Tuesday morning headlines

Another up day?: Well, so far. The Dow is up about 30 points, which brings it over the 10,800 mark.

China-Google duel: No sooner than Google redirects millions of Chinese users to its uncensored Web site in Hong Kong, the government tries blocking that site. Also, China's biggest telecom company was expected to cancel a deal involving Google's search engine. (NYT)

Deficit-cutting deal: The governor and state lawmakers finally found a convoluted way of trimming $1.1 billion from mass transit: New tax breaks to home buyers and green-technology companies. But won't tax incentives add to the budget? From the LAT:

To get at the money, lawmakers and the governor are rewriting gasoline-tax laws, swapping a levy that state law designates for mass transit with a tax that can be directed to closing the deficit. The plan preserved more than $400 million in the budget for bus and rail systems, at the insistence of Democrats. Schwarzenegger had initially pushed to eliminate state funding for mass transit entirely.

KB Home still losing: The L.A.-based homebuilder only lost $54.7 million in the first quarter, compared with $58.1 million a year earlier. New home orders rose a bit and cancelled contracts fell a bit. (AP)

CA boosts bond sale: The state will shoot for $2.5 billion, up from $2 billion. This one is for taxable muni bonds and it's aimed mostly for institutional investors. (LAT)

Larry Ellison eyes Warriors: Oracle's CEO billionaire is interested in buying the team, but so are a bunch of others. Many of them want to move the team from Oakland to SF. Price might top $400 million. (San Jose Mercury News)

Lions Gate turns down Icahn: As expected, the board said no to the billionaire investor's hostile bid, calling the offer "coercive" and too low. Icahn, who has a 19 percent stake, wants to forestall an effort by Lions Gate to buy MGM. (Reuters)

Palin reality show?: THR says that Discovery Communications has beaten A&E in bidding for a travelogue called "Sarah Palin's Alaska." A deal could be announced in a few days. Palin's asking price: $1.2 million per episode.

Gas prices peaking?: An average gallon of regular in the L.A. area was up 4 cents from last week, to $3.125, but the recent hikes should be settling down, assuming there's no big jump in oil and supplies are not disrupted. (EIA)

Lacter on radio: This week's business chat with KPCC's Steve Julian covers the MGM and Miramax sales. Also at kpcc.org and on podcast (iTunes has it under Business Update with Mark Lacter).