Today's Business Headlines

Surging spot prices put heat on China mills
Iron ore prices have soared almost 10 per cent since the arrest of Rio Tinto executive Stern Hu, adding pressure to China's steel mills to drop their staunch opposition and join Asian peers in accepting a 33 per cent cut to Pilbara benchmark prices. The West

World came close to collapse: bankers
ANZ chief executive Mike Smith lost faith in US regulators when they allowed Wall Street investment bank Lehman Brothers to fail, and he wondered at the time "if this was the end of the banking system as we know it". The Australian

Stokes buys up more of Packer's empire
The titanic tussle over James Packer's Consolidated Media empire continues in earnest with Channel 7 boss Kerry Stokes rumoured to have bought another $28.12 million worth of shares in the company. Daily Telegraph

China soothes Rudd on trade
China has reassured Australia about the bilateral economic relationship after Prime Minister Kevin Rudd yesterday stepped up concern over the Stern Hu detention by reminding Beijing it had big economic interests at stake in Australia and the world. The Fin Review

Ziggy remains in NBN race as Anderson ruled out
Former Optus chief executive Chris Anderson is out of the running for the chairmanship of the crucial national broadband network company established by the government to run the massive fibre-to-the-home project. The Australian

THE WEST AUSTRALIAN:

Page 4: WA will be one of the first economies in the world to emerge from the global recession, the Chamber of Commerce and Industry has declared, with a survey suggesting that the state's shoppers will underpin strong growth inside two years.

The first-homebuyer market in WA continues to break new ground with the government grant hitting another high last month.

Page 6: Anglo-Australian giant Rio Tinto yesterday flatly denied claims that it bribed executives from 16 Chinese steel mills taking part in price talks to get the best iron ore prices.

Page 13: Perth's biggest project, the BHP tower, has become a new flashpoint in industrial relations with the building industry watchdog investigating a union and more than 100 workers who downed tools yesterday.

Page 17: The state's economic watchdog has warned the government against merging Verve and Synergy, with its latest report suggesting that most market players were opposed to the potential tie-up because it would contribute to a "more concentrated" power industry and reduce competition.

Business: Iron ore prices have soared almost 10 per cent since the arrest of Rio Tinto executive Stern Hu, adding pressure to China's steel mills to drop their staunch opposition and join Asian peers in accepting a 33 per cent cut to Pilbara benchmark prices.

An executive at China's third-biggest carmaker says the company has made contact about buying the iconic Holden brand from its distressed American parent, General Motors, prompting immediate denials from Holden and the Rudd government.

Flush with cash after a $50 million capital raising last month, Neptune Marine is believed to be poised to buy a Singapore-based oil and gas services company.

Cape Lambert Iron Ore chairman Tony Sage says his big-picture strategy has not changed in the wake of a frenzied month that has handed the cashed-up group effective control of half a dozen explorers across a range of commodities.

Energy and Minerals Australia, the owner of one of WA's biggest uranium deposits, has ignored the lure of a tie-up with a nuclear industry player and instead tapped financial investors to raise $12.2 million.

Administrators for the main European unit of bankrupt US investment bank Lehman Brothers Holding last night revealed plans to return frozen hedge fund assets to creditors as early as next year.

The swarm of bees needed to pollinate Timbercorp's vast almond groves must be ordered within days, the failed company's liquidator says, adding urgency to a Victorian Supreme Court case surrounding the fate of investments linked to the projects.

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: A strong start to the US profit reporting season and better than expected economic data from the world's largest economy have helped the Australian sharemarket gain 5 per cent over the past two trading days, its best two-day rise in almost eight months.

China has reassured Australia about the bilateral economic relationship after Prime Minister Kevin Rudd yesterday stepped up concern over the Stern Hu detention by reminding Beijing it had big economic interests at stake in Australia and the world.

The rules covering managed investment schemes such as those run by the collapsed Timbercorp and Great Southern may need an overhaul because they are too complex for retail investors.

Page 3: A misplaced document could cost Macquarie Office Trust more than half a million dollars.

A slump in work on new homes has not derailed hopes that the building industry will contribute to a broader economic recovery later this year.

Page 7: The managed funds sector urged the federal government to extend tax concessions granted to listed trusts in the budget to investment companies and insurers, a move it said would attract overseas capital.

Page 15: Kerry Stokes has stepped up his assault on James Packer's Consolidated Media Holdings, spending $28 million to grab another chunk of the media investment company.

Page 17: Federal Environment Minister Peter Garrett's approval of Australia's fourth uranium mine has reignited interest in the local uranium sector, as the regulatory barriers to entry start to fall.

THE AUSTRALIAN:

Page 1: Kevin Rudd has toughened his rhetoric towards Beijing over the Stern Hu affair, warning that the world will be watching and emphasising that China has significant economic interests at stake in Australia.

Page 2: As Kevin Rudd began ratcheting up his rhetoric on the Stern Hu case, experts on the entwined Chinese legal and political systems warned the government's only realistic chance to help the detained Rio Tinto executive would come after his sentencing. This is unlikely to happen until the second half of next year.

Page 3: Peter Garrett -- the one-time pin-up of the environmental movement -- is staring down criticism and questions from his former comrades over his decision to approve another uranium mine in Australia.

Page 4: The Rudd government is using its $650 million Jobs Fund to pork-barrel in Labor and marginal seats rather than direct the money to people who need it across the country, the opposition says.

Page 5: Bendigo and Adelaide Bank will consider making employees redundant unless enough agree to take 10 days unpaid leave, equivalent to a 4 per cent pay cut.

One in four self-funded retirees has been forced to return to the workforce or plan to as a result of their shrinking retirement nest eggs, according to a survey by research group CoreData.

Business: Rio Tinto has smashed the market's June-quarter iron ore targets as it ramped up its big West Australian operations to near full capacity to meet growing Chinese iron ore demand.

Former Optus chief executive Chris Anderson is out of the running for the chairmanship of the crucial national broadband network company established by the government to run the massive fibre-to-the-home project.

The chesting between two of Australia's richest men continued yesterday, with Kerry Stokes's Seven Network spending more than $28 million on another 1.5 per cent of the James Packer-backed Consolidated Media.

ANZ chief executive Mike Smith lost faith in US regulators when they allowed Wall Street investment bank Lehman Brothers to fail, and he wondered at the time "if this was the end of the banking system as we know it".

Transpacific faced a catch 22 problem with its proposed $800 million recapitalisation proposal, but it has been solved by the joint underwriters Deutsche Bank and Macquarie Bank thinking outside the square.

Australia's uranium industry is pulling itself from exile and emerging as a key player in the global response to alternative energy sources.

The former boss of Ninemsn has been appointed as an interim director to the board of the federal government's national broadband network company just weeks before official appointments are publicly announced.

A wind-up of 14 olive and almond-growing projects that were run by collapsed agricultural projects manager Timbercorp was the best chance investors in the managed investment schemes had of getting any financial return, a court heard yesterday.

About 7 million bank customers will save $10 million in annual automatic teller machine charges after National Australia Bank and Cuscal agreed to create an ATM network with more than 3100 machines.

ANZ bravely stuck to the line yesterday that its plan for Rod Eddington to succeed Charles Goode as the bank's chairman remained alive, when all indications pointed to the contrary.

Global drinks giant Constellation has elected to rip up 175 hectares of surplus grapevines in premium winegrowing regions after failing to arouse buyer interest.

New Zealand is poised to be one of the first economies to emerge from the global recession, but a key government minister has declared that its recovery depends Australia's performance.

JPMorgan Chase, freed from the government's strictures after repaying $US25 billion ($31bn) in federal money, is back to playing hardball.

Only months after the government rescued Wall Street, risk is back in fashion, or at least it is on Broad Street, home to Goldman Sachs.

The lead bidders for American International Group's asset management unit have dropped out, marking another twist in the giant insurer's drawn-out efforts to sell the division.

When businesses start restocking store shelves and consumers rush in to buy, the signs of an economic turnaround will have arrived. That has yet to happen.

The Australian sharemarket has closed firmly higher, driven by resource and banking stocks and a positive lead from Wall Street.