1995 - 96: REVIEW AND OUTLOOK : THE GLOBAL PULSE: How international and selected regional indexes fared in 1995.

International investors who have been waiting for a revival from the two-year slump in many overseas stock markets had their patience tested again in the fourth quarter of 1995.

The battered Latin American markets, and smaller “emerging markets” around the world took another spill, while the more mature markets of Europe and the Pacific Rim were unable to make much progress.

Just about all foreign markets found themselves in the by-now-familiar position of trailing behind Wall Street, where the U.S. market was finishing off a banner year.

But some analysts think the picture could be different in 1996. Barton Biggs, the influential investment strategist at Morgan Stanley & Co. is downplaying U.S. stocks as he looks to “‘a more difficult year. I believe emerging Asia, Japan and the emerging markets will be the best performers in 1996,” Biggs says.

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Standard & Poor’s 500 Index: + 33.7%

North America: + 33.3%

Europe: + 18.6%

Pacific: + 1.5%

Emerging Markets Global Free: - 7.1%

Emerging Markets Free Latin America: - 15.0%

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9.2%: EAFE, 20 countries (14 European, 6 pacific)

18.5%: World, 22 countries (EAFE plus U.S. & Canada)

15.5%: All-country, 49 countries (World plus emerging mkts.)

* All above indexes from Morgan Stanley, except Standard & Poor’s 500. They do not include reinvestment of dividends and reflect trading for the year through December 28, 1995.