(Reuters) – The number of Americans commuting by public transportation rose to the second highest level on record last year, as more people returned to work, according to an annual survey released by the leading U.S. transit association on Monday.

The growth in ridership would have been even stronger, if Superstorm Sandy had not stranded people and shut down transit along the East Coast, where public transportation is most concentrated, American Public Transportation Association President Michael Melaniphy said.

Altogether, U.S. transit ridership rose 1.49 percent, with passengers taking 10.52 billion trips on trains, buses and commuter rail in 2012.

The increase was universal across the different modes of transit.

There were 1.42 percent more trips on heavy rail such as subways, 4.47 percent more on light rail, and 0.52 percent more on commuter rail than in 2011. Meanwhile, bus ridership grew 1.2 percent. Some of the light rail rise came from cities expanding or creating lines.

In the final quarter of the year, though, transit use was lower than in the fourth quarter of 2011, a reflection of Superstorm Sandy hitting in the fall. In November, New York and New Jersey, the states struck most by the storm, lost at least 41,600 jobs.

Rising fuel prices and a dislike of traffic contributed to the largest transit ridership since 2008, which was the highest year on records dating back to 1957, Melaniphy said.

Nonetheless, he added, nearly 60 percent of all transit trips are taken by people going to work.

“You can’t get people back to work unless you can get them to work,” Melaniphy said.

While the U.S. unemployment rate is stuck above the 6.5 percent that most economists consider healthy, it has been dropping for more than a year. The rate ended 2012 at 7.8 percent, well below where it ended 2011, 8.5 percent, according to Labor Department statistics.

The association points to places such as Seattle, Washington, where transit rides rose 11.8 percent over the year as the metropolitan area added more than 30,000 jobs.

At least 15 transit systems experienced record ridership last year, according to APTA. While some were in cities with well-established public transportation, such as Boston, Massachusetts, others were in areas associated more with freeways and commuting by car – namely Riverside and San Bernardino, California.

The question hanging over the industry is whether transit can meet mounting demand. Traditionally, fares only represent part of the agencies’ capital and operating budgets, with federal, state and local governments providing a hefty share.

Melaniphy points to voter initiatives to raise taxes for transit that passed last year – 49 out of 62 measures placed on ballots. The association has not seen such a high passage rate for transit funding initiatives since 2000.

Places where Sandy damaged the infrastructure are borrowing to bring transit back on-line. New York’s Metropolitan Transportation Authority, which carried 11 million bus and train passengers each day, has approved selling up to $2.5 billion of short-term bond anticipation notes for Sandy costs.

At the same time, the U.S. Congress in 2012 passed a long-awaited authorization for funding surface transportation. It includes loan, financing and grant programs that systems will be able to use for repairs or new equipment. The account, supplied by gas tax revenues used to fund federal transportation, was put off-limits from the $85 billion in spending cuts known as “sequestration.”

(This story corrects a figure in the third paragraph to billion, not million)

(Reporting by Lisa Lambert; Editing by Jackie Frank)

(Reuters) – Has “South-by” lost its direction?

For several years running, that question has hovered over the iPhone-clutching tech cogniscenti who made the annual springtime pilgrimage to the mecca of geek- and hipster-dom in Austin, Texas.

In 2007 the South by Southwest Interactive festival – the five-day digital offshoot of SXSW, the two-week-long gathering for music and film lovers – solidified its reputation as the place for entrepreneurs and tech investors to see and be seen after the conference helped boost a then-little-known service called Twitter to prominence.

Since then, the interactive festival’s popularity and its ticket prices have skyrocketed — and so have complaints from the geeks that it has become too big, too crowded, too expensive and too hopelessly awash in corporate sponsorship money.

The anxieties hit new highs this year as app makers largely eschewed using the event as a launching pad, even while marketing dollars from consumer brands such as Oreo, American Airlines AAMRAQA.UL and General Motors’ (GM.N) Chevrolet seemed to flow as freely as company-expensed margaritas.

Greg Cohn, a Los Angeles entrepreneur who recently launched Burner, an iPhone messaging app, decided to forgo the festival for the first time since 2005, saying he felt the conference had become overwhelmed by large advertisers and was increasingly irrelevant for startups jostling to get their name out.

“It’s a lot less intellectually stimulating, a lot less organic and authentic,” said Cohn, who opted to attend a new conference in Portland, Oregon, called XOXO, started this year by disaffected SXSW veterans. “It feels like SXSW has gone bankrupt, and it needs a new start.”

In Silicon Valley – where embracing the new and ditching the old can sometimes be a serious sport – more than a few sniffed at SXSW.

“It’s jumped the shark,” said Mike Volpi, a partner at Index Ventures, who stayed home.

Eric Eldon, co-editor of startup blog-of-record Techcrunch, reluctantly said he was headed for Texas – “but only for Music and Film,” he quickly added. (Techcrunch later published a post headlined: “No Hot SXSW App This Year? Here’s Why.”)

The startup world may have cooled on Austin, but the five-day festival, which ends on Tuesday, is still plenty hot. Almost two decades after it began, SXSW Interactive has grown vastly more diverse in subject matter and more mainstream, with dozens of do-it-yourself workshops and “meetups” to accompany the panels. This year it is on track to break the 25,000 attendance record it set last year, organizers said.

OREOS AND VIDEOS

Above all, it was the brand marketers who were this year’s stars, evidenced by Oreo Cookies’ mascot strolling through the Austin Convention Center and the “grab-and-go” cookie packs the company gave away. Chevrolet offered rides in cars equipped with voice-recognition software and parked two model cars in front of the convention center, while Target (TGT.N) transformed the rear of a restaurant into a “Tarcade” hall filled with videogames. American Airlines and AT&T (T.N) held a joint “hackathon.”

Hugh Forrest, a former alternative newspaper journalist who has organized SXSW Interactive since its inception in 1994, said he “frequently hears criticism” about the festival’s evolution but noted that it now offers a head-spinning 800 panels and events to choose from, compared with just 16 two decades ago.

“Is there a larger presence of corporate sponsors? Yes,” Forrest said. “But also there are more smaller, indie, bootstrapped things as well. Sponsors help us out with a lot of things we couldn’t do before.”

Sitting in a “Gold Lounge” with Doritos and a dozen other logos plastered on the wall inside the Austin Convention Center — an irony he pointed out with a chuckle — Forrest noted that the advertising-supported business model should be something many app makers at SXSW understand well.

“We’d be silly and naïve to think marketing is not a big part of new media and culture and business at this point,” Forrest said. “That’s how many, many things get paid for.”

As SXSW’s programming has ballooned in recent years, its offerings have been fleshed out by a surging number of sub-topics, such as health and medicine or public service and activism. Even the startups sphere has expanded, there have been an increasing number of advanced design-related programs.

Since it was introduced in 2010, the news and media track has in particular become a cornerstone of the festival’s programming, as digital outlets and traditional news organizations alike flock to Austin to discuss their fast-changing industry, said Jennifer 8. Lee, a former newspaper reporter and volunteer SXSW organizer.

Lee noted that with the growing corporate presence, the festival’s culture has become more free-spending in recent years, even though she argued that its overall quality is still rising.

“The difference is that this once was a place where people paid their own way, or you somehow got a badge by doing a panel,” said Lee, as she doled out drink tickets Saturday night to a party crowd that included CNN Digital Managing Editor Meredith Artley and New York Times Executive Editor Jill Abramson. “Now you come with a bunch of co-workers and expense it,” Lee said. “It’s like spring break for adults.”

MEETING AND GREETING

One of the companies with a big presence was the advertising agency JWT, the WPP Group (WPP.L) subsidiary, which flew more than 60 ad execs from its offices around the world.

The agency started what it called a five-day “pop-up” ad agency that took several dozen pitches from startups in Austin and offered its marketing services for free to a chosen winner.

David Eastman, the chief executive of JWT North America, said firms like his relished a lucrative marketing opportunity like SXSW, though he saw the irony in his presence.

“The bad side of all this is that SXSW used to be indie, for the folks who didn’t want to be mainstream,” Eastman said. “When the brands arrive, the money arrives as well.”

Still, the cynicism wasn’t nearly so pervasive among the younger generation, especially the enthusiastic attendees on their first or second trips.

“I haven’t seen any new startups make their big launch here, but it’s been great for meeting people and making new friends,” said Sahil Lavingia, the 20-year-old founder of Gumroad, a fast-growing online payment-processing startup backed by venture capital firm Kleiner Perkins Caufield & Byers.

Then there were those who shrugged off SXSW’s fading appeal – then showed up anyway.

Then there were those who just showed up for – what else? – the parties.

Nick Denton, the Gawker Media founder, pondered the matter as he ducked into a downtown hotel elevator Saturday night.

“People have been asking that for a while,” Denton said with a smirk. “So maybe the question’s jumped the shark.”

(Reporting By Gerry Shih; Editing by Douglas Royalty)

(Reuters) – Wall Street stocks edged up on Monday, approaching a 5-1/2-year high, on optimism about the U.S. economy and easy monetary policy from the Federal Reserve, while U.S. oil prices rebounded after falling due to disappointing Chinese industrial data.

Fitch Ratings’ cut in Italy’s credit rating late on Friday spurred some selling in European shares and Italian government bonds while supporting safe-haven bids for gold, U.S. and German government debt and other perceived lower-risk assets.

The dollar clung to gains from the payrolls data, trading near a 3-1/2-year high against the yen and a 3-month peak versus the euro. <FRX/>

The benchmark Standard & Poor’s 500 stock index .SPX was on track to extend its winning streak to seven sessions and touched its highest intraday level since October 15, 2007. Wall Street overcame early losses on worries about China and Italy.

Friday’s surprisingly strong U.S. jobs report, along with encouraging data on the housing market, reinforced the appetite for stocks and views of the market posting further gains with help from the Fed.

“There’s real belief in this rally,” said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York. “There are lots of investors out there looking for opportunities to put more money to work in equities, and they’re using these little pullbacks we’ve had – and there haven’t been many – as purchasing opportunities.”

Nonetheless, a closely watched fear indicator was in rapid retreat.

Wall Street’s “fear gauge,” the CBOE Volatility Index, also known as the VIX .VIX, fell to the lowest level since April 2007, shedding 5.5 percent to 11.90.

The resilience on Wall Street and a 0.53 percent gain in Tokyo shares .N225 helped MSCI’s world equity index .MIWD00000PUS to rise 0.37 percent to 361.42, near its mid-2008 highs.

In midafternoon trading, the Dow Jones industrial average .DJI was up 36.06 points, or 0.25 percent, at 14,433.13. The Standard & Poor’s 500 Index .SPX was up 4.16 points, or 0.27 percent, at 1,555.34. The Nasdaq Composite Index .IXIC was up 5.82 points, or 0.18 percent, at 3,250.18.

Europe’s broad FTSEurofirst 300 index .FTEU3 closed off 0.05 percent at 1,194.64, down from September 2008 peaks hit last week, as the Italy rating cut and weak Chinese factory output data undermined sentiment.

China reported over the weekend that annual industrial production for January and February combined rose 9.9 percent, the lowest since October 2012, while its consumer price index jumped more than expected last month.

Fitch on Friday cut Italy’s debt to BBB-plus from A-minus and gave the rating a negative outlook, raising the risk its next ratings change will be a further downgrade.

Anxiety over further deterioration in the euro zone’s third-biggest economy pushed 10-year Italian government bond yields up 7 basis points to 4.66 percent.

“I think the Italian downgrade is acting as a bit of a wake-up call,” said Alastair Winter, chief economist at investment bank Daniel Stewart & Co in London.

The benchmark 10-year U.S. Treasury note traded in a narrow range and was last down 3/32 in price with a 2.0504 percent yield. <US/>

Safe-haven gold posted modest gains, last up 0.2 percent at $1,580.11 an ounce. Gold bullion was seen staying within a range of $1,560 to $1,590. <GOL/>

OIL FALLS, DOLLAR FIRM

In addition to Italy’s downgrade, the slower-than-expected growth in Chinese factory output briefly crimped investor sentiment on oil, copper and other raw materials.

U.S. oil futures settled up 11 cents or 0.12 percent at $92.06 a barrel, erasing an early loss of more than $1.

But Brent crude fell 73 cents or 0.66 percent to $110.12 a barrel, after ending last week marginally higher to snap three straight weekly losses. <O/R>

Three-month copper on the London Metal Exchange closed at $7,755 a metric tonne, up from a previous close of $7,740, having earlier hit a one-week low of $7,667 a tonne.

In the foreign exchange markets, the dollar added to gains it made against most major currencies after Friday’s strong payrolls data boosted hopes of a steady U.S. economic recovery this year.

The data has also fueled speculation the U.S. Federal Reserve could back off from its ultra-loose monetary policy sooner than anticipated, and this added to the currency’s appeal as traders speculated about looser policies by other major central banks ahead.

The dollar dipped 0.1 percent at 82.59 against a basket of major currencies .DXY, not far from the seven-month high of 82.92 hit on Friday. The currency has risen nearly 5 percent since early February.

The euro was flat at $1.3035, not far from a three-month low of $1.2955 also hit on Friday, while the yen managed a 0.2 percent rise against the greenback at 96.23 yen.

(Additional reporting by Angela Moon and Wanfeng Zhou in New York and Richard Hubbard, David Brett, Anooja Debnath, and Clara Denina in London; Editing by Chizu Nomiyama and Dan Grebler)

A spectrally selective approach could let tablets, e-readers, and windows turn light into power

By Kate Greene on February 25, 2013

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By Susan Young on February 25, 2013

Newly observed properties mean graphene could be a highly efficient converter of light to electric power.

By Mike Orcutt on March 1, 2013

(Reuters) – Despite the drama concerning U.S. agencies potentially dimming lights due to the sequester saga, global companies are brightening the scenario for technology purchasing. That could spark a turnaround in the sluggish sector.

Telecommunication services and information technology are laggards in the U.S. stock market’s current bull rally, up only 3.6 percent and 2 percent year-to-date, respectively, through February 22. That compares with a 6.6 percent rise for the broader S&P 500 Index.

This contrasts with consumer staples and discretionary items, which are up more than 9 percent and 5.8 percent, respectively, according to S&P. This reflects widespread optimism that consumer spending will return.

But there are signs that the beleaguered tech sector is about to be bolstered. Companies from service providers to manufacturers are starting to ramp up their information technology (IT) spending, which is a clear sign that economic confidence is in vogue and a business cycle is on the upswing. As more employees than ever are working from home or on the road, companies are updating their “fleet” of company-provided communications devices and data services.

The largest segment of IT spending, according to research firm Gartner Inc, will be in global telecom, which includes mobile data and voice services. IT services and devices – PCs, tablets, phones and printers – are next on the spending priority list. Although telecom service spending is forecast to rise only 2.4 percent this year, enterprise software and device purchases are expected to climb more than 6 percent each.

Despite myriad economic difficulties around the world, information technology spending worldwide posted record annual growth of nearly 6 percent last year, according to the International Data Corporation. Spending on smartphones in 2012 exceeded PCs for the first time, reaching almost $300 billion, while PC spending declined to $233 billion, IDC reported. That trend is expected to continue this year.

NEXT WAVE

The last major wave of tech spending occurred prior to 2000. The sector would have been due for another cycle of capital spending by 2008, but it was delayed because of the financial meltdown. While spending might not be as robust as during the run-up to 2000, this cycle could be broad-based and focused on a wide range of products and services.

Worldwide information technology spending is forecast to climb 4.2 percent from 2012 levels, according to the Gartner Group. A Thomson Reuters survey released on February 22 found that S&P 500 firms’ spending plans are exceeding analysts’ estimates. That translates into more capital expenditures. The bulk of the tech spending, Gartner forecasts, will be directed at enterprise software, information technology services and devices.

Investors need to pay attention because tech companies have a long way to go before they are seen as overvalued. They also have yet to be classified as a genuine comeback sector like financials, which are up nearly 8 percent this year, although that may change this year as more buying shifts to technology.

A hidden benefit to owning technology stocks right now is that many of the leaders in this sector are swimming in cash and are beginning to pay dividends. Apple Inc, for one, is down 35 percent from its September peak through Thursday, but is sitting on a $137 billion cash hoard and paid its first dividend last year.

WHERE TO INVEST

Investors do best with balanced portfolios that spread investments broadly across a sector or index. But with tech funds, this is tricky because most have large concentrations in Apple, which still has more downside risk as it faces stiffer competition in the phone and tablet lines from Android-based products from Samsung Electronics Co Ltd and others.

Here are some ETFs that fit the bill for either broad or focused investments in the sector:

– Guggenheim S&P 500 Equal Weighted Technology ETF

Unlike most capitalization-weighted indexes that load up on the most popular – and overvalued – stocks, this fund reduces individual holdings to under 2 percent per stock. It includes leading hardware companies like Western Digital Corp and Seagate Technology Plc and software giant Symantec Corp. As a result, it is outperforming the general sector and is up 6 percent year-to-date through January 30.

– First Trust Dow Jones Internet Index

For a more specialized play that focuses on online companies, this fund covers a smaller slice of the tech sector. Internet mainstays including Google Inc, Amazon.com Inc and Yahoo Inc are all represented. This is a worthy consideration if you are banking on the trend that online retailers and advertising will continue to take business from the bricks-and-mortar world. The fund is up nearly 9 percent year-to-date.

– T. Rowe Price Science & Technology Fund

An actively managed fund that is up 5 percent year-to-date, science and technology offers a diverse mix ranging from the Chinese Internet firm Baidu Inc to the game company Nintendo Co Ltd.

For more from John Wasik see

(Reuters) – A gauge of planned U.S. business spending recorded its largest increase in more than a year in January, suggesting growing confidence in the durability of the economic recovery.

The case for the economy’s resilience was further bolstered by another report on Wednesday showing that contracts to buy previously owned homes approached a near three-year high last month. Housing is expected to underpin growth this year.

Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, jumped 6.3 percent, the biggest gain since December 2011. These so-called core capital goods orders had slipped 0.3 percent in December.

“The encouraging tone of this report suggests that the business sector is beginning to feel sufficiently confident about the improving economic outlook to commit to investment activity,” said Millan Mulraine, a senior economist at TD Securities in New York.

In a separate report, the National Association of Realtors said its pending home sales index increased 4.5 percent to its highest since April 2010, just before a home-buyer tax credit expired.

The rise in signed purchase contracts, which become sales after a month or two, added to data such as building permits and house prices that have suggested a decisive turnaround in the housing market.

Home building added to growth last year for the first time since 2005 and economists expect another contribution this year.

Still, the reports are unlikely to change the Federal Reserve’s very easy monetary policy stance. Fed Chairman Ben Bernanke, testifying before Congress for a second straight day, pointed to the pick-up in housing as a sign the U.S. central bank’s aggressive easing of monetary policy is gaining traction.

However, he signaled a willingness to press forward with efforts to spur an even stronger recovery and lower the jobless rate, which remains at a lofty 7.9 percent.

Stocks on Wall Street ended more than 1 percent higher on the data and Bernanke’s comments, with the Standard & Poor’s 500 posting its best daily percentage gain since January 2. The U.S. dollar weakened against a basket of currencies, while prices for U.S. government debt fell.

FACTORY ACTIVITY COOLING

Although shipments of core capital goods, used to calculate equipment and software spending in the government’s measures of gross domestic product, fell last month, economists were little worried.

“The balance between orders and shipments of capital goods is looking healthier as backlogs of core capital goods orders rose for the first time in eight months,” said John Ryding, chief economist at RDQ Economics in New York.

“Our take is that manufacturing activity – especially in the capital goods area – is bouncing back after cautious behavior ahead of the fiscal cliff.”

U.S. factory activity, which helped lift the economy from recession, has cooled in recent months, held back by sluggish domestic demand, tighter fiscal policy in Washington and slowing global growth.

While business investment plans looked strong, the report showed that overall orders for durable goods – items ranging from toasters to aircraft that are meant to last three years or more – tumbled 5.2 percent as demand for civilian and defense aircraft collapsed. It was the first drop since August.

Orders for civilian aircraft, which are very volatile and which tend to fall at the start of the year, dived 34 percent.

Boeing received orders for only 2 aircraft, down from 183 in December. Economists said the decline was probably not related to the grounding of Boeing’s 787 Dreamliners after problems with overheating batteries.

“I haven’t heard any reports about airlines canceling their orders. This could be a one-month lull rather than something greater,” said Stephen Stanley, chief economist at Pierpont Securities in Stamford, Connecticut.

Defense aircraft orders plunged 63.8 percent after soaring 58.5 percent in December, likely as orders were pushed forward ahead of $85 billion in government-wide spending cuts set to kick in on Friday.

Overall defense capital goods orders plummeted 69.5 percent in January, the sharpest fall since July 2000.

But durable goods orders excluding transportation increased 1.9 percent last month, also the largest gain since December 2011, after increasing 1 percent in December. That was a sign factory activity continues to plod along.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman and James Dalgleish)

(Reuters) – Consumer sentiment rose in February as Americans were more optimistic that the jobs market will improve, even as confidence in fiscal policy was near all-time lows, a survey released on Friday showed.

The Thomson Reuters/University of Michigan’s final reading on the overall index on consumer sentiment rose to 77.6 from 73.8 in January, topping expectations for attitudes to hold steady with February’s preliminary reading of 76.3.

Fewer Americans expected unemployment to rise, with survey respondents feeling slightly better about prospects for the economy. At the same time, 43 percent considered government economic policies to be poor and just 15 percent said the administration was doing a good job.

“Consumers find the blame-game for policy inaction a very unsatisfactory substitute for a concerted effort to improve the economy,” survey director Richard Curtin said in a statement.

Government spending cuts of $85 billion are set to start coming into force by the end of the day unless a last minute deal is reached in Washington, though few expect there will be one.

The barometer of current economic conditions rose to 89 from 85, while the gauge of consumer expectations gained to 70.2 from 66.6. All three consumer indexes were at their highest levels since November.

Worries about income growth and their weakened financial situations have made consumers more sensitive to inflation concerns. One-in-five respondents cited rising prices when asked about how their finances had recently changed.

The survey’s one-year inflation expectation was unchanged at 3.3 percent, while the survey’s five-to-10-year inflation outlook edged up to 3 percent from 2.9 percent.

(Reporting by Leah Schnurr; Editing by Chizu Nomiyama)

(Reuters) – The pace of growth in the U.S. manufacturing sector picked up to its fastest rate in over a year and a half in February as new orders continued to accelerate, an industry report showed on Friday.

The Institute for Supply Management (ISM) said its index of national factory activity rose to 54.2 from 53.1 in January, topping economists’ forecasts for a pullback to 52.5. It was the highest level since June 2011.

A reading above 50 indicates expansion in manufacturing. The sector lost traction in the second half of last year and contracted in November in the wake of the massive storm that hit the U.S. Northeast.

The new orders index jumped to 57.8 from 53.3, making for the highest level since April 2011. The gauge of production gained to 57.6 from 53.6, while inventories edged up to 51.5 from 51.

But the employment component slipped to 52.6 from 54.

In a sign of potential pressures emerging for companies, the prices paid index rose to the highest in a year to match 61.5 seen in February 2012, up from 56.5.

(Reporting by Leah Schnurr)