Rio Tinto has swooped on the US company Arcadium Lithium in a £5.1bn takeover, trying to get a foothold in the supply of lithium, a key component in electric car batteries.

It is a huge bet on the energy transition despite tough conditions in the global electric car market. Lithium is known as “white gold” due to its market value and silver colour.

The London-listed metal and mining giant’s shares fell by 2.3%, while New York-listed Arcadium shares jumped by 31% in pre-market trade.

Rio Tinto said it will pay $5.85 a share for the Pennsylvania-based lithium miner. That represents an almost 90% premium to Arcadium’s closing price of $3.08 a share on 3 October, the day before news of a potential deal emerged.

The acquisition will give the Anglo-Australian company access to lithium mines, processing facilities and deposits in Argentina, Australia, Canada and the US, as well as a client roster that includes the carmakers Tesla, BMW and General Motors.

Lithium prices have fallen because of Chinese oversupply and a slowdown in electric vehicle sales, turning miners of the metal into attractive takeover targets.

If the deal goes through, Rio Tinto will become the world’s third largest supplier of lithium, behind Albemarle and SQM.

Rio Tinto’s chief executive Jakob Stausholm said the purchase is a

significant step forward in Rio Tinto’s long-term strategy, creating a world-class lithium business alongside our leading aluminium and copper operations to supply materials needed for the energy transition.

Stocks in China plunged, after a press briefing by Beijing’s top economic planner on Tuesday disappointed investors.

They had hoped for more stimulus measures, but officials did not announce any major new steps.

The Shenzhen Composite Index tumbled by 8.2% in its biggest fall since May 1997, while the Shanghai stock exchange lost 6.6% and the benchmark CSI 300 slid by 7.1% after the Golden Week holiday. Hong Kong’s Hang Seng was down by 1.8%.

Before the week-long holiday, Chinese stocks rallied when a raft of measures were announced by the People’s Bank of China and other authorities to revive the economy, the boldest stimulus package since the pandemic.

China’s finance ministry is due to set out its plans on fiscal stimulus in more detail at a news conference on Saturday. Finance Minister Lan Fo’an will attend the conference, whose theme is “intensifying countercyclical adjustment of fiscal policy to promote high-quality economic development”.

Investors are expecting a spending package between 4 and 10 trillion yuan (£220bn to £1.1tn).

Richard Hunter, head of markets at the trading platform interactive investor, said:

Shares in China underwent another difficult session as investor disappointment in the region persisted. The main concern was that the raft of measures announced prior to last week’s holiday – which had lit the fire under a moribund market – were not followed up with any specific actions from the authorities, or indeed further plans. The puncturing of enthusiasm fed through to commodity stocks.

The minutes of the US Federal Reserve’s last meeting will be published tonight and may attract less interest than usual, given the raft of recent comments from Fed members as the economic picture has evolved.

Hunter said:

Indeed, any comments over concerns around a deteriorating labour market will have been eclipsed by last week’s bumper non-farm payrolls report, the result of which has been the tempering of interest rate cut expectations. Of rather more interest, perhaps, will be tomorrow’s reading on inflation in the form of the Consumer Price Index, which could show that the taming of inflation is just a whisker away from the Fed’s target. In the meantime, there is now a near 90% probability of a more subdued 0.25% cut in November in terms of consensus, with a small chance of no change at all beginning to surface.

Google has criticised the DoJ’s proposal, calling them “radical” and arguing they “go far beyond the specific legal issues in this case.”

In a corporate blog post, Lee-Anne Mulholland, Google’s vice president for Regulatory Affairs, claims that the US government is pursuing “a sweeping agenda that will impact numerous industries and products”, rather than simply focusing on the issue of search contracts.

Mulholland argues that:

• Forcing Google to share your search queries, clicks, and results with competitors risks your privacy and security.

• Hampering Google’s AI tools risks holding back American innovation at a critical moment.

• Splitting off Chrome or Android would break them — and many other things

• Changes to the online advertising market would make online ads less valuable for publishers and merchants, and less useful for consumers.

• Unreasonable restrictions on how Google promotes our search engine would create friction for consumers and harm businesses.

You can read the argument here.

Also in the US overnight, attempts to end the Boeing workers strike have hit a roadblock – with the company withdrawing its pay rise offer.

Boeing and the union held their latest round of negotiations with federal mediators on Monday and Tuesday, but talks collapsed and the sides were left locked in acrimonious stalemate showing no signs of being resolved anytime soon, a person briefed on the talks said.

Nearly four weeks after the walkout began, no further negotiations were planned between Boeing and union representatives.

Both sides blamed the other for the deadlock.

“Unfortunately, the union did not seriously consider our proposals,” Boeing Commercial Airplanes head Stephanie Pope said in a note to the employees, calling the union’s demands “non-negotiable“.

Pope added:

“Further negotiations do not make sense at this point and our offer has been withdrawn.”

But, the International Association of Machinists and Aerospace Workers union said in a statement that Boeing was “hell-bent on standing on the non-negotiated offer” proposed last month.

The union said:

“They refused to propose any wage increases, vacation/sick leave accrual, progression, ratification bonus, or the 401k Match/SCRC Contribution. They also would not reinstate the defined benefit pension.”

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

Google is facing the threat of being broken up, as the US government weighs up how to tackle its monopoly in online search.

In a court document filed overnight, the US Department of Justice suggests it could seek ‘structural remedies’ such as forced product sales – to prevent Google using its Chrome browser, Android operating system and Play app store to unfairly dominate the search market. Other, less radical, options are also under consideration, though.

Introducing their case, the DoJ say:

Google’s anticompetitive conduct resulted in interlocking and pernicious harms that present unprecedented complexities in a highly evolving set of markets.

These markets are indispensable to the lives of all Americans, whether as individuals or as business owners, and the importance of effectively unfettering these markets and restoring competition cannot be overstated.

The DoJ’s “proposed remedy framework” comes a month after a US judge ruled that Google had violated antitrust law and created an illegal monopoly. The case centred on Google’s use of exclusive agreements with device makers like Apple and Samsung, in which it paid billions of dollars to make sure that its product was the default search engine on their phones and tablets.

The DoJ argues that the courts must address Google’s unlawful conduct is undoing its effects on search distribution, so rivals can compete for customers fairly.

The court filing says:

Fully remedying these harms requires not only ending Google’s control of distribution today, but also ensuring Google cannot control the distribution of tomorrow.

At this stage, the plaintiffs are only “considering” behavioral and structural remedies – legal-speak for breaking the tech giant up.

Other options include potentially restricting Google from using contracts and “monopoly profits” to control distribution channels and search-related products. Or, Google could be forced to share users’ search data with rivals.

The plaintiffs also want the remedies to be forward-looking; they could include restricting Google from using search results to train new generative artificial intelligence models and products.

They say:

Google’s ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google’s dominance.

The Justice Department is expected to file a more detailed proposal with the court by 20 November, Reuters reports, while Google will have a chance to propose its own remedies by 20 December…..

The agenda

• 7am BST: German trade data for August

• 10am BST: Post Office chief executive, Nick Read, to give evidence at the Horizon IT inquiry

• Noon BST: US weekly mortgage approval data

• 2pm BST: Bank of Israel’s interest rate decision

• 3.30pm BST: EIA oil stocks data