** EU & ASIAN WRAP **

** ASIAN HEADLINES **
– Asian Stocks Rise to Highest in Almost 10 Years, Led by BHP and Newcrest
- Morgan Stanley’s China Head Zhu to Join Bain Capital, People Familiar Say
- Coal Prices May Drop From Record, Cutting Utility Costs, on Rising Exports
- Malaysia’s November Industrial Production Has Biggest Gain in Nine Months
- Taiwan’s Exports Probably Rose in December on Electronics, Weaker Currency
- Air India, Indian Oil May Lead Extension of Last Year’s Record Stock Sales
- India’s Sensex May Exceed 10,000 as Overseas Investors Flock to Buy Shares
- Australia’s Retail Sales Unexpectedly Declined 0.1 Percent in November
- Toyota, Nissan, Honda to Release Record Number of New Models in the U.S.
- Toyota’s Profitable U.S. Dealers Help Widen Edge Over Ford, General Motors

Yen Advances to ThreeMonth High; Tanigaki Suggests Unconcerned About Gain
- India, China Need to Cooperate on Energy, Indian Oil Minister Aiyar Says

** EU HEADLINES **
- Trichet, G-10 May Signal Confidence, Raising Expectations for Higher Rates
- BP, European Energy Stocks May Become Market Leaders Again as Oil Recovers
- Euronext IPOs Outweigh London, Frankfurt in Fourth-Quarter, PwC Study Says
- Bank of England Will Probably Keep U.K. Rate at 4.5 Percent, Survey Shows
- U.K. Financial Services Expect Profitability Growth to Slow, Survey Shows
- Marks & Spencer, Sainsbury May Lead Reports of Gains in U.K. Holiday Sales
- Bundesbank’s Weber Emerges as a Leader of ECB Council’s Rate-Rise Hawks
- Euro May Rise After ECB’s Wellink Says Interest Rate Rises More Likely
- Shell, BP Were Top Crude Oil Tanker Hirers in 2005 as Oil Rose to Records
- Duke Street Plans $1 Billion Buyout Fund, Hires Permira’s Troup as Partner

** EU STOCKS IN PLAY **

- Boots Group Plc (BOOT LN): The U.K. drugstore operator may say
this week that it had the biggest sales decline since January 2001,
the Sunday Telegraph reported, without citing anybody.

- Compass Group Plc (CPG LN): The world’s largest caterer’s
departing Chief Executive Mike Bailey and Chairman Francis Mackay
raised their pensions by more than 1 million pounds each ($1.8
million) at a time when the company is battling a 532-million pound shortfall in its staff retirement program, said the Sunday Times.

- DaimlerChrysler AG (DCX GY): The Chrysler unit of the world’s
fifth-biggest carmaker will recall 210,000 Dodge Stratus and similar
sedans from the 1999 and 2000 model years to fix power-steering
hoses, the company said.

- Deutsche Bank AG (DBK GY): Germany’s biggest bank wants to use
gains from property sales worth about 1 billion euros to prop up a
real-estate fund it froze amid a revaluation of its holdings,
Berliner Zeitung newspaper reported, citing unidentified officials.

-E.ON AG (EOA GY): Europe’s second-largest utility said Germany
can’t afford to phase out nuclear power because it lacks plans to
offset the resulting energy loss, Der Spiegel magazine reported,
citing E.ON Chief Executive Wulf Bernotat.

- GlaxoSmithKline Plc (GSK LN): The U.S. Food and Drug
Administration has approved the postmenopausal osteoporosis injection
Boniva, which was co-developed by Europe’s biggest drugmaker and
Roche Holding AG (ROG VX), the Swiss drugmaker.

- J Sainsbury Plc (SBRY LN): The third-largest U.K. supermarket
operator will announce this week that it had the biggest sales
increase since April 2002, the Sunday Telegraph reported, without
citing anybody.

- KarstadtQuelle AG (KAR GY): Germany’s biggest department-store
chain is scheduled to release 2005 full-year revenue figures.

- Novartis AG (NOVN VX): Switzerland’s biggest drugmaker has
completed its due diligence at Serono SA (SEO VX) and may agree on a
``deal’’ for the biotechnology company in the next 10 days, the
SonntagsZeitung said, citing unidentified people familiar with the
situation. Novartis ``retains a strong interest’’ in Serono after
examining the Geneva-based company’s books, the SonntagsZeitung said.

- Roche Holding AG (ROG VX): The shares of the world’s biggest
maker of cancer medicines may be active after shares of Genentech
Inc., the world’s second-largest biotechnology company, had their
biggest slump since October. Morgan Stanley analyst Steven Harr said
2006 sales of Genentech’s Avastin cancer drug may fall short of his
estimates. Genentech is majority-owned by Roche.

- Telefonica SA (TEF SM): Spain’s largest telephone company may be
active after French newspaper Les Echos reported Jan. 6 that
Telefonica may bid for Bouygues SA’s mobile-phone unit. Les Echos
cited a study by Oddo Securities first published on Nov. 1. Bouygues
said it has no plans to sell the phone business, following the report
in Les Echos.

- Volkswagen AG (VOW GY): Europe’s largest carmaker increased
global sales 3.2 percent in 2005 on growth in Western Europe, the
company said in a statement. Separately, Volkswagen posted a 20
percent record rise in global sales of commercial vehicles last year,
the company said.

- Adecco bids Eur 54.50 a share for German Staffing Co DIS ( Eur 636 mio).