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Mediobanca shares were up 2.8 percent by 1412 GMT,outperforming a 1.9 percent fall in the European banking index, as analysts welcomed the capital gains as well ashigher deposits at its retail bank CheBanca! and lower costs.

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One source, who spoke on the condition of anonymity but wasfamiliar with the latest merger, said that the discussionsbetween the firms had been ongoing for months and that Orrick isexpected to sign the letter of intent sometime next week.

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With the point-counterpoint out of the way, the larger issue is Microsoft's hardware partners since they're selling the lion's share of Windows devices. And they have flooded the market with their own 2-in-1 designs.

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TOKYO, Oct 29 (Reuters) - Brent crude edged lower toward$109 a barrel on Tuesday ahead of a Federal Reserve policymeeting but kept most of the previous day's gains after reportsof a sharp drop in Libyan oil exports, which rekindled worriesover supply.

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While Caterpillar, Komatsu and Volvo AB remaindominant in most emerging economies, Chinese gear is makinginroads. In 2011, XCMG group won a $745 million bid to supplycranes, concrete pumps, excavators and other equipment for ahousing project in Venezuela that Caterpillar also bid for.

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Lewis Hamilton, the 2008 world champion, compared this season to his recollection of the Schumacher era as one in which European fans woke up to watch faraway races, turned the television on, saw Vettel was leading and went back to bed.

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Investigators determined the couple, both 20-year-old students, had alcohol from a bar before the sex act, Blackburn said in a statement Monday. Blackburn said the man asked the woman whether to stop the act when a crowd formed, and she said no.

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Treasury has since whittled down its stake in GM through aseries of stock sales. Those sales have all taken place belowthe price Treasury needed to break even on its GM investment,resulting in the loss, according to Tuesday's report from theSpecial Inspector General overseeing the $700 billion TroubledAsset Relief Program.

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Traders also said the dollar's latest drop, which took it toa nine-month low against a basket of currencies on Friday, mayhave been overdone. But sentiment remains negative and investorswill likely see any rebound as a selling opportunity.

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After opening in line with Asian markets' gains, Europe'smain indexes had turned lower by midday, reflecting a more mixedset of corporate earnings announcements and the caution over therecent run up.