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Republicans yielded on policy affecting communist Cuba and Democrats gave way on new energy standards for light bulbs to seal an agreement Thursday evening on a massive $1 trillion-plus year-end spending package in time avert a possible government shutdown this weekend.

Under pressure from White House veto threats, House Republicans agreed to drop restrictions on people who visit and send money to relatives in Cuba, while Democrats conceded defeat on a GOP demand to delay energy efficiency standards that critics argued could effectively ban inexpensive incandescent light bulbs. In late stage talks, Democrats also agreed to ban the District of Columbia’s government from funding abortions.

These policy issues held up a final agreement on the must-do spending measure for most of the day. It came barely a day after Republicans said they planned to push the 1,200-plus-page legislation through the House with only GOP votes, which seemed like a bluff considering tea party opposition to the measure.

The measure funds 10 Cabinet agencies, awarding a slight increase to the Pentagon and veterans’ programs while trimming most other domestic agencies. It drops most policy provisions sought by GOP conservatives.

Thursday’s legislation implements the details of cost caps set under the August debt and budget accord between Republicans and President Barack Obama and adds to earlier agency savings enacted in April. It pays for programs ranging from border security to flood control to combating AIDS and famine in Africa.

The measure has bipartisan backing but is likely to encounter resistance from conservative tea party lawmakers seeking far more significant cuts to government agencies.

Days after saying that the measure was wrapped up, House Appropriations Committee Chairman Harold Rogers, R-Ky., acknowledged that talks had been reopened, as power lawmakers quarreled over the Cuba provisions and other unresolved issues.

The bill chips away at the Pentagon budget, foreign aid and environmental spending but boosts funding for veterans programs. The Securities and Exchange Commission, responsible for enforcing new regulations under last year’s financial overhaul, won a 10 percent budget increase, even as the tax-collecting IRS absorbs more than a 3 percent cut to its budget.

Popular education initiatives for special-needs children and disadvantaged schools were basically frozen and Obama’s cherished “Race to the Top” initiative, which provides grants to better-performing schools, would absorb more than a 20 percent cut. The maximum Pell grant for low-income college students would remain at $5,550, but only after major cost-cutting moves that would limit the number of semesters the grants may be received and make income eligibility standards more strict.

Environmentalists scored clear wins in stopping virtually every significant GOP initiative to roll back Environmental Protection Agency rules. Most importantly, industry forces seeking to block new greenhouse gas and clean air rules, as well as a new clean water regulation opposed by mountaintop removal mining interests, were denied. But Republicans succeeded in blocking new energy efficiency standards for light bulbs and won delays to a new Labor Department rule requiring a reduction of coal dust responsible for black lung disease.

Drafted behind closed doors, the proposed bill would provide $115 billion for overseas security operations in Afghanistan and Iraq but give the Pentagon just a 1 percent boost in annual spending not directly related to the wars, though creative accounting such as mixing war funds with the core Defense Department budget is allowing billions of dollars more into Pentagon coffers.

The Environmental Protection Agency’s budget would be cut by 3.5 percent. Foreign aid spending would drop and House lawmakers would absorb a 6 percent cut to their office budgets.

And with tensions plain in the U.S.-Pakistan relationship, counterinsurgency aid for Pakistan would be cut to $850 million from Obama’s $1.1 billion request. All told, $11.2 billion in emergency foreign aid funding would be provided for counterterrorism, humanitarian aid and training of Iraqi security forces, among other anti-terror activities.

The measure generally consists of relatively small adjustments to thousands of individual programs. Agencies like the Border Patrol and Immigration and Customs Enforcement will get a boost within the Homeland Security Department, while GOP defense hawks won additional funding to modernize the U.S. nuclear weapons arsenal. The troubled, over-budget, next-generation F-35 fighter plane program would be largely protected.

Social conservatives won a ban on government-funded abortions in Washington, D.C., and restored a longstanding ban on funding for needle exchange programs used to prevent the spread of HIV. But efforts to take away federal funding for Planned Parenthood failed, as expected.

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Wall Street is pointing higher after 23 European nations agreed to tie their economies closer together in hopes of heading off any future debt crisis.

Dow futures rose 0.5 percent to 11,999 before the market opened Friday. The broader Standard & Poor’s 500 futures are up 0.5 percent at 1,236.

The 23 countries, 17 euro zone nations and six prospective members, will try to craft a new treaty that will penalize budgetary offenders that threaten the bloc.

The rising futures are following stock indexes higher in Europe, though they were down from their daily peaks. Germany’s DAX is up 1.5 percent at 5,963 while the CAC-40 in France rose 1.7 percent to 3,148. The FTSE 100 index of leading British shares is 1.1 percent lower at 5,484.

The euro is also trading 0.3 percent higher at $1.3384.

Germany and France, the two biggest economies in the eurozone, had hoped to persuade all 27 members of the European Union to back a change to the EU treaty that would impose tight fiscal rules on its members. However, Britain and three others refused to join in.

Many think that a solution to the debt crisis can only come if the European Central Bank takes a more active role, possibly by buying up more government debt in the markets. It currently buys bonds in the markets, but only reluctantly, and in small quantities.

On Thursday the European Central Bank’s president Mario Draghi suggested he had no intention of increasing bond purchases after the bank delivered on market expectations to reduce its main interest rate by a quarter percentage point to 1 percent fast cash loans.

Draghi said he was surprised by some interpretations of his comments last week that “additional steps” would be taken if the 17 countries that use the euro agreed to closer budget controls. Germany and France have proposed a plan on closer fiscal unity that will dominate debate at the EU summit of leaders, which starts later Thursday.

Earlier in Asia, stocks were weighed down by an cautious response to the deal.

Japan’s Nikkei 225 fell 1.5 percent to close at 8,536.46 while South Korea’s Kospi sank 2 percent to close at 1,874.75. Hong Kong’s Hang Seng tumbled 2.7 percent to end at 18,586.23.

Mainland Chinese shares fell less than other Asian markets after inflation data for November dropped to a less-than-expected 4.2 percent. The benchmark Shanghai Composite Index retreated 0.6 percent to close at 2,315.27, while the Shenzhen Composite Index lost 0.9 percent to finish at 961.81.

Oil prices were fairly subdued _ benchmark oil for January delivery rose 16 cents to $98.50 a barrel in electronic trading on the New York Mercantile Exchange.

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An early rally fizzled on the stock market Friday but still left the Standard & Poor’s 500 index up 7.4 percent for the week, its biggest gain since March 2009.

A surprise drop in the U.S. unemployment rate sent stocks higher in early trading, but the gains faded during the afternoon.

The Dow Jones industrial average dropped 0.61 of a point to close at 12,019.42. The Dow ended the week up 7 percent, the largest weekly gain since July 2009.

Bank stocks rose sharply, continuing a weeklong rally. JPMorgan Chase & Co. jumped 6.1 percent, the most among the 30 stocks in the Dow average. Morgan Stanley leapt 6.9 percent, the second-biggest gain of any stock in the S&P 500 index.

European stock indexes and the euro rose after German Chancellor Angela Merkel made a speech pushing for tighter rules on government spending. Merkel said the 17 countries that use the euro must quickly restore market confidence by making financial controls stricter.

Bond yields for Spain and Italy fell, a sign that investors are becoming more confident in the ability of those countries to pay their debt. France’s CAC-40 and Britain’s FT-SE each rose 1.1 percent.

Markets could be in for more volatility next week as European leaders prepare for a summit to propose new measures for containing the crisis.

The Labor Department reported before the market opened that the unemployment rate fell to 8.6 percent last month, the lowest level in 2 1/2 years. Economists had expected the rate to stay at 9 percent. But a key reason the unemployment rate fell so much was that more than 300,000 people gave up looking for work and were no longer counted as unemployed.

The Nasdaq composite index inched up 0.73 to 2,626.93. The Standard & Poor’s 500 index fell 0.31 of a point to 1,244.28. The S&P surged 7.4 percent over the week, the most since March 2009.

Decisive steps by world leaders to right Europe’s teetering economy sent stocks soaring on Wednesday. The Dow jumped 490 points, its biggest gain since March 2009 and its seventh-largest one-day point gain in history. The weekly point gain of 787 in the Dow was the second-biggest in its history, following a 946-point gain in October 2008.

“This market has been gripped with fear for a long time,” said Peter Cardillo, chief market economist at Rockwell Global Capital. “And I think some of these fear factors are beginning to dissipate.”

This week’s strong stock performance is partially a reflection of the market’s increased volatility since August, when concerns that Europe’s debt was spinning out of control made dramatic stock price swings the norm. On Monday the S&P 500 broke a 7-day slide that had taken the index down 7.9 percent.

The improvements in the U.S. job market are “another illustration that the US economy is, for now at least, shrugging off the global economic downturn and fears about the collapse of the euro-zone,” Capital Economics Chief U.S. Economist Paul Ashworth said in a note to clients.

Merkel and French President Nicolas Sarkozy will meet Monday to discuss changes to European Union treaties. The talks will culminate in a Dec. 9 summit of EU leaders, where the proposals are expected to be debated and detailed. Analysts say stricter controls on spending could encourage the European Central Bank to offer more short-term help for governments struggling with their debts.

If the European Central Bank takes a larger role in buying government debt, “it will certainly be a relief to markets,” Cardillo said, “and maybe even mean Europe avoids falling into a deep recession. Not that it’s going to cure all the problems of Europe.”

In corporate news:

_ Western Digital Corp. soared 7.5 percent, the most in the S&P. The data storage provider raised its revenue estimate for the current quarter and said that recovery efforts at its facility in Thailand following massive flooding there were proceeding faster than had been expected.

_ Big Lots Inc. slumped 8.7 percent, after the retailer reported a 76 percent plunge in income because of lower margins and a loss related to a newly acquired Canadian business. The company buys overstocked items including food and housewares and sells them at a discount.

_ H&R Block Inc. fell 6.4 percent. The country’s largest tax-preparation company reported a wider quarterly loss late Thursday. H&R Block also said there was a jump in claims tied to bad loans made by its former subprime mortgage unit.

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Jewelry seller Tiffany & Co. said Tuesday its fiscal third quarter profit rose 63 percent on strong sales globally, particularly in Asia.

The luxury retailer known for its iconic turquoise box is also raising its full-year forecast on the strong quarter.

Tiffany’s results show the luxury shopper is continuing to spend freely. That segment has rebounded more quickly from the recession than others. High-end jewelry sold better than other categories.

The New York company’s net income rose to $89.7 million or 70 cents per share in the three months ended Oct. 31. That compares with $55.1 million, or 43 cents per share, a year ago. Analysts expected earnings of 60 cents per share, according to FactSet.

Revenue rose 21 percent to $821.8 million. Analysts expected $801.8 million.

“Increased sales in all regions contributed to the continuation of strong worldwide sales growth in the third quarter,” said CEO Michael J. Kowalski.

In the Americas, sales grew 17 percent to $387.7 million. Revenue in stores open at least one year rose 16 percent.

The measure is considered a key gauge of a retailer’s financial health because it excludes stores that open or close during the year.

Tourists helped push the measure up 30 percent Tiffany’s the New York flagship store.

In Asia-Pacific, revenue rose 44 percent to $183.2 million, helped by strength in the greater China region.

Revenue rose 12 percent in Japan and 19 percent in Europe.

Tiffany now expects net income of $3.70 to $3.89 per share, for prior guidance of $3.65 to $3.75 per share. Analysts expect $3.72 per share.

Tiffany expects revenue to rise in the high-teens percentage for the year.

In the fourth quarter, the company expects net income of $1.48 to $1.58 per share. Analysts expect $1.63 per share.

Tiffany operates 243 stores globally..

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Yemeni President Ali Abdullah Saleh was in Saudi Arabia on Wednesday to sign a U.S.-backed power transfer deal mediated by Gulf Arab states to resolve the impoverished country’s crisis, Yemen’s state television reported.

Saleh has repeatedly promised to sign the Gulf-brokered agreement, only to change his mind every time. Under the deal, Saleh would step down and transfer power to the vice president in exchange for immunity from prosecution.

The TV said Saleh arrived in the Saudi capital Riyadh on Wednesday morning but did not say when the deal would be signed. It said that along with Gulf Arab representatives who sponsored the agreement, European and American envoys would also attend the signing.

Saleh has clung to power despite an 8-month-old uprising, mass protests calling for his ouster and a June assassination attempt that left him badly wounded and forced him to travel to Saudi Arabia for more than three months of hospital treatment.

But things appeared to be shifting on Tuesday, when the U.N. secretary-general’s envoy to Yemen, Jamal bin Omar, said all parties had agreed on a plan that would have Saleh step down.

“All parties agreed today on the Gulf initiative and the implementation of its mechanism,” bin Omar said after meetings with Yemen’s vice president, Abed Rabbo Mansour Hadi, in Sanaa.

Security in Yemen has unraveled amid the uprising against Saleh’s 30-year reign. The situation is particularly bad in the south, where al-Qaida militants _ from what is perhaps the world’s most active branch of the terror network _ have taken control of entire towns, using the turmoil to strengthen their position.

The unarmed protesters have held their ground with remarkable resilience, flocking to the streets of Sanaa and other Yemeni cities and towns to demand reforms from the autocratic government and braving a violent crackdown by government forces that has killed hundreds.

But their uprising, inspired by other Arab revolts in the region that saw longtime rulers of Egypt and Tunisa go, has at times been hijacked by Yemen’s two traditional powers _ the tribes and the military _ further deepening the country’s turmoil.

Breakaway military units and tribal fighters have been battling in Sanaa with troops loyal to Saleh, in fighting that has escalated in recent months.

An impoverished nation of some 25 million people, Yemen is of strategic value to the United States and its Gulf Arab allies, particularly Saudi Arabia. It sits close to the major Gulf oilfields and overlooks key shipping lanes in the Red and Arabian seas.

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A top U.S. tech analyst is predicting Amazon is likely to launch its own under-$200 smartphone by next year.

And Amazon could sell the device for $170 U.S. or less, said Citigroup analyst Mark Mahaney.

It would be the second head-on Amazon assault on Apple, right after the launch of the iPad tablet competitor Kindle Fire in the United States.

Mahaney based his prediction

By the third time around, it really shouldn’t be a surprise. The latest “Call of Duty” video game set a first-day sales record this week, generating $400 million in sales in its first 24 hours in stores. That breaks the record its predecessor set this time last year.

“Call of Duty: Modern Warfare 3″ is the third game in the military shooter series to set such a record. Last year, “Call of Duty: Black Ops” raked in $360 million in its first 24 hours on sale. “Call of Duty, Modern Warfare 2,” sold 4.7 million copies in its first 24 hours to reap $310 million

The latest installment of the game from Activision Blizzard Inc. went on sale at midnight Tuesday in North America and the U.K.

Activision said Friday the game sold 6 faxless payday advance.4 million units in its first 24 hours.

A rival shooter game from Electronic Arts Inc., “Battlefield 3,” meanwhile, sold 5 million units in its first week in stores last month, making it the fastest-selling game in EA’s history.

The figures show there’s a big appetite for big shooter games this holiday season, boding well for their publishers and retailers such as GameStop Corp.

Shares of Activision Blizzard slipped 16 cents to $12.82 in morning trading Friday.

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ROME

Greece’s embattled prime minister and main opposition leader agreed Sunday to form an interim government to ensure the country’s new European debt deal and oversee early elections, capping a week of political turmoil that saw Greece facing a catastrophic default and threatening its euro membership.

Greek leaders had been anxious to end a severe political crisis with some positive result before Monday, when the country heads to a meeting of eurozone finance ministers in Brussels. The initial agreement, which will see Prime Minister George Papandreou step down, came after a week of drama sparked by his announcement he was taking the debt deal to a referendum. He withdrew that plan Thursday after intense opposition from European leaders and his own Socialist lawmakers, many of whom called for him to resign.

Papandreou “has already stated he will not lead the new government,” the statement from the president’s office said.

He is to meet again Monday with opposition leader Antonis Samaras to seek agreement on who will head the new government and who will be included in its Cabinet, the president’s office said.

A planned meeting with the leaders of all political parties represented in parliament, which was to take place Monday evening, was canceled after parliament’s two leftist parties refused to attend, the office said.

The statement came after a late-night meeting between Papandreou and Samaras called by President Karolos Papoulias to end a two-day deadlock. Direct talks had failed to get off the ground as Papandreou had agreed to step aside but only after power-sharing talks settled on a new government makeup, and Samaras insisted he wanted snap elections and would not start negotiations unless Papandreou resigned first.

An opposition conservative party official said Samaras’ party is “absolutely satisfied” with the outcome of the talks and that party officials were to hold meetings late Sunday night with Finance Minister Evangelos Venizelos and his advisers to discuss how long it would take to finalize the new debt deal and when elections could be held.

“Our two targets, for Mr. Papandreou to resign and for elections to be held, have been met,” the official said, speaking on condition of anonymity to discuss the process.

The crisis was sparked after Papandreou’s shock announcement on Oct. 31 that he wanted to put a new European debt deal aimed at rescuing his country’s economy to a referendum. That plan caused an uproar in Europe, with the leaders of France and Germany saying any popular vote in Greece would decide whether the country would remain in the euro direct payday lenders. European officials also said the country would not receive the vital euro8 billion euro installment of its existing euro110 billion bailout until the uncertainty in Athens was over.

Papandreou’s announcement also spooked international markets, leading stock markets to tumble and led to calls in Greece for Papandreou’s resignation _ even from among his own Socialist lawmakers and ministers _ with many saying he had endangered Greece’s bailout.

The prime minister withdrew the referendum plan on Thursday, after Samaras indicated his party would back the new debt deal, which was agreed upon after marathon negotiations in Europe on Oct. 27.

Greece has been surviving since May 2010 on its initial bailout. But its financial crisis was so severe that a second rescue was needed as the country remained locked out of international bond markets by sky-high interest rates and facing an unsustainable national debt increase.

The new European deal, agreed on by the 27-nation bloc on Oct. 27 after marathon negotiations, would give Greece an additional euro130 billion ($179 billion) in rescue loans and bank support. It would also see banks write off 50 percent of Greek debt, worth some euro100 billion ($138 billion). The goal is to reduce Greece’s debts to the point where the country is able to handle its finances without relying on constant bailouts.

Greece’s lawmakers must now approve the new rescue deal, putting intense pressure on the country’s leaders to swiftly end the political crisis so parliament can convene and put the debt agreement to a vote.

“We know that there can be no elections now,” Papandreou had said during an earlier emergency Cabinet meeting, noting that snap polls would delay the approval of the new debt deal. “This cooperation, however, is necessary and will be beneficial for the climate in our country and internationally.”

In return for bailout money, Greece was forced to embark on a punishing program of tax increases and cuts in pensions and salaries that sent Papandreou’s popularity plummeting and his majority in parliament whittled down from a comfortable 10 seats to just three.

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Associated Press writer Nicholas Paphitis in Athens contributed to this report.

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A Republican-led House panel on Thursday agreed to subpoena the White House for documents related to Solyndra Inc., the failed California solar company that received a half-billion-dollar federal loan. A House Energy and Commerce subcommittee voted 14-9 along party lines to authorize subpoenas of top White House officials. GOP lawmakers say the subpoenas are necessary because the White House has denied or delayed requests for thousands of documents related to Solyndra.

The Fremont, Calif., company received a $528 million federal loan before filing for bankruptcy protection and laying off 1,100 workers.

Rep. Fred Upton, chairman of the House Energy and Commerce Committee, said getting White House documents on Solyndra was like “extracting a tooth without anesthesia” — painful and time-consuming.

“I wish it had not come to this, but it has,” said Upton, R-Mich., who called the White House “downright obstructionist” on Solyndra.

Democrats called the solar loan subpoena an overreach.

Rep. Diana DeGette, D-Colo., called the vote “an act of irresponsible partisanship” and a “political sideshow” that obscures the real issues in the Solyndra debacle.

DeGette and other Democrats said the vote amounted to a “fishing expedition” that grants Upton broad powers to issue subpoenas as he sees fit.

It was the second time in two days that a House panel authorized a subpoena of administration documents. On Wednesday, a House Judiciary subcommittee authorized its chairman to subpoena Department of Homeland Security documents on deportations of illegal immigrations.

Upton, who met with White House Counsel Kathryn Ruemmler on Wednesday, said he will take into account recent White House attempts to provide the committee with documents as he considers whether to issue a subpoena.

White House spokesman Eric Schultz said the Obama administration was disappointed in the GOP vote, adding that committee leaders have “refused to discuss their requests with us in good faith,” instead choosing “a partisan route, proceeding with subpoenas that are unprecedented and unwarranted.”

Schultz said the administration has “cooperated extensively” with the committee’s investigation by producing more than 85,000 pages of documents, including 20,000 pages produced Wednesday. Administration officials also have participated in multiple briefings and hearings on Solyndra, he said.

“All of the materials that have been disclosed affirm what we said on Day One: This was a merit-based decision made by the Department of Energy,” Schultz said. “We’d like to see as much passion in House Republicans for creating jobs as we see in this investigation.”

Rep. Henry Waxman, D-Calif., the energy panel’s senior Democrat and former chairman, said a subpoena can only be justified if Congress and the executive branch have reached an unbridgeable impasse, which he said he didn’t see.

“Apparently what the committee really wants is a confrontation with the president, not information,” Waxman said.

But Rep. Cliff Stearns, R-Fla., chairman of the energy panel’s subcommittee on oversight and investigations, said an impasse had been reached.

“The administration seems to think that if they drag this out, we will give up and simply go away. But we won’t,” Stearns said.

Congressional Republicans have been investigating Solyndra’ s bankruptcy amid embarrassing revelations that federal officials were warned it had problems but nonetheless continued to support it and sent President Barack Obama to visit the company and praise it publicly.

Energy Secretary Steven Chu, who is scheduled to testify before the full committee later this month, acknowledged Thursday the loan program needed work but said he wasn’t “ready to throw in the towel on clean energy.”

Chu, speaking at an energy conference held by The Washington Post, said, “There is no reason to sit on the sidelines and concede on clean energy.” But, he noted, Congress and the administration “can design a better loan program.”

Among the 1,200 pages of documents the administration released Wednesday were details of a bailout plan considered by the Energy Department that would have provided an infusion of cash to Solyndra and part-ownership of the company by the government.

Officials rejected the plan, which was recommended in August by the investment banking firm Lazard Ltd. Lazard was paid $1 million for analyzing options related to Solyndra.

Without an infusion of new cash, Lazard wrote in an Aug. 17 memo to the Energy Department, Solyndra was almost certain to fail, which would “likely result in little recovery to the DOE.” The department rejected the refinancing plan sometime after Aug. 28, and Solyndra shut its doors on Aug. 31.

The White House announced last week it had ordered an independent review of similar loans made by the Energy Department. The review by former Treasury official Herb Allison will assess the health of more than two dozen other renewable energy loans and loan guarantees made by the Energy Department program that supported Solyndra.

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