtime where Toews and Seabrook won it.

"(The Blue Jackets are) a hard-working team," Seabrook said. "They play 60 minutes hard and you have to come to play this team hard every time. There are no easy games in this league and you never can take a night off. I thought we fought hard on the second part of a back-to-back and it was good to get the win."

ckuc@tribune.com

Twitter @ChrisKuc

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Asian shares capped by China PMI slip, U.S. budget worry

TOKYO (Reuters) - Asian shares were capped on Friday, with sentiment dented by lackluster manufacturing data from China and worries over the economic fallout from Italy's political confusion as well as possible U.S. spending cuts.

European markets are seen narrowly mixed, with financial spreadbetters predicting London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> would open between a 0.1 percent rise and a 0.2 percent fall. Italy's main FTSE MIB <.ftmib> stock market index is expected to open down 0.2 percent. <.l><.eu/>

A 0.1 percent drop in U.S. stock futures also hinted at a weak Wall Street start. <.n/>

But losses were limited by renewed confidence that major central banks will keep taking stimulative steps to support their economies.

China's factory growth cooled in February to multi-month lows after domestic demand dipped to weigh on firms already hit by slack foreign sales, two surveys showed on Friday, underlining the country's patchy economic recovery. But it does not signal China's economy is slipping into another slowdown, analysts said.

China's February official purchasing managers' index (PMI) came in at 50.1, slightly below a 50.2 Reuters poll consensus and the 50.4 posted in January. A private survey showed the final HSBC PMI fell to 50.4 after seasonal adjustments from January's two-year high of 52.3, in line with a flash reading.

"While comfort can be sought from the fact that the Chinese economy remains in expansion territory, the dip from prior PMI readings does illustrate that the recovery is far from linear and that there are still a few bumps in the road," said Tim Waterer, senior trader at Sydney-based CMC Markets.

The MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> was down 0.1 percent, after ending February up 0.5 percent, showing muted reaction to Chinese data.

Australian shares <.axjo> slipped 0.4 percent, pulling back from 4-1/2-year highs touched in the previous session, as big miners lost ground on lower metal prices. South Korean markets were closed on Friday for a public holiday.

The Australian dollar, which is sensitive to data from China, Australia's largest trading partner, was up 0.2 percent to $1.0230.

Japan's Nikkei stock average <.n225> erased earlier losses to rise 0.5 percent, lifted by expectations for strong reflationary measures from the Bank of Japan in coming months. <.t/>

Stocks in Indonesia edged higher to a fresh record. Data showed Indonesia's trade deficit narrowed slightly in January from the previous month as exports posted their smallest fall in nearly a year, reflecting recovering global demand and providing early hope that the nation's external balances may improve in 2013.

From Japan, Friday's data showed Japanese companies cut spending on plant and equipment in October-December by 8.7 percent from the same period last year, down for the first time in five quarters amid a slump in exports, showing the world's third-largest economy was still struggling to find a solid footing.

In contrast, a drop in new U.S. claims for jobless benefits last week and a sharp rise in factory activity in the Midwest in February suggested the U.S. economy is improving.

The relative outperformance of the world's leading economy over Japan's may soon turn the Japan-based yen selling into U.S.-led dollar buying, giving a fresh push higher in the dollar/yen, traders say.

The dollar inched up 0.1 percent to 92.65 against the yen.

One factor that could cloud such a positive outlook is the uncertainty over the possible extent of economic damage from the $85 billion in automatic across-the-board "sequestration" spending cuts in the United States set to begin taking effect on Friday.

"Financial markets are eerily calm about the issue. Nobody is talking about the sequestration, and I worry about the seeming lack of interest when market sentiment is far from stable after sharp swings following the Italian election," said Hiroshi Maeba, head of FX trading Japan at UBS in Tokyo.

He said reaction, if any, will likely come in equities and bonds first and spill over to forex, hitting risk-sensitive currencies which may possibly underpin the dollar.

The International Monetary Fund said on Thursday it would likely cut its 2013 growth forecasts for the United States by at least a 0.5 percentage point if the cuts are fully implemented. The IMF now projects that the U.S. economy will grow 2 percent this year.

"The $85 billion in spending cuts is simply too small to make much of a difference to the economy and although it could cause some problems, it will have no bearing on influencing investor allocations among different asset classes," said Ed Meir, an analyst at INTL FCStone, in a note.

U.S. crude fell 0.1 percent to $91.93 a barrel, after earlier hitting a 2013 low of $91.43. Brent crude fell 0.3 percent to $111.05 after falling to a six-week low of $110.86 earlier. Oil prices were weighed by concerns about the global economy and the strength of demand.

Spot gold inched down 0.1 percent to $1,578.81 an ounce after dropping more than 1 percent on Thursday and ending February with its fifth straight monthly drop, the longest string of monthly declines since 1996.

The euro was up 0.1 percent to $1.3074, but near a seven-week trough of $1.3018 plumbed earlier in the week.

(Additional reporting by Luke Pachymuthu and Rujun Shen in Singapore; Editing by Eric Meijer)

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Why Syria war is everybody's problem

Syrians search for survivors and bodies after the Syrian regime attacked the city of Aleppo with missiles on February 23.

STORY HIGHLIGHTS

• Frida Ghitis: We are standing by as Syria rips itself apart, thinking it's not our problem


• Beyond the tragedy in human terms, she says, the war damages global stability


• Ghitis: Syria getting more and more radical, jeopardizing forces of democracy


• Ghitis: Peace counts on moderates, whom we must back with diplomacy, training arms

Editor's note: Frida Ghitis is a world affairs columnist for The Miami Herald and World Politics Review. A former CNN producer and correspondent, she is the author of "The End of Revolution: A Changing World in the Age of Live Television." Follow her on Twitter: @FridaGColumns

(CNN) -- Last week, a huge explosion rocked the Syrian capital of Damascus, killing more than 50 people and injuring hundreds. The victims of the blast in a busy downtown street were mostly civilians, including schoolchildren. Each side in the Syrian civil war blamed the other.

In the northern city of Aleppo, about 58 people -- 36 of them children -- died in a missile attack last week. Washington condemned the regime of Bashar al-Assad; the world looked at the awful images and moved on.

Syria is ripping itself to pieces. The extent of human suffering is beyond comprehension. That alone should be reason enough to encourage a determined effort to bring this conflict to a quick resolution. But if humanitarian reasons were not enough, the international community -- including the U.S. and its allies -- should weigh the potential implications of allowing this calamity to continue.

Frida Ghitis

We've all heard the argument: It's not our problem. We're not the world's policeman. We would only make it worse.

This is not a plea to send American or European troops to fight in this conflict. Nobody wants that.

But before we allow this mostly hands-off approach to continue, we would do well to consider the potential toll of continuing with a failed policy, one that has focused in vain over the past two years searching for a diplomatic solution.

U. S. Secretary of State John Kerry has just announced that the U.S. will provide an additional $60 million in non-lethal assistance to the opposition. He has hinted that President Obama, after rejecting suggestions from the CIA and previous Secretary of State Hillary Clinton to arm Syrian rebels, might be ready to change course. And not a day too soon.

The war is taking longer than anyone expected. The longer it lasts, the more Syria is radicalized and the region is destabilized.

If you think the Syrian war is the concern of Syrians alone, think about other countries that have torn themselves apart over a long time. Consider Lebanon, Afghanistan or Somalia; each with unique circumstances, but with one thing in common: Their wars created enormous suffering at home, and the destructiveness eventually spilled beyond their borders. All of those wars triggered lengthy, costly refugee crises. They all spawned international terrorism and eventually direct international -- including U.S. -- intervention.

The uprising against al-Assad started two years ago in the spirit of what was then referred to -- without a hint of irony -- as the Arab Spring. Young Syrians marched, chanting for freedom and democracy. The ideals of equality, rule of law and human rights wafted in the air.

Al-Assad responded to peaceful protests with gunfire. Syrians started dying by the hundreds each day. Gradually the nonviolent protesters started fighting back. Members of the Syrian army started defecting.

The opposition's Free Syrian Army came together. Factions within the Syrian opposition took up arms and the political contest became a brutal civil war. The death toll has climbed to as many as 90,000, according to Kerry. About 2 million people have left their homes, and the killing continues with no end in sight.

In fairness to Washington, Europe and the rest of the international community, there were never easy choices in this war. Opposition leaders bickered, and their clashing views scared away would-be supporters. Western nations rejected the idea of arming the opposition, saying Syria already has too many weapons. They were also concerned about who would control the weaponry, including an existing arsenal of chemical and biological weapons, after al-Assad's fall.

These are all legitimate concerns. But inaction is producing the worst possible outcome.

The moderates, whose views most closely align with the West, are losing out to the better-armed Islamists and, especially, to the extremists. Moderates are losing the ideological debate and the battle for the future character of a Syria after al-Assad.

Radical Islamist groups have taken the lead. Young people are losing faith in moderation, lured by disciplined, devout extremists. Reporters on the ground have seen young democracy advocates turn into fervent supporters of dangerous groups such as the Nusra Front, which has scored impressive victories.

The U.S. State Department recently listed the Nusra Front, which has close ties to al Qaeda in Iraq and a strong anti-Western ideology, as a terrorist organization.

Meantime, countries bordering Syria are experiencing repercussions. And these are likely to become more dangerous.

Jordan, an important American ally, is struggling with a flood of refugees, as many as 10,000 each week since the start of the year. The government estimates 380,000 Syrians are in Jordan, a country whose government is under pressure from its own restive population and still dealing with huge refugee populations from other wars.

Turkey is also burdened with hundreds of thousands of refugees and occasional Syrian fire. Israel has warned about chemical weapons transfers from al-Assad to Hezbollah in Lebanon and may have already fired on a Syrian convoy attempting the move.

Lebanon, always perched precariously on the edge of crisis, lives with growing fears that Syria's war will enter its borders. Despite denials, there is evidence that Lebanon's Hezbollah, a close ally of al-Assad and of Iran, has joined the fighting on the side of the Syrian president. The Free Syrian Army has threatened to attack Hezbollah in Lebanon if it doesn't leave Syria.

The possible outcomes in Syria include the emergence of a failed state, stirring unrest throughout the region. If al-Assad wins, Syria will become an even more repressive country.

Al-Assad's survival would fortify Iran and Hezbollah and other anti-Western forces. If the extremists inside the opposition win, Syria could see factional fighting for many years, followed by anti-democratic, anti-Western policies.

The only good outcome is victory for the opposition's moderate forces. They may not be easy to identify with complete certainty. But to the extent that it is possible, these forces need Western support.

They need training, funding, careful arming and strong political and diplomatic backing. The people of Syria should know that support for human rights, democracy and pluralism will lead toward a peaceful, prosperous future.

Democratic nations should not avert their eyes from the killings in Syria which are, after all, a warning to the world.

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of Frida Ghitis.

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Crawford injured as Blackhawks extend streak to 20

ST. LOUIS — A little adversity never hurt anyone. Especially the surging Blackhawks.

Though their starting goaltender wasn't around to see it, the Hawks continued their assault on the NHL record book with a 3-0 victory over the Blues on Thursday night at the Scottrade Center.

Goalie Corey Crawford made it through the first period but didn't come out for the second after suffering an upper-body injury. That didn't slow the Hawks as they rode backup Ray Emery to extend their streak to 20 games to start the season without a loss in regulation and 26 in a row overall dating to 2011-12.

"We have thick skin," said captain Jonathan Toews, who scored two goals — including one 12 seconds into the game off a terrific passing play from Duncan Keith to Marian Hossa to Brandon Saad and finally to Toews — to help the Hawks improve to 17-0-3. "Whether there's momentum going against us or a call we didn't like or any sort of adversity that might get in our way, we've always been positive and stuck with it. We've been hungry and determined to win every single game."

Andrew Shaw also had a goal and Hossa added two assists to provide the offense, while Emery made 15 saves as the Hawks recorded their third shutout of the season.

Crawford was credited with the victory after making six saves in the first. After the period, he gingerly made his way off the ice and didn't return. Coach Joel Quenneville said Crawford would travel back to Chicago with the team Thursday night and is day-to-day.

"Hopefully, it's just our training staff being cautious and he'll be healthy," Toews said. "In a case like that, we know Ray can step in and take care of the job."

Emery did just that, shutting down a Blues team that was without key offensive players Andy McDonald, Vladimir Tarasenko and Alexander Steen. Jaroslav Halak suffered the loss in goal as he couldn't match Crawford and Emery.

"The guys played a really good defensive game," Emery said. "You're kind of surprised when you get to go in in the second. You have to be prepared for that, (but) that's why I'm there."

Hawks penalty killers were again outstanding as the units blanked the league's top power play in four opportunities. The Blues entered the game scoring 30.6 percent of the time with a man advantage but came up empty on five shots against the Hawks.

"Our team game, led by the goalies, was really strong in all zones," Quenneville said. "Penalty killing did a great job against the top power play in the league. Everybody contributed in a comparable way like we've had all year.

"We've had some good games to date, but that might have been the best."

ckuc@tribune.com

Twitter @ChrisKuc

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Risk assets rise on Fed stimulus vow, Italy debt sale

TOKYO (Reuters) - Asian shares, commodity currencies and oil rose on Thursday as sentiment improved after U.S. Federal Reserve Chairman Ben Bernanke reaffirmed his commitment to strong stimulus measures, while a smooth debt sale calmed nerves jangled by Italy's political deadlock.

European markets are seen extending gains for a second day, with financial spreadbetters predicting London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> would open as much as 0.6 percent higher. <.l><.eu/>

A 0.1 percent rise in U.S. stock futures also hinted at a firm Wall Street start. <.n/>

The MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> was up 0.3 percent and was set for a monthly gain of 0.7 percent.

Australian shares <.axjo> soared 1.5 percent, Hong Kong shares <.hsi> added 1.2 percent and Indonesian stocks <.jkse> continued their bull run to hit another historic peak after closing on Wednesday at a record.

Japan's Nikkei stock average <.n225> climbed 1.3 percent as the yen softened. <.t/>

The yen was defensive, with Japanese Prime Minister Shinzo Abe nominating Asian Development Bank President Haruhiko Kuroda as Bank of Japan governor, and academic Kikuo Iwata as one of the two deputy governors. Both are seen by markets to support Abe's call for unconventional reflationary stimulus measures, and that view has underpinned yen selling.

Italy's inconclusive election last weekend raised fears that the euro zone's third-largest economy could abandon its fiscal reforms, but analysts and traders say they expect Rome to pursue a basic austerity path to pare down its huge debt, even if is at a more moderate pace, and that the European Central Bank will stand ready to provide funding support if needed.

The rally in equities and other risk assets showed the dimming appeal of safe-haven investments. A day after slumping nearly 1 percent on Wednesday, spot gold traded little changed around $1,597 an ounce and was headed for its longest run of monthly declines in more than 16 years.

"Gold's sentiment remains fickle, as it lacks a significant catalyst to propel the rally into the 13th year and people are more sensitive to even slightly bearish signs," said Chen Min, an analyst at Jinrui Futures in the southern Chinese city of Shenzhen.

Bernanke, speaking before Congress for a second day, downplayed signs of internal divisions, saying the policy of quantitative easing has the support of a "significant majority" of top central bank policymakers.

Uncertainty over an imminent U.S. fiscal tightening could dampen the positive mood, however, as President Barack Obama and Republican congressional leaders have not reached a deal to avoid the $85-billion in automatic "sequestration" spending cuts, due to start on Friday.

Regional data released on Thursday was mixed.

Australian business investment showed a surprise fall last quarter as firms outside the red-hot mining sector cut back, while estimates of future spending confirmed the long boom in resource investment was likely to end this year.

Japan's industrial output, on the other hand, rose for a second straight month in January, offering some evidence that the export-reliant economy may be emerging from a mild recession, taking strength from a pick-up in global demand and the weaker yen.

ITALY SURVIVES

Italy's borrowing costs rose to a four-month high on Wednesday at the first bond auction since this week's inconclusive election but solid demand from domestic investors eased fears that the political deadlock could destabilize Europe's second-biggest sovereign debt market.

"Indeed there is room for optimism -- if the Italian risks remain contained -- as signals of stabilization continue to emerge," Barclays Capital said in a note.

The euro inched up 0.1 percent to $1.3143, well above a seven-week low of $1.3018 on Tuesday.

Others were more cautious.

"While confidence is high, there are still risks present. Negative political news from Italy may provide headwinds, while the looming 1 March deadline for the U.S. sequester could trigger $85 billion of across-the-board budget cuts," said Miguel Audencial, a sales trader with Sydney-based CMC Markets.

The yen steadied around 92.24 against the dollar. The yen hit its lowest since May 2010 of 94.77 on Monday before the outcome of the Italian vote rattled financial markets and sent the yen soaring to 90.85 yen.

The yen eased 0.1 percent against the euro to 121.19 after jumping to 118.74 on Monday.

U.S. crude rose 0.3 percent to $93.02 a barrel while Brent rose 0.2 percent to $112.07.

(Additional reporting by Luke Pachymuthu and Rujun Shen in Singapore; Editing by Eric Meijer)

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Election puts Italy on financial high-wire

Prime Minister Silvio Berlusconi delivers a speech during a campaign rally in Rome on January 25, 2013.

STORY HIGHLIGHTS

• Brilliant minds are still trying to figure out the financial impact of Italy's election


• The lack of certainty is seen as a negative for Italy -- and the eurozone


• Instability could reignite the eurozone crisis


• But it depends on what deal will be done, and how the markets will respond

Editor's note: Louise Cooper is a financial blogger and commentator who regularly appears on television, radio and in print. She started her career at Goldman Sachs as a European equity institutional sales person and then become a financial and business journalist. She now writes CooperCity.

London (CNN) -- Brilliant minds across the financial world are still trying to work out the implications of the Italian election result.

For the time being, the best answer is that it is probably too soon to tell. After Tuesday's falls, a little stability has returned to markets, possibly because everyone is still trying to work out what to think.

Credit ratings agency Moody's has warned the election result is negative for Italy -- and also negative for other indebted eurozone states. It fears political uncertainty will continue and warns of a "deterioration in the country's economic prospects or difficulties in implementing reform," the agency said.

For the rest of the eurozone, the result risks "reigniting the euro debt crisis." Madrid must be looking to Italy with trepidation. If investors decide that Italy is looking risky again and back off from buying its debt, then Spain will be drawn into the firing line too.

Can the anti-Berlusconi save Italy?

Louise Cooper, of Cooper City

Standard & Poor's stated that Italy's rating was not immediately affected by the election but I think the key part of that sentence is "not immediately."

At the same time Herman Van Rompuy's tweets give an indication of the view from Brussels: "We must respect the outcome of democratic elections in Italy," his feed noted.

Really? That's a first. The democratically elected Silvio Berlusconi was forced out when he failed to follow through with austerity after the European Central Bank helped Italy by buying its debt in autumn 2011.

"It is now up to Italian political leaders to assume responsibility, compromise and form a stable government," Van Rompuy tweeted.

Did he see the results? The newcomer and anti-establishment comedian Beppe Grillo refuses to do a deal and yet he is the natural kingmaker, polling at 25%.

"Nor for Italy is there a real alternative to continuing fiscal consolidations and reforms," he continued.

Economically yes, but the Italian electorate disagree. And for the time being, Italy has a democracy (of sorts).

Finally: "I am confident that Italy will remain a stable member of the eurozone."

He hopes...

The key to whether the crisis reignites is whether investors begin to back away from lending to Italy. If so, this will be the big test of the ECB's resolve to save the euro.

Read more: Euro crisis coverage

The key thing to look at is Italian bonds, because if borrowing costs rise from 4.8% for 10-year money currently to nearer 6%, then Italy will start to find it too expensive to borrow.

The trillion euro question is if the ECB will step in to help even if it cannot get the reforms and austerity it demands (because of the political situation). That is the crux of the matter. And there will be many in the city today pondering that question.

Clearly in financial markets, taking on a central bank is a dangerous thing to do. Soros may have broken the Bank of England on Black Wednesday 1992, making billions by forcing sterling out of the EMU, but that was a long time ago.

Italy avoids panic at bond auction

What we have learnt from this crisis is not to "fight the Fed" (or the ECB). Last summer, the ECB's chief Mario Draghi put a line in the sand with his "whatever it takes" (to save the euro) speech.

But as part of that commitment he stressed time and time again that any new help from the ECB comes with conditions attached. And those conditions are what have proven so unpalatable to the Italians -- austerity and reform.

So we have two implacable objects hurtling towards each other. The political mess of Italy and the electorate's dislike of austerity and reform (incumbent technocrat Mario Monti only polled 10%).

So what happens next? The status quo can continue if Italian borrowing costs do not rise from here and therefore Italy does not need ECB help.

If markets continue to believe in Draghi and Brussels that the euro is "irreversible," then investors will continue to lend to Italy. Yes, markets will be jittery and fearful, but Italy will eventually sort itself out politically.

The big advantage for Italy is although it has a lot of debt, it is not creating debt quickly (like Greece, Spain or even the UK). And as I said yesterday on my CooperCity blog, the positive outcome from all this could be that Brussels backs off from austerity, which would be a good thing.

However, the basic rule of finance is that high risk comes with high return. Soros took a huge gamble against the British central bank but it reportedly made him a billionaire overnight.

There must be a few hedge funders looking at the Italian situation with similar greed in their eyes. If he wants to save the euro, it is time for Mario Draghi to put the fear of God back into such hearts.

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Chicago archdiocese to close 5 schools in cost-cutting move

Budget cuts announced Wednesday by the Archdiocese of Chicago signal that the area's Roman Catholics are entering a period of austerity when there will be less money for their parishes and schools.

The cuts, which were officially announced as Cardinal Francis George and other leaders of the church gathered at the Vatican to select a new pope, include closing five schools, eliminating 75 positions at the archdiocese's headquarters and placing a moratorium on loans to parishes from the archdiocese bank for three years. Other changes include creating stricter guidelines for local parishes applying for subsidies and reducing the number of the agencies in the archdiocese.

George, who spoke publicly about the cuts when asked by reporters in Rome, said they are needed to address the archdiocese's chronic financial problems. The archdiocese has run deficits of more than $30 million annually over the last four years, including being $40 million in the red for the fiscal year ending in June 2012.

All told, the measures will save tens of millions of dollars over the next few years, officials said.

“The expenses have gone up, and the income is pretty well flat,” George said after a news conference in Rome about Pope Benedict XVI's last audience Wednesday in St. Peter's Square. “We tried to ride out the recession without making any changes — and we can't do that. We're giving more grants to parishes and schools that need more money. The budget is not balanced. Not just layoffs, but a lot of other things being done, other ways to use the resources we have.”

The archdiocese sold $150 million in bonds in 2012 that helped it get through a cash-flow problem, but ultimately that wasn't enough, George said. He hopes the cuts will enable the archdiocese to balance its budget in two years.

Although the cardinal's announcement made headlines, the archdiocese's financial situation has been no secret to its priests. Several clergymen said they knew the archdiocese had planned to scale back loans to parishes.

“We have already made adjustments,” said the Rev. Dennis Ziomek of St. Barbara Parish in Chicago's Bridgeport neighborhood. “We have to be responsible stewards with the money.”

In a letter posted on the archdiocese website, the cardinal thanked parishioners for their generosity and asked them to pray for the employees now out of a paycheck.

At the archdiocese's Pastoral Center headquarters on Wednesday, people funneled in and out of the building during their lunch breaks but declined comment on the layoffs. Before the announcement, staffers received memos asking them to report to their desks early Wednesday.

Of the 75 positions, 55 were full-time jobs. Sixty people were let go, while the remaining posts had been vacant. Those cuts are expected to save $11 million to $13 million annually by fiscal 2015, George wrote in his letter.

Employees who received pink slips will get job counseling, extended health benefits and generous severance packages.

“We're keeping up counseling for helping people find jobs, looking for places where they might look for jobs,” George said.

Along with the layoffs, the archdiocese will reduce the number of capital loans and grants it gives parishes, while creating “stricter criteria” for them to qualify for the financial assistance.

A Parish Transformation initiative in the works for at least two years will also try to save money by laying out measures to provide more financial stability, though the letter did not give details.

Those cuts are expected to save an additional $13 million to $15 million annually by fiscal 2015, the letter states.

By next year, the archdiocese will reduce its aid to Catholic schools by $10 million. It plans to give scholarships to children affected by the five school closings so they can attend nearby Catholic schools. Officials said low enrollment was a key factor for closing the schools: St. Gregory the Great High, St. Paul-Our Lady of Vilna Elementary and St. Helena of the Cross Elementary in Chicago, plus St. Bernardine in Forest Park and St. Kieran in Chicago Heights.

Now, Catholic schools will start relying on scholarships for student financial aid instead of grants from the archdiocese to make tuition affordable, Superintendent Sister Mary Paul McCaughey said.

She pointed to a new partnership with the Big Shoulders Fund, a charity supporting urban Catholic schools, that will help families pay for school with scholarships.

McCaughey did not expect tuition at other Catholic schools to immediately rise because grants from the archdiocese have been reduced. About two-thirds of schools already have posted their tuition rates for the upcoming school year, she added.

“Although things are challenged, I think (Chicago) is a Catholic community that's always supported its schools,” McCaughey said. “I think the support will be there.”

Outside of St. Bernardine Elementary in west suburban Forest Park, one of the schools that will close this summer, Maria Maxham said she was devastated when she heard last month that she'd have to send her children, one in second grade and the other in fourth grade, to a different school.

Maxham, who lives in Forest Park, said she is not sure the two will attend another local Catholic school because some lack what she thought was St. Bernardine's strength.

“There is so much diversity at St. Bernardine, and that's part of what makes it so fantastic,” Maxham said. “It was a special place and a second family for us.”

The school, which has been open since 1915, has about 100 students currently enrolled in its preschool-through-eighth-grade classrooms.

Administrators, teachers and parents were notified of the closing in January, when McCaughey led a meeting at the school and explained the large amount of money that the archdiocese needed to reduce from the schools budget, Principal Veronica Skelton Cash said.

One family left the school shortly after hearing the news, she added.

Cash, who joined the school in the fall, said there was much frustration among staff members afterward. Many believed they would have at least a few years to turn things around.

“I could see a lot of things changing for the better at this school,” Cash said. “The culture of the community is changing, and we were getting more and more inquiries about the school. There was momentum going forward.”

Current employees were given guidance on severance and benefits by the archdiocese's human resources officials, Cash said. Teachers without jobs will also be placed on a priority list for future employment with the archdiocese, she said.

“I'm incredibly disheartened,” said Daniel Kwarcinski, who hopes to find a job at another private school after teaching art for seven years at St. Bernardine. “There's a need for a school like this where we are at.”

In Rome, George said the decisions to let people go and reduce aid were not easy. But he reiterated that the archdiocese's financial situation drove the decision.

“We have to balance the budget, especially if it's precarious,” he said. “The growth being very slow means we can no longer ignore the kinds of deficit situations that have been imposed on us. We have to take action.”

Tribune reporter Manya A. Brachear reported from Rome, with Tribune reporters Bridget Doyle and Jennifer Delgado in Chicago.

mbrachear@tribune.com

bdoyle@tribune.com

jmdelgado@tribune.com

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Wall Street rebounds on Bernanke comments, data

NEW YORK (Reuters) - U.S. stocks rebounded from their worst decline since November on Tuesday after Federal Reserve Chairman Ben Bernanke defended the Fed's bond-buying stimulus and sales of new homes hit a 4 1/2-year high.

The S&P 500 had climbed 6 percent for the year and came within reach of all-time highs before the minutes from the Fed's January meeting were released last Wednesday. Since then, the benchmark S&P 500 has fallen 1 percent.

Bernanke, in testimony on Tuesday before the Senate Banking Committee, strongly defended the Fed's bond-buying stimulus program and quieted rumblings that the central bank may pull back from its stimulative policy measures, which were sparked by the release of the Fed minutes last week.

Bernanke's comments helped ease investors' concerns about a stalemate in Italy after a general election failed to give any party a parliamentary majority, posing the threat of prolonged instability and financial crisis in Europe, and sending the S&P 500 to its worst decline since November 7 in Monday's session.

Bernanke "certainly said everything the market needed to feel in order to get comfortable again," said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.

"The fear is we were going to see a rollover, and the first shot over the bow was what we saw out of Italy yesterday with the elections," Kenny said. "When it came to U.S. markets, we saw some of that bleeding stop because our focus shifted from the Italian political circus to Ben Bernanke."

Gains in homebuilders and other consumer stocks, following strong economic data, lifted the S&P 500, and a 5.7 percent jump in Home Depot to $67.56 boosted the Dow industrials. The PHLX housing sector index <.hgx> rose 3.2 percent.

Economic reports that showed strength in housing and consumer confidence also supported stocks. U.S. home prices rose more than expected in December, according to the S&P/Case-Shiller index. Consumer confidence rebounded in February, jumping more than expected, and new-home sales rose to their highest in 4-1/2 years in January.

However, the central bank chairman also urged lawmakers to avoid sharp spending cuts set to go into effect on Friday, which he warned could combine with earlier tax increases to create a "significant headwind" for the economic recovery.

The Dow Jones industrial average <.dji> gained 115.96 points, or 0.84 percent, to 13,900.13 at the close. The Standard & Poor's 500 Index <.spx> rose 9.09 points, or 0.61 percent, to 1,496.94. The Nasdaq Composite Index <.ixic> advanced 13.40 points, or 0.43 percent, to close at 3,129.65.

Despite the bounce, the S&P 500 was unable to move back above 1,500, a closely watched level that was technical support until recently, but could now serve as a resistance point.

The CBOE Volatility Index <.vix> or the VIX, a barometer of investor anxiety, dropped 11.2 percent, a day after surging 34 percent, its biggest percentage jump since August 18, 2011.

The uncertainty caused by the Italian elections continued to weigh on stocks in Europe. The FTSEurofirst-300 index of top European shares <.fteu3> closed down 1.4 percent. The benchmark Italian index <.ftmib> tumbled 4.9 percent.

Home Depot gave the biggest boost to the Dow and provided one of the biggest lifts to the S&P 500 after the world's largest home improvement chain reported adjusted earnings and sales that beat expectations.

Macy's shares gained 2.8 percent to $39.59 after the department-store chain stated it expects full-year earnings to be above analysts' forecasts because of strong holiday sales.

Volume was active with about 7.08 billion shares traded on the New York Stock Exchange, NYSE MKT and Nasdaq, above the daily average of 6.48 billion.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 2 to 1, while on the Nasdaq, three stocks rose for every two that fell.

(Reporting by Chuck Mikolajczak; Editing by Jan Paschal; Editing by Jan Paschal)

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Mbakwe, Minnesota take down No. 1 Indiana 77-73

MINNEAPOLIS (AP) — Indiana was starting to settle in again at No. 1 after weeks of shuffling at the top of the national rankings in this wildly unpredictable season of college basketball.

Trevor Mbakwe and Minnesota stepped forward, flexed their muscles and did their best to push the Hoosiers out.

Mbakwe had 21 points and 12 rebounds to help the Gophers take down top-ranked Indiana 77-73 on Tuesday night, the seventh time the No. 1 team in The Associated Press' poll has lost a game this season.

"We're trying to do big things so we have to learn from this mistake, but we have to dust it off real fast," Hoosiers star Victor Oladipo said.

Andre Hollins added 16 points for the Gophers (19-9, 7-8 Big Ten), who outrebounded Cody Zeller and the Hoosiers by a whopping 44-30 and solidified their slipping NCAA tournament bid with an emphatic performance against the Big Ten leader. The fans swarmed the court as the last second ticked off, the first time that's happened here in years.

"We weren't physical enough on the glass. That's the bottom line," Indiana coach Tom Crean said.

Zeller was held to nine points with four turnovers for the Hoosiers (24-4, 12-3), who have held the No. 1 ranking for 10 of 17 polls this season including the last four. Oladipo scored 16 points, but 14 of the 17 points by Jordan Hulls came before halftime.

"Cody's certainly capable of a lot," Crean said, "and I think he'll bounce back just fine."

Mbakwe, a sixth-year senior, posted his conference-leading seventh double-double. At 24 years old, he was a man among boys in many ways in this game, dominating both ends of the court when the Gophers needed him most. Minnesota had 23 offensive rebounds.

"We did need to play with a sense of urgency, play with a little edge," Gophers coach Tubby Smith said. "I think Trevor set that tone for us."

Elliott Eliason, who played every bit as well as Zeller, the slender sophomore in the post on the other side, scored seven straight points for Minnesota to tie the game at 46 shortly after Oladipo's reverse layup had given the Hoosiers a 44-36 edge, their biggest of the game.

Hollins, who missed eight of his first nine shots, scraped off a high screen by Eliason to pull up for a 3-pointer and give the Gophers a 51-48 lead. Mbakwe got a rebound to keep a key possession alive then grabbed another board to set up his off-balance bank shot to make it 56-53 in favor of Minnesota.

"I didn't feel I was playing up to my potential lately. I just wanted to come out and be aggressive," Mbakwe said.

Mbakwe was called for a loudly questioned blocking foul, his fourth, with 4:39 remaining on Zeller's fast-break layup and free throw that put the Hoosiers up 59-58. But Austin Hollins answered with a pump-fake layup that drew a foul for a three-point play and a two-point advantage for the Gophers.

The Hoosiers didn't lead again, and Joe Coleman's fast-break dunk with 2:35 left gave Minnesota a 68-61 cushion, enough of one to withstand a couple of 3-pointers by Christian Watford and one by Hulls in the closing minutes.

Mbakwe, who played for Crean when they were at Marquette in 2007-08, has had some of his better games against the Hoosiers.

This was his best.

He gave the Gophers and their home crowd a double-shot of energy early with 10 points in the first 6½ minutes, plus a jarring block of Zeller's inside shot that knocked the 7-footer to the court.

"He's a high-level, high-energy, tough guy who plays the game at a desperate level," Crean said. "Obviously I'm biased, but there's no shame in that."

Zeller, Indiana's leading scorer and the second-best shooter in the Big Ten behind Oladipo, was 0 for 4 from the field in the first half with two turnovers, two fouls and two points. The Gophers scored only three points in the last 7 minutes of the half, but they trailed only 34-30.

The Hoosiers are still in position for their first outright Big Ten regular season championship since 1993, with a one-game edge in the loss column over Michigan State, Michigan and Wisconsin. With home games against Iowa and Ohio State, Indiana could still clinch the title before the finale at Michigan on March 10.

For now, though, the Hoosiers have to regroup and re-establish their inside game after the trampling in the paint they endured here.

"They were relentless on the glass. We just didn't do a great job of boxing them out," Oladipo said.

The Gophers were back on their uniquely raised home court, trying desperately to boost spirits that have sagged under the weight of eight losses in their previous 11 games. Smith even had the team meet with a sports psychologist. They hadn't topped 58 points in their previous five games. After being ranked in 11 straight polls, the Gophers didn't get one vote this week.

They'll get a few in the next one.

"We've had a lot of people supporting them, encouraging them. I think they knew how important the game was, but I sensed a very calm, matter-of-fact group of guys," Smith said, adding: "They're very confident about who they are."

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Follow Dave Campbell on Twitter: http://www.twitter.com/DaveCampbellAP

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