The storm was inching toward the marshy Louisiana coast and was forecast to dump up to 20 inches of rain to southeast Louisiana over the next few days. The storm center was about 85 miles west-southwest of Morgan City, with maximum winds of 50 mph. Winds were expected to stay below the 74-mph (119-kph) threshold of hurricane strength as the storm crawls ashore.

In New Orleans, a major US tourist destination, the storm evoked memories of Hurricane Katrina, which flooded 80 percent of the city, killed 1,500 people and caused more than $80 billion in damage. Half the city, a major US tourist destination, lies below sea level and is protected by a system of levees and flood gates.

The levees had pumped away about 8 inches of rain so far, with isolated reports of flooding in roads and homes. The system can process about 1 inch of rainfall per hour, but the storm's slow-moving nature remained a worry, officials said. "Don't go to sleep on this storm," Mayor Mitch Landrieu told residents, warning stormy conditions could continue for the next 36 hours. New Orleans is under a flash flood watch through Monday night due to heavy rain potential, the National Weather Service said. Potential damage from wind gusts up to 50 mph will also be a concern for New Orleans on Sunday as Lee's center moves inland, it said.

Lee's tidal surge could spur coastal flooding in Louisiana, Mississippi and Alabama before drenching a large swath of the Southeast and Appalachian regions next week. Storm winds were already pushing Gulf waters inland, slamming barriers in low-lying areas and prompting mandatory evacuations in the coastal communities of Lafitte, Crown Point and Barataria. In Mississippi, local governments were taking precautions as forecasters predicted tides could be 2 feet to 4 feet above normal.

Financial, manufacturer and energy stocks suffered the biggest losses as declining issues far outweighed winners. Nonfarm payrolls generated no new jobs last month as sagging consumer confidence discouraged already skittish businesses from hiring, keeping pressure on the US Federal Reserve to provide more monetary stimulus to the economy.

Stocks had risen recently on hopes the Fed would introduce new stimulus after data reflected a weak economy, recouping 50 percent of the down move from a July high. However, some analysts said the Fed may be running out of bullets in its fight to stimulate the economy.

The debt crisis has been a tough test of endurance for Europe. To better face such challenges in the future, German Finance Minister Wolfgang Schauble wants to forge a new European Union treaty, the mass-circulation daily Bild reported Friday. According to the report, Schauble clarified his plan during a closed-door meeting of leaders of his conservative Christian Democratic Union (CDU) and its Bavarian sister party the Christian Social Union (CSU) on Thursday evening.

Shifting greater powers over economic and financial policy to Brussels is necessary, he said according to the paper, "even though we know how difficult a treaty change will be." Schauble also acknowledged that such reforms would create a significant divide between the 17 European Union countries that use the euro and the remaining 10 that do not.

The tsunami warning - which was quickly revoked - was in effect for coastal areas of Alaska from Unimak Pass to Amchitka Pass. The areas are very remote and not heavily populated, according to Jessica Sigala, geophysicist with the USGS in Golden, Colorado. The USGS says the earthquake struck in the waters at about 6:55 am EDT (1055 GMT), and there were no initial reports of injuries or damage.

The state emergency response center was being staffed early Friday morning. In June, an earthquake with a magnitude of 7.2 in the same area of the Aleutians also prompted a tsunami warning.

The Federal Housing Finance Agency suits, which are expected to be filed in the coming days in federal court, are aimed at Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank, among others, according to three individuals briefed on the matter. The suits stem from subpoenas the finance agency issued to banks a year ago. If the case is not filed Friday, they said, it will come Tuesday, shortly before a deadline expires for the housing agency to file claims.

The suits will argue the banks, which assembled the mortgages and marketed them as securities to investors, failed to perform the due diligence required under securities law and missed evidence that borrowers' incomes were inflated or falsified. When many borrowers were unable to pay their mortgages, the securities backed by the mortgages quickly lost value. Fannie and Freddie lost more than $30 billion, in part as a result of the deals, losses that were borne mostly by taxpayers.

Confirmation that Greece will miss its 2011 deficit target of 7.6 percent and uncertainty over Italy's commitment to austerity measures underscored unease about the single currency zone, prompting investors to shy away from riskier assets. The US employment report, due at 8:30 am EDT, is expected to show an increase of 75,000 jobs, down from 117,000 in July.

"I think the job figures are going to be worse than expected. It could be a wake-up call for the market and share prices could go down even further," said Koen De Leus, strategist at KBC Securities in Brussels. "Expectations of QE3 (another round of US quantitative easing) have helped shares in the past days, but at the end of the day, the market needs a better economic environment that stimulates growth and company results."

The Treaty divided the Sinai Desert into three zones:

In the western zone (closest to Egypt, bordering the Suez Canal), Egypt was limited to an "armed force of one mechanized infantry division and its military installations, and field fortifications."

In the central zone, they were limited to "border units of four battalions equipped with light weapons and wheeled vehicles [to] provide security and supplement the civil police in maintaining order... The main elements in the four Border Battalions will consist of up to a total of four thousand personnel."

In the eastern zone (bordering Israel), "only United Nations forces and Egyptian civil police will be stationed."

Israel's security was guaranteed by the 240 km (150 miles) distance that the Egyptian Army was to be kept from the Israeli border. Last Friday, as a response to the threat of Islamist terror cells throughout the Sinai Desert, Defence Minister Ehud Barak proposed that Egypt begin to remilitarize the Sinai Desert.

The report, commissioned by Nasa, says the quantity of hazardous material circling the Earth has reached a "tipping point" and poses a real and increasing danger to satellites and the International Space Station. It suggests developing a clean-up strategy, which could include catching debris with nets, magnets or giant umbrellas.

The US National Research Council was asked to review the space agency's meteoroid and orbital debris programmes last April following a request from the White House. Meteoroids are particles or larger lumps of rock in the solar system. "The current space environment is growing increasingly hazardous to spacecraft and astronauts," said Donald Kessler, chair of the committee responsible for the report and a retired head of Nasa's orbital debris programme.

Although Nasa had identified the need for removing debris, the agency and US government had not fully examined the economic, technological, political and legal considerations, the report added. "The longer you wait to do this the more expensive it's going to be. Given the economy, we'll probably end up putting it off, but that's really not very wise. This scenario of increasing space debris will play out even if we don't put anything else in orbit," Kessler said.

Gil Shaham was about to play Bruch's violin concerto conducted by Zubin Mehta when booing and shouting began. Michael Stern, who was in the audience, said: 'There were four to five disruptions at the beginning of each piece. The protesters started singing in the middle of the performance. It was obviously rehearsed. They were singing in tune to Beethoven's Ninth'.

'They are musicians not politicians, they are here to play. It's fair to make a protest outside but not to take it in. All of us paid good money to come here.' It is believed that around 40 protesters bought seats, which would have cost them around 20 pounds each. Radio 3 interrupted its live broadcast at 7.45pm before returning later. Coverage was cut off again an hour later following more protests.

Earlier the Palestine Solidarity Campaign had urged music lovers to boycott the concert and called for the BBC not to broadcast it.

One of the protesters, Professor Jonathan Rosenhead, of the London School of Economics, said: 'The orchestra is intimately connected with the Israeli state. We are saying not to forget the denial of human rights in Israel.' A BBC spokesman said: 'We regret that as a result of sustained audience disruption within the concert hall which affected the ability to hear the music, tonight's Israel Philharmonic Orchestra Prom was taken off air.'

Stephen Cecchetti and his team at the Bank for International Settlements have written the definitive paper rebutting the pied pipers of ever-escalating credit. "The debt problems facing advanced economies are even worse than we thought." The basic facts are that combined debt in the rich club has risen from 165% of GDP thirty years ago to 310% today, led by Japan at 456% and Portugal at 363%.

"Debt is rising to points that are above anything we have seen, except during major wars. Public debt ratios are currently on an explosive path in a number of countries. These countries will need to implement drastic policy changes. Stabilization might not be enough." Demographic atrophy and aging costs will make this even nastier. "Rising dependency ratios put further downward pressure on trend growth, over and above the negative effects of debt."

Let us not demonize all debt. It is the lubricant of progress. "Used wisely and in moderation, it clearly improves welfare. But, when it is used imprudently and in excess, the result can be disaster." And disaster we have. We must prepare for a long hard slog, for the rest of my life and yours.

The North East had the highest percentage of workless households, while the number of homes in which no adult has ever worked hit 370,000, up 18,000 from a year earlier. A total of 1.84 million, 15.8 per cent, of children live under the care of these workshy households.

Employment minister Chris Grayling said: "While the slight fall in the numbers of workless households and children living in workless households is encouraging, these figures still underline the sheer scale of the challenge we face. Over the last decade thousands of people were simply abandoned to a lifetime on benefits, and a staggering 1.84 million children are living in homes where currently no one works.

Data from the St Louis Fed shows that reserve funds from "official foreign accounts" have doubled since the start of the year, with a dramatic surge since the end of July when the eurozone debt crisis spread to Italy and Spain. "This shows a pervasive loss of confidence in the European banking system," said Simon Ward from Henderson Global Investors. "Central banks are worried about the security of their deposits so they are placing the money with the Fed."

These dollar accounts are just over $100 billion (62 billion pounds) and are small beer compared to the vast sums invested in bonds as foreign reserve holdings. Yet they serve as a stress indicator, reflecting the operating decisions of the world's top insiders. Lars Tranberg from Danske Bank said European banks are reduced to borrowing dollar funds for "a week at a time" rather than the usual six to 12 months. "This closely resembles what happened in late 2008, though the difference this time is that the major central banks have dollar swap lines in place. If the dollar funding markets completely freeze up, the European Central Bank can act as a backstop."

Simon Derrick from BNY Mellon said Germany, Holland, and Finland may balk at a third rescue in the current tetchy mood, implying bigger haircuts instead. That will set a precedent for Portugal, and others. Until markets can see an end to the blood-letting, Europe's banks will remain untouchables.

The French President and Prime Minister, who led the West's intervention, will use three hours of talks to focus on political and economic reconstruction in a bid to avoid the post-conflict chaos and mistakes made in Iraq. But talks on the sidelines may expose early jostling for opportunities in oil and infrastructure. Libya, which boasts Africa's largest reserves of top-quality crude oil, has been left badly underdeveloped by Gaddafi, who as a young army captain ousted Libya's King Idris on September 1, 1969, 42 years ago to the day.

The "friends of Libya" summit will give the rebel National Transitional Council (NTC) its first major international platform as the legitimate government of Libya. It has promised economic rewards for countries, such as Britain and France, which took a lead role in backing the revolt against Gaddafi. The French newspaper Liberation reported on Thursday that it had obtained a letter showing that the rebels had agreed to give France priority access to 35 per cent of Libya's oil.

A monthly European Commission survey showed economic sentiment in the 17 countries using the euro, a good indication of future economic activity, fell to 98.3 in August from a revised 103 in July with optimism declining in all sectors. Economists polled by Reuters had expected a fall to 100.5.

"The decline in sentiment clearly indicates that the euro zone economy has lost a lot of momentum. As a result, growth will probably remain very sluggish in the second half of the year, while the risks are tilted to the downside," said Aline Schuiling, economist at ABN AMRO Bank. The European Central Bank raised rates twice this year by 25 basis points each time to 1.5 percent but a worsening of the euro zone's debt crisis and economic outlook has prompted markets to price out any chance of further hikes for the foreseeable future.

Katia had sustained winds of 75 miles per hour and was the second hurricane of the June-through-November Atlantic hurricane season, the US National Hurricane Center said. The Miami-based center said Katia was forecast to become a "major" hurricane with winds over 111 mph by the weekend but it was too early to tell whether it would threaten land.

At 11 pm (0300 GMT Thursday), Katia was about 1,165 miles east of the Caribbean's Leeward Islands. It was moving rapidly west-northwest and was forecast to turn northwest in a couple of days on a course that would keep it away from the Caribbean islands. Hurricane Irene rampaged up the US East Coast over the weekend and authorities on the US Atlantic seaboard are keeping an eye on Katia to see which path it takes.

The Atlantic hurricane season typically brings 11 or 12 named storms. Katia is already the 11th, and with half of the season still ahead, it is shaping up to be the unusually busy year that was predicted.

Energy companies with oil and natural gas operations in the Gulf of Mexico were keeping watch on a mass of thunderstorms over the northwest Caribbean Sea and eastern Gulf. In an advisory issued late on Wednesday, the hurricane center said the disturbed weather system had a "high" chance of developing into a tropical cyclone in the next two days.