Teenage striker Raheem Sterling last night pledged his long-term future to Liverpool after agreeing a new five-year deal.
Meanwhile, the Reds and Merseyside rivals Everton are leading the chase for Birmingham City and England keeper Jack Butland.
Mario Balotelli has backed down in his row with Manchester City in a bid to salvage his career.
Adel Taarabt has pledged his future to QPR despite interest from Barcelona and Anzhi Makhachkala.
Wigan boss Roberto Martinez is in talks with Manchester United about signing the Old Trafford club's Chilean striker Angelo Henriquez, 18, on loan.
Crystal Palace boss Ian Holloway is eyeing up Bristol City winger Albert Adomah as a replacement for Wilfried Zaha who is the January target of several clubs in the Premier League.
Championship leaders Cardiff City want to sign right-back John Brayford from Derby County in a £1m deal.
Aston Villa boss Paul Lambert could make a £2m bid for 29-year-old Crystal Palace striker Glenn Murray.
West Ham are lining up a £2m January move for Southampton winger Jason Puncheon and could also sign Seattle Sounders midfielder Osvaldo Alonso, 27, who has impressed during trials this week.
West Brom have told Millwall and Brighton that they want £1.5m for 21-year-old New Zealand striker Chris Wood, currently on loan at the Lions.
Striker Andy Carroll - currently on loan at West Ham - wants to return to Newcastle after being told his Liverpool career is over.
Sir Alex Ferguson has warned Chelsea and Manchester City that former Barcelona boss Pep Guardiola has no interest in a return to management at present, after being linked with both Premier League clubs.
West Ham, QPR and Wigan are all competing to sign former Chelsea striker Salomon Kalou in a £3.3m deal from French side Lille.
Once Chelsea offload Daniel Sturridge to Liverpool, they will embark on a £100m spending spree, with Porto star Joao Moutinho, Everton midfielder Marouane Fellaini and Atletico Madrid’s goal sensation Falcao all in the Blues' sights.
Sunderland are set to offload flop striker Ji Dong-Won to his former club Chunnam Dragons.
Daniel Sturridge's £12m move to Liverpool could be in jeopardy following a dispute between Chelsea and the player's advisors over agents' fees, with the Reds eyeing up PSG's Kevin Gameiro should the Sturridge deal break down.
Manchester City's Samir Nasri, 25, is struggling to be fit for any part of City's Christmas and New Year programme after the extent of the Frenchman's groin injury was diagnosed.
Newcastle are looking to sign Ajax's Netherlands U21 international striker Jody Lukoki, 21, who is valued at £3.5m.
Arsenal and Liverpool have been put on alert after Anderlecht told their Argentinian midfielder Lucas Biglia he can leave the club.
Manchester City are eyeing a move for Colombian defender Pedro Franco, who plays for Millionarios.
Mario Balotelli has backed down in his battle with Manchester City because he wants to save his career at the Etihad.
Barcelona could look to bring back coach Pep Guardiola - a reported target for Chelsea and Manchester City - after current boss Tito Vilanova suffered a relapse on the cancer in his saliva glands.
Aston Villa are looking to sign Manchester City striker John Guidetti, 20, on loan for the rest of the season but face competition for the Swede from Sunderland.
Mario Balotelli has attempted to save his Manchester City career by belatedly accepting a club fine.
Spurs boss Andre Villas-Boas has held a lengthy meeting with his defenders over putting a stop to the number of late goals Tottenham have conceded this season.
QPR are holding talks with out-of-favour Marseille striker Loic Remy, who has only started two league games this season.
Raheem Sterling has committed his future to Liverpool by signing a new long-term contract.
Manchester City's Mario Balotelli has backed down from his decision to challenge a £340,000 club fine.
England midfielder Jack Wilshere was one of five Arsenal players to agree new long-term contracts with the club yesterday.
Loic Remy has hinted he would welcome a move to Newcastle in January.
Derby County have placed a £5million price tag on midfield sensation and Liverpool and Arsenal target Will Hughes.
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