Today's Business Headlines

$30bn wiped in market reality check
Fears that equity markets may have overshot the pace of the global economic recovery sent the Australian sharemarket plunging 2.4 per cent yesterday -- its biggest one-day percentage slump in more than four months -- wiping $30 billion off the value of stocks. The Australian

Chevron prepares more Gorgon contracts
Chevron is continuing to flex its muscles as the nation's economic saviour, revealing plans to award another $2 billion to $3bn worth of contracts in the next few weeks for the giant Gorgon LNG project off Western Australia. The Australian

Banks to gouge bigger profits
The head of one of Australia's big four banks has warned he and his fellow bankers will ratchet up profit margins on housing and other loans at the expense of customers even as new figures show the property market is struggling with near record low interest rates. The West

Myer's price settles low
A rout across global sharemarkets has helped extract a lower sale price from Myer's owners, TPG and Blum Capital, forcing the biggest float in nearly two years to settle at a final price of $4.10 a share - the bottom end of the prospectus range. The Age

Inflation fuels wage demands
Businesses face labour-cost pressure as unions signal they will seek higher wage claims to offset rising inflation and industry warns of emerging skills shortages in the manufacturing and construction sectors. The Fin Review

THE WEST AUSTRALIAN:

Page 1: The head of one of Australia's big four banks has warned he and his fellow bankers will ratchet up profit margins on housing and other loans at the expense of customers even as new figures show the property market is struggling with near record low interest rates.

Page 4: The Gorgon project is expected to be about 50 per cent Australian made, falling well short of union demands for nearly two-thirds of all goods and services used to build the gas facility to be of local content.

Geraldton has been named WA's most affordable property hot spot with the best chance for capital growth in the next year by an annual list of the top 100 investor locations.

Geraldton is grossly underprepared for the influx of workers from the Oakajee port and rail project and needs an immediate injection of funds for more housing and infrastructure, says mayor Ian Carpenter.

Page 5: Qantas has banned spirits and full-strength beer on all of its flights within WA because of the drunken behaviour of resource industry workers.

Page 7: An Australian trawler fisherman operating in Indonesia says the Timor Sea oil slick has spread deep into his fishing area, spoiling his catch and leaving equipment tainted.

Page 11: Former premier Alan Carpenter has accepted a high-powered executive position at Wesfarmers, owner of the Coles and Bunnings retail empires, a month after quitting politics.

Page 13: Rottnest Island authorities finished urgent work yesterday on five cottages identified as being structurally unsound, with a detailed independent audit on another 310 holiday units to continue over the next few days.

The fleet of 12 new submarines intended to give Australia long-range missile power will cost $3.04 billion each, according to a new report.

Page 19: The plan to surround the WACA ground with high-rise residential and commercial towers has moved a step closer after the cricket association scored a major win over the Australian Taxation Office.

Business: Myer's private equity owners will wave goodbye to the retailer at $4.10 a share, with the price of the much-hyped float dragged lower at the final hour by a sinking sharemarket.

ANZ Bank posted an 11 per cent drop in annual profit yesterday, but declared the nation's banking system may have turned a corner and that the bad debts aping earnings over the past year may have finally peaked.

For Mike Smith, the timing of ANZ's move into its new headquarters rising out of Melbourne's windswept Docklands could not be better.

WA's uranium juniors have been warned by industry veteran Alan Eggers to merge or risk missing out on developing a mine.

Deep Yellow director Gillian Swaby spent $5.5 million last week boosting her stake in the WA-based uranium explorer by 15 million shares.

Battered grower investors in the failed Timbercorp yesterday lobbed a class action against the company, its responsible entity and three directors in a move that will overtake a separate action by Timbercorp's liquidator to be heard in the courts today.

Jupiter Mines, the WA mining hopeful controlled by former BHP Billiton boss Brian Gilbertson, has shrugged off a lack of exploration success at its iron ore and manganese projects, insisting it remains on track to produce the steel-making commodities.

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: Australia and New Zealand Banking Group chief executive Mike Smith has criticised the Reserve Bank of Australia for raising interest rates too soon, suggesting the central bank should have waited until after Christmas and warning about the fragile global economy.

The federal government is facing a Senate logjam over its plan to split Telstra and introduce an emissions trading scheme, putting some of its biggest policy commitments in doubt before an election year.

Ken Henry had spent all Saturday locked in the cabinet room with Kevin Rudd and senior ministers trying to ward off the global financial crisis.

Shares suffered their largest one-day fall in more than four months yesterday after unexpected news of a slowdown in the United States housing market that investors feared would slow the pace of recovery in the world's largest economy.

Page 3: Businesses face labour-cost pressure as unions signal they will seek higher wage claims to offset rising inflation and industry warns of emerging skills shortages in the manufacturing and construction sectors.

Page 7: Simplifying the tax system to reduce complexity was the most important priority of Ken Henry's tax-transfer review, the Treasury secretary has declared.

Page 13: People filing tax returns have until Monday to lodge their information to the Australian Taxation Office, or risk facing a fine for being late.

Page 43: Myer's private equity owners, TPG and its junior partner Blum Capital, have bowed to institutional investor demand and sold their entire holding into the department store chain's $2.4 billion initial public offering as difficult equity market conditions restricted the price to the lower end of the indicative range.

Page 44: Rio Tinto has taken its research and analysis team in China out of the field in the lead up to crucial iron ore negotiations, as the mining giant continues to deal with the fallout of the Stern Hu arrest.

Page 45: US oil company Hess is increasingly shaping as the critical piece of the puzzle in Woodside Petroleum's liquefied natural gas expansion plans, after Hess revealed further exploration success from its West Australian exploration block.

Mount Gibson Iron has pledged to continue the pursuit of the two remaining Chinese steel mills which defaulted on sales contracts last year after winning up to $US30 million compensation from the third group which took this course of action.

THE AUSTRALIAN:

Page 1: The Rudd government has failed its own test for assessing major infrastructure projects, according to a new Productivity Commission analysis.

The International Monetary Fund has warned that Asia's rapid recovery will not be sustained, but better than expected US growth figures may have signalled an end to recession in the world's largest economy.

Liberal Party frontbenchers have begun to dump their support for carbon emissions trading after receiving party research showing voters are increasingly skittish about putting a price on carbon.

Page 2: China has signalled it wants fast progress on stalled free trade agreement talks with Australia and to use the "unique" relationship between the countries as a model for Beijing's relations with other countries.

The majority of Australian businesses believe the worst of the economic slump is over, but more than half think the federal government stimulus has not helped in any way.

Page 3: Schools expect too little of their students and become inured to bad results, accepting low standards as normal, says one of the nation's leading teachers.

Medicare rebates for the most common type of cataract surgery will be slashed by more than $280 from Sunday, after the federal government sidestepped a Senate vote blocking its planned cuts and announced a new set of reductions only slightly less severe.

Buyers will be stuck with model "orphans" and dealers who invested millions to launch the Dodge brand will be left without cars to sell under Fiat's plans for the Chrysler group.

Page 6: The failure of Australia's biggest cotton grower has fuelled Coalition squabbling, after Nationals Senate leader Barnaby Joyce blamed the Liberals for Cubbie Station's collapse.

Page 7: A company headed by an American billionaire once jailed for white collar crimes says it would only bid for the failed ABC Learning childcare group with an Australian partner.

Page 8: The head of Progressive Business, the ALP's most successful fundraising body, has lashed out at plans by the Rudd government to ban corporate donations to political parties.

A late surge in stamp duty has helped boost the NSW budget bottom line for 2008-09 by $440 million, providing further evidence that NSW, the first state to enter the economic downturn, could be first on the rebound.

Page 9: Medical schools are warning that time is running out to boost hospital training places, as figures show the number of graduates will soar by nearly 80 per cent over the next five years.

Agricultural technology company Monsanto hopes to double crop yields by 2030 as well as reduce the amount of fertilisers, chemicals and water used by a third, by combining conventional plant breeding with genetically modified lines.

Business: Fears that equity markets may have overshot the pace of the global economic recovery sent the Australian sharemarket plunging 2.4 per cent yesterday -- its biggest one-day percentage slump in more than four months -- wiping $30 billion off the value of stocks.

ANZ Bank is pushing back strongly against the rising tide of global regulation, with its outspoken chief executive Mike Smith cautioning the local prudential regulator against "fixing something that's not broken".

ANZ Bank has gone a step further than its rivals, predicting that the bad debt cycle has peaked and interest margins will expand for several years as loans are repriced for increased risk.

Myer's US private equity backers have missed out on as much as $310 million in sale proceeds after fund managers baulked at paying top dollar for the department store chain.

Institutional banking has emerged as one of ANZ's standout performers thanks to market traders "making hay while the sun shone", according to chief executive Mike Smith.

Chevron is continuing to flex its muscles as the nation's economic saviour, revealing plans to award another $2 billion to $3bn worth of contracts in the next few weeks for the giant Gorgon LNG project off Western Australia.

BHP Billiton chief executive Marius Kloppers sees signs of a "pullback" in demand as China finishes rebuilding its inventories of raw materials.

AGL Energy has flagged a potential billion-dollar rights issue if it is the winning bidder in the NSW government's privatisation of the state's power assets next year.

Goldminer Newcrest Mining has pledged to pursue growth through mergers and acquisitions, and says the outlook for the precious metal remains positive as worldwide supply tightens.

Finance Minister Lindsay Tanner has welcomed the Future Fund's annual report, which shows losses from the "unprecedented turmoil" in 2008-09 have already been reversed.

Ford has selected a group led by China's Geely as the preferred bidder for the US company's Volvo unit, marking an important step forward for what would be the most ambitious international expansion so far by a Chinese carmaker.

ConocoPhillips will sell assets in Canada, the US and the North Sea as part of its restructuring bid -- a transformation that heralds a major shift in the way the oil business is run, according to executives.

The Australian sharemarket posted its biggest one-day percentage fall in about four months amid heavy losses among banking and mining stocks, on concerns that the global economic recovery could have stagnated.