GOL downgraded by Deutsche Bank, Virgin Blue slumps on proposed capital raising and loss forecast;

Worldwide LCC share prices were mixed on Friday (25-Jul-09), reflecting underlying conditions in European, Asian and North American equity markets and increased oil prices. Oil prices in New York climbed USD 89 cents to close at USD68.05, due to growing optimism of an improving US economy, while in London, oil prices for September delivery jumped USD1.07 to settle above USD70/barrel (at USD70.32).

Virgin Blue led the decliners on Friday, down 1.7%. The carrier has since requested a trading halt of its shares today (27-Jul-09), pending the outcome of a proposed capital raising. Virgin Blue plans to launch a fully underwritten equity raising of approximately AUD231.4 million to improve liquidity and provide increased financial flexibility. The carrier also stated it expects an underlying trading result for FY2009 (including V Australia) of between breakeven and a loss of AUD10 million after tax.

GOL's shares also slipped on Friday, by 1.1%, as Deutsche Bank lowered its rating from “buy” to “cut” and warned that “the time for investors to take profits is now, ahead of noisy second-quarter results that may stir concerns about increased price discounting and competition”. The LCC’s stock has surged 37% this month, compared with a 5.8% rise in the benchmark Bovespa stock index.

Also in the Americas, Southwest jumped 4.5%, with Allegiant, WestJet, AirTran and JetBlue also gained. In Europe, Ryanair and easyJet were both down, by 0.8% and 0.7%, respectively, while Air Berlin gained 2.5%.

Selected LCCs daily share price movements (% change): 24-Jul-09