PREPARATION:

1. Combine milk, water and yeast in large bowl. Let stand 5 minutes. Stir in 2-3/4 cups flour, egg, butter, granulated sugar and salt, stirring until soft dough forms.
2. Knead in enough remaining flour on lightly floured surface until dough is smooth and elastic (5 to 8 minutes). Place in bowl coated with cooking spray. Turn dough to coat surface with nonstick cooking spray. Cover loosely with plastic wrap. Let rise in warm place 45 to 60 minutes or until doubled in bulk.
3. Punch dough down. Cover and let rest in warm place 10 minutes. Lightly coat baking sheet with cooking spray; set aside.
4. Roll dough into 16x9-inch rectangle on lightly floured surface. Stir together preserves and orange peel. Spread over dough. Starting with long side, roll up dough; pinch seam to seal. Form dough into ring on prepared baking sheet, keeping seam side down and pinching ends together.
5. Use serrated knife to cut slices three fourths of the way through dough every inch. Slightly twist each section of the dough out, forming many rings. Loosely cover with plastic wrap. Let rise in warm place 30 to 45 minutes or until doubled in bulk.
6. Preheat oven to 350°F. Bake ring about 25 minutes or until light brown. Remove from pan. Cool completely on wire rack.
7. Combine powdered sugar and orange juice in small bowl. Drizzle evenly over bread. Cut into 16 slices to serve.