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conflict boils over. This Friday - the Middle East by the Israeli military An air and sea assault rocket attacks from Lebanon. after a series of retaliatory

in Sydney. Fire crews battle two factory blazes The worst prompting 150 evacuations. its long-awaited media reforms The Federal Government unveils and acquisitions. paving the way for mergers And in sport - risky business. admits it was a gamble Queensland Reds coach Eddie Jones Clinton Schifcofske. signing league convert weather and for the rest of the day: Now for a look at the national at finance Now time for our first look this morning? and the price of oil dominating trade Bill, thank you and good morning. have fallen Well, stocks on Wall Street and the escalating oil price. due to tension in the Middle East in business and finance, Bill. And that's the latest is calling for calm this morning The United Nations reaches crisis point. as violence in the Middle East Scores of people have been killed several targets in Lebanon after the Israeli military bombarded including Beirut Airport. And in the last few hours, the northern Israel city of Haifa. reports Lebanese rockets have hit began early today The attack on Lebanon across the country. with a series of strikes Firstly, they came from the air. to the sound of explosions. The capital woke had attacked the airport. The Israeli Airforce War planes fired four missiles out of the main runways. gouging craters but to close operations down. The airport authorities had no choice from the sea. Then the Israeli Navy attacked of all Lebanese ports. It also plans to enforce a blockade to their next target - The war planes moved on to the militant group, Hezbollah a TV station connected on the ground. creating panic and chaos Then the war planes moved south close to the Israeli border. hitting people and villages were killed. Scores of people, including children, there will be more attacks Israel has warned and now people in some areas they haven't done for many years - are doing something and getting ready to leave the city. they're packing up their homes are in Canberra today State and Territory leaders health, education, childcare, skills to work out national reforms in and Indigenous Australia. embryonic stem cell research The PM will be asked to end bans on James Hardie compensation payouts. and consider tax exemptions for to have it listed I hope that this agreement to fix it. is a signal he will take action But John Howard is concerned its responsibilities James Hardie is offloading onto the Australian taxpayer. on a public transport worker A sickening attack in western Sydney overnight. A young man has been charged the train driver with stones after allegedly pelting

knocking him unconscious. and extensively searched. Police attended immediately

assisted police with inquiries. A number of youths were detailed and The train was brought to a halt. for treatment. The driver rushed to hospital through the night The factory blazes raged and prompting evacuations. threatening buildings workshop was engulfed in flames The Chippendale auto-electrics by the time fire crews arrived. 50m above the building. The firefighters reported the flames and dangerous explosions But it was the number of sudden which concerned firefighters most of 15 cars inside blew up, as the fuel tanks and tyres to evacuating 150 residents they turned their attention from a neighbouring unit block. It was basically a massive bang everywhere. with all these flames bellowing I was a wreck.

I'm still shook up a bit. and his care was getting fixed. A double blow for one man evacuated and his car was getting fixed. She was a beauty. It's pretty sad. I loved that car. With residents evacuated, on fighting the blaze fire crews could concentrate of saving the building. but by that stage, they had no hope next door They did manage to spare the building to the relief of the owner. of flammable material We have got a large amount and being literally right next door and some charring to our wall. there will be some smoke damage for strict city fire crews And to make matters worse another fire at the same time they were battling a few kilometres away in Petersham. This gymnasium also gutted. Danielle Isdale, Ten News. Victorians will find out today off the job for the first time if paramedics in Melbourne will walk in more than three decades. and the Bracks Government The ambulance service about rostering changes, have discussed concerns but to no avail. to ambulance services The stopwork could cause disruptions across Melbourne. will meet again today Delegates from both sides but if the stalemate continues, members will strike next week. the Paramedics Union has threatened with convicted drug smuggler The man whose photo was taken Schapelle Corby north Queensland to face court. has been extradited to 60-year-old Malcolm McCauley,

Gold Coast beauty student, seen here with the former charged is one of four South Australian men drug trafficking syndicate. with taking part in an interstate

allegedly carried cannabis 'The Advertiser' reports the men and Queensland over a 2-year period. between South Australia have named two suspects Authorities in India in Mumbai. in this week's terror bombings has released pictures of the two men The country's anti-terror squad

the attacks. who it believes carried out injured Meantime, many of the 700 people

train bombings in India in Tuesday's devastating have received compensation payments. in hospitals in Mumbai, Hundreds are still being treated 200 people were killed in the blasts during the busy peak hour. which were timed to go off says Queensland Reds coach Eddie Jones

Clinton Schifcofske is a risk. the signing of NRL player and Queensland fullback Jones believes the Canberra has the ability to match the success of fellow converts Lote Tuqiri and Mat Rogers, but he says there's always doubts with any new signing. Look, every player is a gamble. It's a calculated risk. The thing that appeals to me is that he's a studious player, and studious players, particularly in the outside backs will make the switch. He's a good footballer. Schifcofske hasn't played rugby union since he was a schoolboy and admits he faces a massive challenge. AFL - and the Kangaroos will call the Gold Coast home next year agreeing to play at least three games a season there until the end of 2009.

The deal ends a 6-year involvement with Canberra but the Kangaroos are adamant the Gold Coast will provide a financial windfall for their ailing club. There is a myriad of calculations - you've got a worst case, you've got a best case. In any event, we expect with our position, within the next three years, will improve by a minimum of $1 million. In selection news, the injury problems continue for Essendon

with Dustin Fletcher, Angus Monfries and Courtney Johns

all ruled out of Saturday's game against St Kilda. The Wallabies are expecting a full scale assault from South Africa's forwards in this Saturday's Tri-Nations game in Brisbane. The Aussies have copped heavy criticism after being outmuscled by the New Zealand forwards during last weekend's loss in Christchurch and they are ready for more fireworks up front. They are definitely the biggest scrum in world rugby and that's they way they've picked this side. They've picked this side to attack us in that area and we figured that they would do that. The Wallabies are confident South African-born lock Daniel Vickerman will overcome a back injury and be right to play. Time for more finance news and Kath, investors reacted positively to yesterday's media shake up? Yes, Bill. Media stocks were one bright spot in an otherwise gloomy market yesterday after the Federal Government finally unveiled its long-awaited media reforms. The sector is now bracing for raft The sector is now bracing for a raft of mergers and acquisitions. It was a round of applause from the market - investors sending media stocks through the roof. Among the biggest movers -

Southern Cross Broadcasting and Fairfax, both up more than 5%. It's the biggest shake up the $12-billion-a-year industry has seen in 20 years - topping the changes - the removal of foreign ownership caps. We haven't really had a free environment for media for a long, long time and I think the media sector has been waiting for this consolidation for a number of years. Also paving the way for a number of mergers throughout the sector is the removal of restrictions on cross media ownership. This means a media company can own both television, newspaper and radio stations in the one market, something previously forbidden. What these rules are designed to do is promote flexibility. But many fear the new laws will dramatically reduce competition. You'll now be able to have

a very small number of extremely powerful media owners totally dominating the debate. The package will give viewers access to new digital channels and allow broadcasters to multi-channel,

but there won't be another free-to-air operator until at least 2010. The changes are still to pass the Senate. Matthew Taylor, Ten News. Now for a look at the national weather and for the rest of the day: Violence escalates across the Middle East - we'll have an update right after this break. I'd say, "Come into Bunnings. We have the biggest range around." you're gonna be hard pressed to find it anywhere else. Synthetic coir and rubber mat, only $16.90. 45-litre laundry tub, $159. Arlec garden stake with timer, $29.98. Redline plastic tool box, just $9.48. a cheaper price on a stocked item, we'll beat it by 10%. Lowest prices are just the beginning.

Welcome back to Ten's Early News. This morning - Australians warned to stay out of Lebanon as the crisis with Israel escalates. Airports and ports in shutdown following a series of bombing raids. State and Territory leaders call on the Federal Government to consider tax exemptions for James Hardie compensation payouts. A trainee public transport driver pelted with stones in western Sydney. Police question a group of youths. And an international terrorism expert warns transport networks across Australia are still vulnerable to a attack.

Kath's back with another check of the markets and big falls on Wall Street? Yes, and that's thanks to tensions in the Middle East. Unemployment at 30-year lows sparking fears of another rate hike. I'll have more on that shortly. Israeli troops are continuing to bombard targets across Lebanon as violence in the region reaches crisis point. Joining us from Beirut is CNN reporter Anthony Mills. Beirut's come under heavy a series of attacks over the last 12 hours. What's the latest? There were more strikes today. The streets are empty.

Many residents are indoors waiting for news. How is Lebanon responding? The government said it had no prior warning. The Cabinet condemned the assault. The reaction is also a general act of war on Lebonan. How many are fleeing the city?

There are reports of thousands of vehicles crossing the border into Syria. Syria has opened the border to allow more people to flee Lebanon.

All three runways are damaged at the airport. People are fleeing by road. State and Territory leaders will ask John Howard to end bans on therapeutic cloning and consider tax exemptions for James Hardie compensation payouts. The Council of Australian Governments will also consider major national reforms. It's unusual for John Howard and Labor leaders to see eye-to-eye. But after the Prime Minister agreed to fund more trainee doctors in return for State health reforms, some Premiers were prepared to give Mr Howard credit at the expense of his rival. I'm delighted that the PM has given us the big tick. That is why we like working with him rather than Peter Costello. State and territory leaders are in Canberra to discuss national reforms, in areas of mental health, skills and indigenous Australia. What the Prime Minister has is a golden opportunity

where every State and territroy leader will deliver a comprehensive reform agenda. Mr Howard focusing on childcare, literacy and the nation's road, rail and energy infrastructure. There'll also be a push to convince the PM

to end bans on embryonic stem cell research, and introduce tax exemptions for James Hardie compensation payouts. I really think James Hardie is trying to offload part of its responsibility to the Australian taxpayer. One thing all leaders are expected to agree on - a bid for Australia to host the 2018 Soccer World Cup but there's no concensus on where the final would be played. Murray McCloskey, Ten News.

A prison escapee is believed to have been involved in a dangerous police pursuit in Sydney. The chase began in Belrose when two police cars spotted a stolen vehicle.

Reaching high speeds, the driver of the red BMW allegedly rammed both police cars. He was arrested along with his passenger at the scene. A train driver is in hospital after being attacked by a gang in Sydney's west overnight. A young man has been charged with allegedly throwing rocks at the driver knocking him unconscious. The trainee driver came under attack as his train passed through this platform at the Doonside station in Sydney's west. Hurling rocks, a young group allegedly fled the scene when police got word of the attack and the driver's condition. MAN: There's blood all over the driver's seat and the floor.

He was unconscious by the time paramedics arrived. Police meantime scouring nearby backyards for the alleged attackers. Polair and the Dog Squad called in to assist. A number of youths were detained and assisted police with their inquiries. However, they were released. One person is still in police custody. Gemma Riordan, Ten News. A win for the defence team of Australian suspected terrorists. The Federal Police ordered to hand over hundreds of hours of secretly taped conversations. Melbourne's Chief Magistrate made the decision as lawyers prepare for the committal hearing of the 13 suspected terrorists in Victoria arrested following the nations biggest swoop

following the nation's biggest swoop on terror suspects last year. The AFP will now have to give defence barristers 900 hours of covertly taped conversations between the men. The Kangaroos are seeking a pot of gold in Queensland giving Canberra the cold shoulder. The club announced they will play 10 games over three years at Cararra on the Gold Coast. It's a deal the Kangaroos couldn't refuse. With support from the AFL, the Roos believe they will be $1 million better off

for shiftng home games from Canberra to the Gold Coast. We expect that our position over the next three years will improve by a minimum of a million dollars. But Canberra won't be out in the football wilderness, the league already assessing options for other clubs to play in the nation's captial. Yes, well, we've met four clubs today. We started off meeting Essendon this morning. We met Melbourne football club, Kangaroos and the Western Bulldogs. Nick Davis has drawn the wrath of Sydney coach Paul Roos who's not impressed the Swans goalsneak

publicly criticised his axing for Saturday's grand final rematch

against the West Coast Eagles. Yeah, I think Nick and I will have a pretty good discussion next week.

He's reasonably fortunate that I'm standing here in WA as we speak. David Adamson for Sports Tonight. Australian cyclist Cadel Evans has started his charge at the Tour de France. Stage 11, the hardest course in the Pyrenees, took riders through some of the most famous passes. Able to conquer the final ascent to the finish Russian Denis Menchov won the stage outsprinting Americans Levi Leipheimer and Floyd Landis, the new race leader. Evans, a climbing specialist, finished fourth

moving him up seven places into 4th overall. Fellow Australian Michael Rogers is currently 7th. Queensland Reds coach Eddie Jones says the signing of NRL player Clinton Schifcofske is a risk. Jones believes the Canberra and Queensland fullback has the ability to match the success of fellow converts Lote Tuqiri and Mat Rogers, but he says there's always doubts with any new signing. Look, every player is a gamble. It's a calculated risk. The thing that appeals to me is that he's a studious player, and studious players, particularly in the outside backs will make the switch. He's a good footballer. Schifcofske hasn't played rugby union since he was a schoolboy and admits he faces a massive challenge. Kath's back with more finance

and rates look like they're heading up again? Interest rates look set to jump again with the latest jobless figures again sparking inflation fears. Unemployment remains at a 30-year low of 4.9% after more than 52,000 new jobs were created. There are fears the tight labour market will fuel wage pressures that may in turn push up inflation. We can't afford to have any wage increases that aren't supporsted by productivity. We can't awfford to have secondary

We can't afford to have secondary claims coming out of fuel prices. We must remain vigilant. Economists say the latest employment figures combined with strong lending numbers released earlier this week support the case for another rate rise next month. The Federal Government says it will make a final decision about the sale of its remaining stake in Telstra within the next few weeks. Finance Minister Nick Minchin has admitted the sale process may be delayed if the phone giant's share price fails to rise and if the cloud surrounding regulation remains. I'd say at this satge it's pronbably 50-50. There's still some uncertainty about the regulatory environment for Telstra that would cause uncertainty investors. If the sale does go ahead, Mr Minchin says October to November is a realistic time frame. Now for a look at the national weather and for the rest of the day:

Police charge a man over an violent attack on a train driver. The details when Ten's Early news comes back.

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This Friday - the Middle East conflict boils over. An air and sea assault by the Israeli military after a series of retaliatory rocket attacks from Lebanon. Fire crews battle two factory blazes in Sydney. The worst prompting 150 evacuations. The Federal Government unveils its long-awaited media reforms paving the way for mergers and acquisitions. And in sport - risky business. Queensland Reds coach Eddie Jones admits it was a gamble signing league convert Clinton Schifcofske.

Now for another check of the markets. Wall Street closed in the red thanks to tension in the Middle East and escalating oil prices. Israel has warned Lebanon there'll be prolonged attacks as tensions rise between the Middle East neighbours. In the worst violence since 1996 53 Lebanese have been killed after airstrikes in Beirut. Israel retaliates to the ambush and capture of two soldiers in a cross-border raid by Hezbollah millitants. Israel retaliates to the ambush and capture of two soldiers in a cross-border raid by Hezbollah millitants.

The sudden escalation of violence Kofi Annan will try and create peace.

The Department of Foreign Affairs has set up a hotline for information on Australians who may be caught up in the trouble in Lebanon. That number: State and Territory leaders are in Canberra today to work out national reforms in health, education, childcare, skills and Indigenous Australia. The PM will be asked to end bans on embryonic stem cell research

and consider tax exemptions for James Hardie compensation payouts. I hope that his agreement to have it listed is a signal he will take action to fix it. But John Howard is concerned James Hardie is offloading its responsibilities onto the Australian taxpayer. An attack on a public transport worker in western Sydney overnight. A young man has been charged after allegedly pelting the train driver with stones at the Doonside station knocking him unconscious. Police attended immediately and extensively searched the area. A number of youths were detained and assisted police with inquiries. The train was brought to a halt.

The driver rushed to hospital for treatment.

Firefighters have brought under control two massive fires in Sydney. The factory blazes raged through the night threatening buildings and prompting evacuations. The Chippendale auto-electrics workshop was engulfed in flames by the time fire crews arrived.

The firefighters reported the flames 50m above the building. But it was the number of sudden and dangerous explosions which concerned firefighters most as the fuel tanks and tyres of 15 cars inside blew up, they turned their attention to evacuating around 150 residents from a neighbouring unit block. It was basically a massive bang with all these flames bellowing everywhere. I was a wreck. I'm still shook up a bit. A double blow for one man evacuated and his car was getting fixed. It's pretty sad. I loved that car. She was a beauty. With residents evacuated, fire crews could concentrate on fighting the blaze but by that stage, they had no hope of saving the building. They did manage to spare the building next door to the relief of the owner. We have got a large amount of flammable material and being literally right next door there will be some smoke damage and some charring to our wall. And to make matters worse for strict city fire crews at the same time they were battling another fire a few kilometres away in Petersham. This gymnasium also gutted.

Danielle Isdale, Ten News. Federal Police have reportedly been ordered to hand over hundreds of hours of secretly taped conversations between Melbourne terror suspects. The decision coming as lawyers prepare for the commital hearing of the men. 'The Australian' newspaper reports in a preliminary hearing,

Melbourne's Chief Magistrate has ordered police to hand over 900 hours of covertly taped conversations between the 13 men. He's ruled there's a legitimate forensic purpose in the suspects lawyers having access to part of the Australian Federal police material.

Victoria Police has also reportedly been ordered to handover the notes of an undercover agent. But the paper says the Chief Magistrate has left the way open for Victorian police to argue against that. The men were arrested and charged with terror offences last November. Meantime, a terror analyst has warned Australia's transport network

remains vulnerable to attack. He says after the coordinated attacks on India's commuter network, the design of Australian trains could make the destructive effects of explosive devices even worse. Mignon Henne, Ten News. Authorities in India have named two suspects in this week's terror bombings in Mumbai. The country's anti-terror squad has released pictures of the two men who it believes carried out the attacks. Meantime, many of the 700 people injured in Tuesday's devastating train bombings in India have received compensation payments. Hundreds are still being treated in hospitals in Mumbai, 200 people were killed in the blasts which were timed to go off during the busy peak hour. Queensland Reds coach Eddie Jones says of the signing of NRL star Clinton Schifcofske is a risk. But he's confident he'll make a similar impact to previous code converts. Eddie Jones believes Clinton Schifcofske has the potential to be as successful as rugby league converts and current Wallabies, Mat Rogers and Lote Tuqiri. But Jones concedes there's always doubts with any new signing. Look, every player is a gamble. It's a calculated risk. The thing that appeals to me is that he's a studious player, and studious players, particularly in the outside backs will make the switch. He's a good footballer. The Queensland State of Origin and Canberra Raiders fullback hasn't played rugby union since he was a schoolboy and he realises the big task in front of him. It will be a massive challenge and it's something that I think I'm playing well enough and I'm experienced enough to handle the challenge as well. It's something I'm really looking forward to. 30-year-old Schifcofske will be used as a goal-kicking winger. Saying goodbye to his Raiders team-mates, one of the toughest parts of his decision. People talk about professional sport being a business, and it probably is. But I think when you leave your team-mates, it is a bit more than a business and that's going to be the toughest thing. And I just wish them all the best. Trent Higgs, Ten News. AFL - and the Kangaroos will call the Gold Coast home next year agreeing to play at least three games a season there until the end of 2009. The deal ends a 6-year involvement with Canberra but the Kangaroos are adamant the Gold Coast will provide a financial windfall for their ailing club. There is a myriad of calculations - you've got a worst case, you've got a best case. In any event, we expect with our position, over the next three years, will improve by a minimum of $1 million. In selection news, the injury problems continue for Essendon with Dustin Fletcher, Angus Monfries and Courtney Johns all ruled out of Saturday's game against St Kilda. The Wallabies are expecting a full scale assault from South Africa's forwards in this Saturday's Tri-Nations game in Brisbane. The Aussies have copped heavy criticism

after being outmuscled by the New Zealand forwards during last weekend's loss in Christchurch

and they are ready for more fireworks up front.

They are definitely the biggest scrum in world rugby and that's they way they've picked this side. They've picked this side to attack us in that area and we figured that they would do that. The Wallabies are confident South African-born lock Daniel Vickerman will overcome a back injury and be right to play. Now for another check of the markets. Bill, television veteran Sam Chisholm announced last night he is leaving the board of Publishing and Broadcasting after just 22 months. Mr Chisholm was hired to guide the Nine Network through its search for a new chief executive and says it's now time to go. But his departure has raised more speculation he's about to head to the ABC to take on the top job there. Mr Chisholm will also leave the Foxtel board, adding to suggestions he'll be appointed ABC Chairman at the end of the year.

Media stocks were one bright spot in an otherwise gloomy market yesterday after the Federal Government finally unveiled its long-awaited media reforms. The sector is now bracing for a raft of mergers and acquisitions. It was a round of applause from the market - investors sending media stocks through the roof. Among the biggest movers - Southern Cross Broadcasting and Fairfax, both up more than 5%. It's the biggest shake up the $12-billion-a-year industry has seen in 20 years -

topping the changes - the removal of foreign ownership caps. We haven't really had a free environment for media for a long, long time and I think the media sector has been waiting for this consolidation for a number of years. Also paving the way for a number of mergers throughout the sector is the relaxation of restrictions on cross media ownership. This means a company can own both television, newspaper and radio stations in the one market, something previously forbidden. What these rules are designed to do is provide a bit of flexibility. But many fear the new laws will dramatically reduce competition. You'll now be able to have a very small number of extremely powerful media owners totally dominating the public debate. The package will give viewers access to new digital channels and allow broadcasters to multi-channel,

but there won't be another free-to-air operator until at least 2010. The changes are still to pass the Senate. Matthew Taylor, Ten News. Now for a look at the national weather and for the rest of the day: More news after the break. IN THE NATION'S CAPITAL, RAIN THIS AFTERNOON AND THIS EVENING, WITH MODERATE NORTH EAST WINDS, AND 12 DEGREES. SHOWERS IN SYDNEY, FINE IN MELBOURNE. MORNING FOG AND FROST ON THE HIGHLANDS, CLEARING TO A COOL MILD DAY, AND 17 DEGREES, IN WOLLONGONG. 16 AND SHOWERS IN BEGA. 13 IN ORANGE. SHOWERS TOO IN BOWRAL, BATEMANS BAY, AND BATHURST. SADLY - NO SUCH LUCK - IN GOULBURN. A DAMP ONE AND 17, IN BOTH NOWRA AND MUDGEE. MINUS 5 WARMING TO 11 IN COOMA. CHECKING THE OUTLOOK NOW... FOR CANBERRA AND SURROUNDS. AND A DAMP WEEKEND ON THE WAY, WITH RAIN FOR SATURDAY AND SUNDAY. SHOWERS TO START THE WORKING WEEK, CLEARING BY WEDNESDAY. (NO SCRIPT NEEDED HERE.) Welcome back to Ten's Early News. This morning - Australians warned to stay out of Lebanon as the crisis with Israel escalates. Airports and ports in shutdown following a series of bombing raids.

State and Territory leaders call on the Federal Government to consider tax exemptions for James Hardie compensation payouts. A trainee public transport driver pelted with stones in western Sydney. Police question a group of youths. And an international terrorism expert warns transport networks across Australia are still vulnerable to attack. Israeli troops are continuing to bombard targets across Lebanon as violence in the region reaches crisis point. CNN reporter Anthony Mills.

There were more strikes today. Many residents are indoors waiting for news. The second attack on Beirut Airport. Pictures of flames shooting into the sky. The strike came from gun boats. There is a sense of foreboding. Leaflets were dropped over parts of Beirut. Warning people to stay away. State and Territory leaders will ask John Howard to end bans on therapeutic cloning and consider tax exemptions for James Hardie compensation payouts. The Council of Australian Governments will also consider major national reforms. It's unusual for John Howard and Labor leaders to see eye-to-eye.

But after the Prime Minister agreed to fund more trainee doctors

in return for State health reforms, some Premiers were prepared to give Mr Howard credit at the expense of his rival. I'm delighted that the PM has given us the big tick. That is why we like working with him rather than Peter Costello. State and territory leaders are in Canberra to discuss national reforms, in areas of mental health, skills and indigenous Australia. What the Prime Minister has is a golden opportunity where every State and territroy leader will deliver a comprehensive reform agenda. Mr Howard focusing on childcare, literacy and the nation's road, rail and energy infrastructure. There'll also be a push to convince the PM to end bans on embryonic stem cell research, and introduce tax exemptions for James Hardie compensation payouts. I really think James Hardie is trying to offload part of its responsibility to the Australian taxpayer.

One thing all leaders are expected to agree on - a bid for Australia to host the 2018 Soccer World Cup but there's no concensus on where the final would be played. Murray McCloskey, Ten News.

It took them the best part of the night, but firefighters have managed to contain two workplace fires in Sydney. The largest was at this auto electrics business in Chippendale. It broke out around 9:00pm last night, prompting 150 evacuations. Sudden and dangerous explosions had fire crews extremely concerned. At nearby Petersham, the top level of a gymnasium went up in smoke. It's in check now, but street closures are still in place. A prison escapee is believed to have been involved in a dangerous police pursuit in Sydney.

The chase began in Belrose when two police cars spotted a stolen vehicle. Reaching high speeds, the driver of the red BMW allegedly rammed both police cars. He was arrested along with his passenger at the scene. A train driver is in hospital after being attacked by a gang in Sydney's west overnight. A young man has been charged with allegedly throwing rocks at the driver knocking him unconscious. The trainee driver came under attack as his train passed through this platform at the Doonside station in Sydney's west. Hurling rocks, a young group allegedly fled the scene when police got word of the attack and the driver's condition. MAN: There's blood all over the driver's seat and the floor. He was unconscious by the time paramedics arrived. Police meantime scouring nearby backyards for the alleged attackers. Polair and the Dog Squad called in to assist. A number of youths were detained and assisted police with their inquiries. However, they were released. One person is still in police custody. A man has been charged with assault. Gemma Riordan, Ten News. A win for the defence team of Australian suspected terrorists. The Federal Police ordered to hand over hundreds of hours of secretly taped conversations. Melbourne's Chief Magistrate made the decision as lawyers prepare for the committal hearing of the 13 suspected terrorists in Victoria arrested following the nation's biggest swoop on terror suspects last year. The AFP will now have to give defence barristers 900 hours of covertly taped conversations between the men. Victorians will find out today if paramedics in Melbourne will walk off the job for the first time in more than three decades. The ambulance service and the Bracks Government have discussed concerns about rostering changes, but to no avail. The stopwork could cause disruptions to ambulance services across Melbourne. Delegates from both sides will meet again today but if the stalemate continues, the Paramedics Union has threatened members will strike next week. The Kangaroos are seeking a pot of gold in Queensland giving Canberra the cold shoulder. The club announced they will play 10 games over three years at Cararra on the Gold Coast. It's a deal the Kangaroos couldn't refuse. With support from the AFL, the Roos believe they will be $1 million better off

for shiftng home games from Canberra to the Gold Coast. We expect that our position over the next three years will improve by a minimum of a million dollars. Fron next season, But Canberra won't be out in the football wilderness, the league already assessing options for other clubs to play in the nation's captial. Yes, well, we've met four clubs today. We started off meeting Essendon this morning.

We met Melbourne football club, Kangaroos and the Western Bulldogs. Nick Davis has drawn the wrath of Sydney coach Paul Roos who's not impressed the Swans goalsneak publicly criticised his axing for Saturday's grand final rematch against the West Coast Eagles. Yeah, I think Nick and I will have a pretty good discussion

next week. He's reasonably fortunate that I'm standing here in WA as we speak. David Adamson, Ten News. Russian Denis Menchov won the stage outsprinting Americans Levi Leipheimer and Floyd Landis, the new race leader. Evans, a climbing specialist, finished fourth moving him up seven places into 4th overall. Fellow Australian Michael Rogers is currently 7th.

The latest development in the ongoing Zinedine Zidane headbutting saga. FIFA is now investigating the behaviour of Italian defender Marco Materazzi. Football's governing body has opened a inquiry after hearing Zidane's claims that he'd been repeatedly provoked by insults before head-butting Materazzi in the chest. FIFA has also summoned both players to attend a hearing of its disciplinary committee next week. Now for another check of the markets. Well, asestos victims are calling on the PM to overturn a Tax Office decision that threatens James Hardie compensation payments. The Prime Minister maintains, it's not up to the Australian public to foot the bill. The ATO has only ruled that the payments can be tax deductible. A dolphin with a nose for trouble has been rescued again in Adelaide. Twinkle's tail fluke was tangled in rope for four days before rangers could reach him.

A notch in his tail from a previous entanglement means he easily gets caught in fishing equipment and other debris. Unfortunately we've had so many of these, and particularly with this particular dolphin that we're getting good at it. Now for a look at the national weather and for the rest of the day:

A quick recap of the morning's top stories - the UN calls for calm as scores of people are killed in fighting between Israel and Lebanon. State and territory leaders to meet in Canberra to discuss out national reforms and James Hardie compensation. And fire crews in Sydney battle two major factory blazes.

Both prompting evacuations. And that's Ten's Early News. I'm Bill Woods. And I'm Kath Robinson. Good morning.

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