Hezbollah will hand over two captured Israeli soldiers in exchange for five Lebanese prisoners in Israel, the militant group’s leader said today.

MILITARY bands and a guard of honour greeted President Michel Suleiman yesterday as he entered Lebanon’s presidential palace to begin the monumental task of uniting a wounded nation and reconciling rival political factions.

Lebanon’s feuding factions reached a breakthrough deal today that ends the country’s long political stalemate, but also gives the militant Hezbollah group and allies the key power they sought.

Heavy fighting broke out between government supporters and opponents in Lebanon’s northern city of Tripoli today.

Lebanon hung between fears of all-out war and hopes of political compromise as government supporters and opponents battled with rockets and machine guns in the mountains overlooking Beirut.

Hezbollah today said it was withdrawing its gunmen from Beirut neighbourhoods seized in sectarian clashes after the army ordered its troops to establish security and called on fighters to clear the streets.

Arab states became increasingly worried today about the worsening situation in Gaza following Israel's fuel cuts.

AN EXPLOSION targeted a US embassy vehicle yesterday in northern Beirut, killing at least three Lebanese and injuring an American bystander and a local embassy employee, US and Lebanese officials said.

Many national leaders condemned the assassination of Benazir Bhutto, but few ventured any public advice to Pakistan's leaders on how to deal with potentially explosive passions unleashed by the terrorist strike.

Prime Minister Fuad Saniora sought to calm the Lebanese today - the country's first day without a president - assuring them that the military, which has vowed to stay out of politics, is on the streets to prevent violence while deadlocked factions work to resolve the crisis.

Lebanon awoke a republic without a president today amid mounting worries over a power vacuum that has intensified the nation’s year-long political turmoil.

Lebanese President Emile Lahoud ordered the army to take over security powers today, saying the country is in a "state of emergency".

Lebanon’s parliament failed to elect a successor to President Emile Lahoud just hours before he was due to leave office today, putting the country in a potentially explosive political vacuum.

Police and army troops in Lebanon sealed off downtown Beirut today as the parliament tried to meet to elect a new head of state.

Lebanese leaders today pledged to press ahead with a divisive election for president, to be held in Parliament in the coming days, despite the car bombing assassination of an anti-Syrian MP.

A powerful bomb killed a pro-government parliament member and four others today in a Christian suburb east of the Lebanese capital Beirut, security officials said.

Lebanese soldiers fanned out along the Mediterranean coastline in northern Lebanon today, hunting for fugitives a day after the army crushed the remnants of a militant group and ended a three-month siege at a Palestinian refugee camp.

A bloody three-month siege at a Palestinian refugee camp ended in a ferocious gunbattle with 39 al-Qaida inspired militants killed, 20 captured and three Lebanese soldiers dead on Sunday.

Lebanese prime minister Fuad Saniora today declared victory over terrorism after the army seized the last Islamic militant stronghold in a northern Palestinian refugee camp in Lebanon.

ARMY and police patrols stood guard yesterday as thousands of Lebanese went to vote in a key election to replace two assassinated lawmakers in the politically torn country.

Lebanon’s rival parties, their nation in political deadlock and facing violence on its northern and southern flanks, are meeting outside Paris today for unusual, long-awaited talks.

An explosion, apparently from a bomb-rigged car, rocked Beirut’s seafront today, killing an anti-Syrian MP and nine others, security officials said.

Dozens of Lebanese army tanks and armoured carriers today pushed forward under the cover of artillery barrages against Islamic militants barricaded in a Palestinian refugee camp in northern Lebanon.

Hezbollah today denounced a UN decision to form an international tribunal in former Lebanese Prime Minister Rafik Hariri’s assassination as a “violation” of the nation’s sovereignty.

The United Nations Security Council has approved a resolution to unilaterally establish an international tribunal to prosecute suspects over the assassination of Lebanon’s former prime minister Rafik Hariri.

Heavy clashes between the Lebanese army and al Qaida-linked Islamic militants broke a week-long truce as Lebanon’s government stressed its determination to defeat the terrorists.

Hezbollah leader Sheik Hassan Nasrallah warned Lebanon not to storm a besieged Palestinian refugee camp, calling instead for a negotiated solution.

Lebanon’s prime minister vowed to wipe out an Islamic militant group barricaded in a Palestinian refugee camp, raising the prospect that the army will either storm the camp or dig in for a long siege to force its surrender.

Lebanon's prime minister today vowed to wipe out an Islamic militant group barricaded in a Palestinian refugee camp.

A senior official of a radical Palestinian faction today warned that if the Lebanese army launches an assault to wipe out an Islamic militant group barricaded in a Palestinian refugee camp, it would trigger violence in other camps.

People flooded out of a besieged refugee camp in Lebanon last night after three days of fighting between Lebanese troops and Islamic militants.

Artillery and machine gun fire echoed around a crowded Palestinian refugee camp today as the Lebanese government ordered the army to finish off the Fatah Islam militants hiding there.

Artillery and machine gun fire echoed around a crowded Palestinian refugee camp today as fighting resumed between besieging Lebanese troops and Islamic militants holed up inside, ending a nighttime lull.

France’s new foreign minister today condemned a deadly bomb attack near a busy Beirut shopping centre, and reaffirmed the importance to France of Lebanon’s sovereignty and stability.

The UN Security Council expressed “serious concern” last night at mounting reports of illegal arms transfers from Syria to Lebanon and authorised an independent mission to be deployed quickly to assess how the frontier is being monitored.

A small bomb at the American University of Beirut was defused by police today.

Lebanon’s Hezbollah leader, Hassan Nasrallah, today vowed to continue the opposition campaign led by his militant group to force Prime Minister Fuad Saniora to share power or step down.

Bomb blasts hit a pair of commuter buses in a co-ordinated attack that killed three people near Beirut today, on the eve of a massive rally marking the 2005 assassination of Lebanon’s former prime minister.

Lebanese prime minister Fuad Saniora today denounced what he called Israel’s violation of the Lebanese border, an act that provoked the first exchange of fire between the two countries’ forces since just after last year’s war between Hezbollah and Israel.

Government and opposition supporters clashed at a Beirut university campus today, battering each other with sticks, stones and even pieces of furniture in new violence spilling over from Lebanon’s political crisis.

International donors today pledged $7.6bn (€5.9bn) in aid and loans for Lebanon’s US-backed prime minister and his economic reform programme for the war-scarred country.

Lebanon’s prime minister today abruptly pulled out of an international gathering of world political and business leaders in Switzerland, reflecting tensions in his nation.

International donors today gathered in Paris to drum up new funding for Lebanon’s embattled government, but there were concerns that recent violence there might dent nations’ willingness to donate.

Life was returning to normal in the Lebanese capital and around the country today, a day after violent confrontation between government supporters and opponents killed three people and wounded dozens in the worst escalation of the Hezbollah-led opposition’s campaign to topple Prime Minister Fuad Saniora’s Western-backed Cabinet.