** MORNING WRAP **

** US MARKETS **
Dow 1,98%; Nasdaq 2,96%; S&P 2,16%; Soxx 3,99%; Russel2k 3,82%; DJAIG 1,46%;
10yr Bond 0,16%; 10yr Yield 5,17%; Crude future 73,72; Gold 601,75

| Materials 3,86%| Technology 2,68%| Energy 2,66%| Financials 2,19%| ConsDisc
2,11%| Industrials 2,03%| Healthcare 1,68%| ConsStaples 1,56%| Telecom 1,5%|
Utilities 1,27%

** US HEADLINES **
Stocks soared Thursday as investors rallied around the
idea that the Fed may finally take a breather after two years of interest-rate
increases.
- Fed, Looking for Guidance in Data, May Find Numbers Fail to Justify Pause
- General Motors Likely to Get U.S. Pension Waiver on GMAC Sale, People Say
- Personal Spending in U.S. Probably Ebbed in May, Price Pressures Mounted
- GM, Chrysler U.S. Sales Probably Dropped Most in June on Fewer Incentives
- Options Scandal Pushes Merrill, Citigroup Analysts to Uncover Next Probe
- Dollar Set for Quarterly Loss as Fed Near to End of Interest Rate Rises
- Calpine Bonds Rally on Rising Energy Prices, Six Months After Bankruptcy
- Treasuries Rise, Set for Winning Week, on Optimism Fed May Pause on Rates
- Pfizer to Visit Hundreds of Companies in $17 Billion Hunt for New Drugs

** US: IN PLAY TODAY **
- Research in Motion (+5.9% after hours) reported Q1 (May) earnings of $0.68 per
share, $0.04 better than the Reuters Estimates consensus and issued a in-line
guidance for Q2.

- Accenture (+3% after hours) Excluding non-recurring items, co reported Q3
(May) earnings of $0.50 per share, $0.04 better than the Reuters Estimates
consensus of $0.46. Revenues rose 6.8% year/year to $4.81 bln vs. the $4.43 bln
consensus.

- Apple (-2.8% after hours) announced that an internal investigation has
discovered irregularities related to the issuance of certain stock option grants
made between 1997 and 2001. One of the grants in question was to CEO Steve Jobs,
but it was subsequently cancelled and resulted in no financial gain to the CEO

- Palm (-9% after hours) Surpassing analysts’ expectations by six cents, Palm
reported Q4 (May) earnings of $0.29 per share, excluding non-recurring items.
Revenues rose 20.0% year/year to $403.1 mln vs. the $405.4 mln consensus. Co
issued downside guidance for Q1, sees EPS of 0.18-0.19 (consensus $0.22) on
revenues of $380-385 mln (consensus $412.40 mln).

- With the Feds focus still centered on “incoming” data and noting in its policy
directive today that “some inflation risks remain”, today’s Personal Income
and Spending data at 14:30 CET will be closely watched, with special emphasis
being placed on the core PCE deflator—a favored inflation measure among Fed
officials. With no notable earnings reports scheduled, other economic
data which could also impact trading include a revision to the University of
Michigan Sentiment at 15:50 CET and an update on regional manufacturing activity
when Chicago PMI hits the wires around 16:00 CET.

** ASIAN MARKETS **
Nikkei +2,43 Kospi +2,24 HSI +2,34 Taiwan +1,47 Thailand +1,98 Australia
+1,55%

** ASIAN HEADLINES **
- Japan’s Consumer Prices Rise the Most Since 1998, Supporting Rate Increase
- Veolia Agrees to Buy Brambles U.K. Trash Collection Unit for $1.1 Billion
- Asian Shares Rally as a Pause in U.S. Rate Increases Is Seen; Toyota Gains
- China Increases Electricity Prices to Compensate for Rising Cost of Coal
- Nomura Risks $148 Million Loss to Support Sale of Mitsubishi UFJ Shares
- Citigroup Had No Consent to Trade Patrick Stock, Australia Regulator Says
- China’s Yuan Rises to Highest Against U.S. Dollar Since July Revaluation
- Citigroup Chief Executive Prince Says He’s `Hopeful’ of Guangdong Purchase
- Shanghai Fake-Goods Market Closes as Lure of Property Offers Bigger Profit
- Taiwan Names New Finance Minister, Keeps Acting Bank Regulator in Place

** EUROPE: IN PLAY TODAY **

- Axa SA: Dolmea Real Estate SA, which was formed by
Europe’s second-largest insurer from some of its French
residential real-estate assets, scrapped its initial public
offering was to raise as much as 343 million euros the latest
victim of the decline in global stock markets.

- Berkeley Group Holdings Plc: The British builder
is scheduled to report preliminary fiscal full-year earnings.

- Mittal Steel Co.: The world’s largest steel company
is scheduled to hold an extraordinary shareholder meeting in
Rotterdam to discuss its proposed merger with Luxembourg’s
Arcelor SA.

- Siemens AG: Europe’s largest engineering company
will buy Bayer AG’s diagnostic division Bayer HealthCare for 4.2
billion euros. Bayer, which is buying rival Schering AG, expects
net proceeds of 3.6 billion euros from the sale.

- Telecom Italia SpA: Italy’s biggest telephone
company sold 57 properties to the Raissa fund for about 47
million euros, as part of a plan to cut debt by disposing of
assets.

** EUROPE: UPS & DOWNS **
+ CARREFOUR RAISED TO `NEUTRAL’ FROM `REDUCE’ AT UBS
+ HUNGARIAN STOCKS RAISED TO `OVERWEIGHT’ AT CREDIT SUISSE
+ HENNES & MAURITZ RAISED TO `NEUTRAL’ AT CREDIT SUISSE :HMB SS
+ Q-CELLS PRICE EST. RAISED 3.6% TO EU93.9 AT CREDIT SUISSE
+ DIAGEO FEB. 07 PRICE EST. RAISED TO 950P FROM 905P AT JPMORGAN
+ ENEL GIVEN NEW DEC. ‘06 PRICE ESTIMATE OF EU7.20 AT JPMORGAN

- EASYJET LOWERED TO `UNDERWEIGHT’ FROM `NEUTRAL’ AT HSBC
- CELESIO PRICE ESTIMATE LOWERED TO EU80 FROM EU86 AT UBS
- HANNOVER RE PRICE ESTIMATE CUT TO EU32 FROM EU35 AT UBS