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Virgin Blue Holdings Limited (VBA) said it has signed an agreement with aircraft manufacturer Boeing for up to 105 brand new 737 aircraft. The company said this completes the in-principle agreement, which was signalled at the recent half-year financial results briefing.

Virgin said the completion of the transaction constitutes the biggest aircraft order in Virgin Blue’s ten-year history and the Boeing Aircraft Company’s largest order in the past 18 months.

The company said the agreement includes 50 firm B737-800NG aircraft, 25 additional firm delivery positions secured as options and 30 future purchase rights.

Delivery is scheduled from June 2011 through to 2017.

Chief executive, Brett Godfrey, said the agreement places Virgin Blue in a strong position to prepare for steady future growth as domestic and short haul markets recover.

“It will also ensure a turnover of aircraft to maintain the youngest fleet of modern aircraft which is crucial for maintaining our commitment to on-time performance and the lowest cost base possible,” Mr Godfrey said.

Virgin said the new aircraft would deliver a further reduction in operating costs to manage the airline’s future cost base, maximise reliability and continue to bring to market modern airline products and services.

Brett Godfrey said pricing could not be disclosed but added that importantly net pricing is improved from 2001 levels, allowing for a lowering of the fleet’s cost base.

As at 1041 AEDT, Virgin Blue shares were up 1c to 71.5c.

Western Areas NL (WSA) is pleased to announce that high grade nickel production has commenced at the Tim King Pit at Spotted Quoll, two weeks ahead of schedule. 1,600 tonnes of supergene sulphide mineralisation averaging 4.8% nickel (containing 77.2t nickel) has been mined since 29th March. This is in addition to 3950 tonnes of oxide mineralisation averaging 3.0% nickel (containing 120t nickel) already mined from the top of the deposit. Western Areas said this mineralisation was located above the current ore reserves at Spotted Quoll and the Company is considering a number of options available to treat this high grade material. 

Citi has downgraded TTS (HOLD, price target $2.60) citing headwinds to outperformance. The broker also cited weaker spending margins in Victorian gaming.

Citi said spending trends in Victorian gaming are also weak in early 2H10. Going forward Citi said the market would continue to lag given the absence of stimulus payments.

TTS lags TAH in share in this market, and given regulatory delays in opening new venues and relocating machines, is unlikely to claw back share in the twilight years of the license.

Citi noted that longer-term execution in NSW Lotteries looks promising, however the broker argued that the absence of stimulus payments in CY10 and rising interest rates will place further pressure on earnings momentum, creating a headwind for outperformance.

Rio Tinto Limited (RIO) said it has received a binding offer from Sun European Partners, LLP to acquire the Alcan Beauty Packaging business. Australia’s second largest miner said a period of exclusivity with Sun European Partners has been agreed, with Rio Tinto to respond to the offer following consultation with the relevant European works councils.

Chief financial officer, Guy Elliott, said the offer was an important step towards completing the divestment of the Alcan Packaging businesses.

“We believe the offer is in the interests of all stakeholders and represents a good outcome for our shareholders.”

Rio Tinto said the Beauty division employs around 8,000 people, operates 26 plants in 12 countries, and is the only part of Alcan Packaging still owned by Rio Tinto, with the exception of the Medical Flexible operations in the US, which remains the subject of an agreed transaction with Amcor.

The company has now completed divestments in excess of $10 billion since the beginning of 2008.

At the close of trade Wednesday, Rio Tinto shares were trading at $78.40.

Lihir Gold Limited (LGL) said it has rejected an offer from Newcrest Mining Limited (NCM) to acquire 100% of Lihir’s issued ordinary shares through a scheme of arrangement. Lihir also announced the appointment of former BHP senior executive Graeme Hunt as Managing Director and CEO.

Lihir said the offer, received on 29 March, was on the basis of one Newcrest share for every nine Lihir shares plus $0.225 cash per Lihir share, less any interim dividend declared for the half year ended June 2010.

The company said based on Newcrest’s closing share price as at 31 March 2010, the offer was equivalent to $3.87 per share and valued the company at approximately $9.2 billion.

Lihir’s directors determined that the offer did not represent good value for LGL shareholders.

Lihir chairman, Ross Garnaut, said the offer undervalued the company, both in terms of its existing business, and in terms of the potential value the company expects to deliver in the future.

“It also did not include a sufficient premium for control,” Dr Garnaut said.

Lihir said it provided Newcrest with access to limited due diligence items, subject to a confidentiality deed and nine month standstill agreement.

”We have major growth projects currently being developed in PNG and in West Africa, which will deliver increasing returns over the coming years, lifting average annual gold production by approximately 40% from current levels to 1.45 million ounces from 2012 to 2016,” Mr Garnaut said.

“There is considerable option value in the huge gold resource at Lihir Island, which increased 31% to 43 million ounces in 2009, and also in the company’s assets in West Africa.”

Mr Garnaut went on to say the board is strongly of the view that the company is undervalued in the marketplace and that the Newcrest offer failed to provide full value for the underlying assets with an appropriate takeover premium.

Meanwhile, Mr Garnaut said Mr Hunt was the ideal candidate for the CEO role due to his knowledge of the mining industry and extensive experience, including 34 years with BHP Billiton.

Mr Hunt’s most recent role at BHP was President of Uranium before leaving the company in March 2009.

At the close of trade yesterday, Lihir shares were trading at $3.03, while Newcrest shares were trading at $32.82.

CSR Limited (CSR) said this morning it has received a sweetened offer from Chinese food group, Bright Food, for its spin-off sugar business, Sucrogen. Under the new offer, Bright Food said it would pay an extra $250 million, for the business, bringing its total offer for Sucrogen to $1.75 billion.

CSR, in response, said it would explore the new offer further, entering into discussions with the food group.

At the same time CSR would also continue to look into demerging its sugar business, as has been previously announced. However the takeover offer from Sucrogen would almost certainly be a more attractive proposition following the federal court’s recent decision to block the demerger of its sugar business on concerns it would not be able to pay outstanding asbestos claims.

CSR said there was no guarantee the takeover would go ahead as it remains conditional on due diligence, regulatory approvals and execution of transaction documentation.

At the close of business Wednesday, CSR shares were trading at $1.665 each.

A late sell-off saw Wall Street close lower on the last day of the first quarter as investors locked in profits. The market is eagerly awaiting the release of the government report on unemployment, due out Friday.

Despite the fall the Dow finished the quarter 4.1% higher, making it the best first quarter for the index in 11 years. 

In employment news, according to the ADP monthly report 23,000 jobs were cut by private-sector employers in March after 24,000 jobs were lost the previous month. Forecasts were for an increase of 40,000 jobs.

In economic news, the Chicago PMI fell from 62.6 the previous month to 58.8 in March. Economists forecast the regional reading on manufacturing to decrease to 61.

Meanwhile, the Census Bureau reported factory orders for manufactured goods increased a slightly better than anticipated 0.6% in February. Factory orders rose 2.5% in January.

The Dow Jones dropped 50.79 points, or 0.47%, to 10,856.63, the S&P's 500 shed 3.84 points, or 0.33%, to 1,169.43 and the NASDAQ lost 12.73 points, or 0.53%, to 2,397.96.

The heavyweight financials were within 1% either side of the gain line. Citigroup and Goldman Sachs weakened 1% and 0.4%, while JPMorgan, Bank of America and Wells Fargo were between 0.4% and 0.9% higher.

Cisco and Microsoft led tech stocks lower, shedding 2.3% and 1.6% respectively.

Research in Motion lost 1.3% before the BlackBerry maker released its quarterly earnings after the close of trade. The company missed expectations with a profit of US$710.1 million, or US$1.27 per share, on revenue of US$4.08 billion. Forecasts were for earnings of US$1.28 per share on revenue of US$4.31 billion.

However, the company forecast earnings of between US$1.31 and US$1.38 per share for the current quarter, beating analysts’ estimates of US$1.23 per share.

Boeing fell 1.3% as it expects a 20c per share reduction in first-quarter earnings as it will no longer be able to claim an income tax deduction related to prescription drug benefits provided to retirees as a result of the health-care legislation.

Exxon Mobil and ConocoPhilips slid 0.1% and 0.2% despite a rise in the price of crude. Chevron added 0.7%.

NYMEX light crude oil for May delivery rose US$1.39 to settle at US$83.76 a barrel.

COMEX gold for June delivery added US$7.80 an ounce to US$1,116.10.

European Markets

European stocks retreated on the back of an unexpected fall in ADP’s monthly jobs report in the US and Moody’s downgrading of some Greek banks. Financials led the slide, while miners countered following a mainly positive session for metals prices in London.

The UK benchmark FTSE 100 added 7.32, or 0.13% to 5,679.64. The French CAC40 shed 13.40, or 0.34% to 3,974.01, while the German DAX advanced 11.10, or 0.18% to 6,153.55.

French bank BNP Paribas fell 2.5%, while Germany’s Deutsche Bank lost 1.6%. 

UK banks faired better with Lloyds and Royal Bank of Scotland gaining 2.3% and 1.7%.  Barclays added 0.6%, while HSBC shed 0.3%.

EFG Eurobank Ergasias and National Bank of Greece slumped after Moody’s cut the Greek bank’s debt ratings.

Bank of Ireland surged 24% after the National Asset Management Agency said Ireland’s banks require $43 billion in new capital. The central banks gave the major banks one-month to decide how they will raise the capital.

Among the miners Xstrata and Anglo American put on 1.5% and 1.4%.

Rio Tinto rose 0.2%, while Aussie peer BHP Billiton shed 0.4%.

BG Group was the best of the energy majors, adding 0.8%. 

British Sky Broadcasting rallied 3.4% after market regulator Ofcom said it would limit the requirements of the pay-television provider to offer its channels to competitors.

Japanese Markets

Japan’s Nikkei fell of 18-month highs as investors booked profits on the popular belief the recent rally was overdone. Electric appliance makers were the major drag after outperforming the market in recent months.

The Nikkei 225 climbed 110.67, or 1.01% to 11,097.14.

Mitsubishi UFJ Financial and Sumitomo Mitsui Financial lost 1.4% each on concerns the government may double the cap on deposits at Japan Post, therefore directing deposits away from lenders.

A price target cut sent brokerage Nomura Holdings’s shares 1.9% lower. 

Sony and Panasonic dipped 0.8% and 0.6%, while Toshiba fell 1%.

Automaker Toyota slid 0.7%, while Mazda climbed 4.8%.

Hong Kong Markets

The Hang Seng edged lower Wednesday as the Hang Seng posted a decline over the March quarter after the three previous quarters rose. Ironically, it was property stocks, which have been so strong for the index in the past, which lost ground Wednesday.

The Hang Seng lost 135.44, or 0.63% to 21,239.35.

Many of the banks helped cap losses Wednesday, with Bank of China adding 0.5%, while China Construction Bank rose 1.6%. Bank of Communications jumped 4.4% after posting a bigger than expected profit for last year.

However those gains were countered by a 1.2% fall from heavyweight HSBC.

Among the property stocks, Henderson Land Development dropped 4.2% after its profit missed estimates.

Meanwhile, China Oilfield Services slumped 6.9% after painting a challenging outlook for the company.

Aluminum Corp of China lost 1.4%. Chalco said it was looking to phase out unprofitable production of aluminium over the next three years. 

Australian shares stumbled in afternoon trade to finish 0.8% lower after the release of a slew of disappointing economic reports. Every sector finished in the red with resource and banking stocks taking the most points off the broader indices.

In economic news, total credit provided to the private sector by financial intermediaries rose by 0.4% over February 2010, following an increase of 0.4% over January. Over the year to February, total credit rose by 1.6%.

Elsewhere, according to the Australian Bureau of Statistics retail sales unexpectedly fell 1.4% in February following a 1.1% increase in January. Forecasts were for a 0.3% rise in sales for the month, with the drop attributed to four official interest rate hikes since October.

The ABS also reported a 3.3% drop in monthly building approvals during February. Forecasts were for a rise in excess of 2%.

At the end of the day, the All Ords lost 33.7 to 4,893.1, while the ASX/200 shed 41.3 to 4,875.5. Around 2.3 billion shares worth around $6.1 billion had changed hands.

Among the major market movers today were the coal stocks as a result of Macarthur Coal receiving a takeover offer from US coal giant, Peabody. However, the company’s board said it believes the $3.3 billion offer is not in the best interests of shareholders.

Macarthur shares climbed 16.2% to $14.05, while Whitehaven Coal rallied 21c, or 4.3% to $5.13 and Centennial Coal added 2.7% to $4.36 on the news.

BHP Billiton lost 82c, or 1.8% to $43.59. Rio Tinto was 85c lower at $78.40, while the Energy sector’s major player Woodside edged 10c below the line to $46.90.

Elsewhere Gindalbie Metals rose 5.5% to $1.245 following yesterday’s finalisation of an off-take agreement with an Asian steel producer.

Lihir Gold and Oz Minerals fell 2.3% and 2.6% respectively.
 
The Materials and Resources sector lost 1.2%, while the Energy sector dipped 0.2%.

The Banks and Financials sector weakened 0.9%.

The big four banks all edged lower. Westpac and CBA slid 1% and 0.8% to $27.84 and $56.29.

NAB lost 18c to $27.52 as it agreed to terms with AXA Asia-Pacific and its French parent company for NAB to purchase the Australian and New Zealand businesses of AXA APH for $4.6 billion as part of a proposal to acquire all of the shares in AXA APH.

AXA APH shares slid 3c to $6.32.

Australia’s largest insurer QBE lost 22c to $20.83. At the company’s AGM this morning QBE said it was in track to meet insurance profit margin of between 16% and 18%.

AMP lost 12c, or 1.9% to $6.26, while investment bank Macquarie dropped 2.9% to $47.25.

Bourse operator ASX fell $1.09, or 3.1% to $33.94. The company is set to face competition as not the only market operator in the country.

Property Trusts finished mainly lower following a mixed morning, with the sector closing 0.9% lower due largely to a % drop to $ from Westfield.

The unexpected slide in retail figures hurt the retailers.

David Jones and JB Hi-Fi  lost 2.1% and 1.9% to $4.75 and $20.30 respectively.

The media stocks were generally flat. Ten Network climbed 4.5c, or 2.4% to $1.90 after reporting a $58.6 million profit for the six months to 28 February, a swing from an $80 million loss in the previous economic period.

The Consumer Discretionary weakened 0.5%, while Consumer Staples were 0.4% lower despite a gain of 7c, or 0.2% to $31.79 from Wesfarmers.

Woolworths lost 24c, or 0.8% to $28.00.

Among Industrial stocks, Brambles and Leighton shed 4c and 28c to $7.36 and $39.00 respectively.

Boart Longyear was the standout as the mining services company added 3.1%, bringing two-day gains to around 10%.

Airline stocks were lower, with Qantas and MAp Group lost 1% each, while Virgin slumped 2.1%.

The sector was 0.2% lower.

Sigma Pharmaceutical shares slumped 48.3% to 46.5c after the company posted a post-tax loss of $389 million for the year ended January 31, 2010. The company’s shares traded for the first time in over one-month following the release.

The Healthcare sector shed 1%

Telstra lost another 3c to $2.99, while Hutchison jumped 9.1% to 12c.

The Telecommunications sector fell 0.9%.

Around the region, the Nikkei 225 advanced 30.3 to 11,127.4, while the NZSE50 gained 18.3 to 3,268.0. The Strait Times Index retreated 17.9 to 2,915.5. The Hang Seng shed 34.9 to 21,339.9.

Spot gold was trading at US$1,106.10 per ounce, while the Aussie was buying US$0.9153. 

Retail sales and building approvals fall
The Australian Bureau of Statistics reported an unexpected 1.4% fall to $19.8 billion in retail sales in February following a 1.1% increase in January. The ABS also released the monthly building approvals figures, which revealed a 3.3% drop in the number of dwelling units approved in February.

Sigma share price plummets on $389m loss
Sigma Pharmaceuticals reported a post-tax loss of $389 million for the year ended January 31, 2010, from a profit $80.1 million in the previous corresponding period. The result, coupled with other financial pressures on the company, sent the Sigma's share price into a tailspin, down 40c to 50c as it resumed trading this afternoon for the first time in more than a month.

At the end of the day, Sigma shares were down 43.5c, or 48.3% to 46.5c.

Peabody makes $3.3bn bid for Macarthur
Macarthur Coal confirmed Peabody Energy Corporation has offered to acquire all the shares in Macarthur for cash consideration of $13.00 per share. However, the company's board said it believes the offer is not in the best interests of shareholders.

Ten posts $58.6m half-year profit
Ten Network Holdings has reported a $58.6 million profit for the six months to 28 February, a swing from an $80 million loss in the previous economic period. However, more significantly, the network said its underlying post-tax profit rose a more modest 3%, to $58.7 million, from $56.8 million.

By the close, Ten shares were 4.5c higher at $1.90.

ACCC blocks GFF fats saleThe Australian Competition and Consumer Commission (ACCC) this afternoon said that it would oppose Goodman Fielder Limited's (GFF) sale of its edible fats and oils business to Cargill Australia. The $240 million sale to Cargill was first proposed in December 2009 following a May 2009 that it was looking for a buyer following its decision to streamline the business and focus on consumer brands.

Goodman Fielder shares were down 4c to $1.44 at the close.

NAB and AXA agree to terms
National Australia Bank has agreed to terms with Asia Pacific Holdings and its French parent AXA to purchase the Australian and New Zealand businesses of AXA APH for $4.6bn as part of a proposal to acquire all of the shares in AXA APH. NAB said as part of the proposal AXA has agreed to purchase the Asian businesses of AXA APH for $9.4 billion.

At the end of the day, NAB shares were dow 18c to $27.52, while AXA APH shares were down 3c to $6.32.

QBE on target in 2010
QBE said it was on track to meet its targeted full year insurance profit margin of between 16% and 18%. The insurer said that the outlook meant it was likely that they could maintain its dividend in 2010.

By the finish, QBE shares were trading down 22c to $20.83.

Monadelphous Group and AnaeCo form JV
Monadelphous Group and AnaeCo have formed a joint venture to deliver design-and-construct waste management solutions using AnaeCo’s patented DiCOM bioconversion system. Monadelphous said the JV would target projects for local government authorities and waste service companies which want alternative waste technology solutions to replace landfill disposal.

At the finish, Monadelphous shares were down 15c to $15.30.

The Australian Competition and Consumer Commission (ACCC) this afternoon said that it would oppose Goodman Fielder Limited's (GFF) sale of its edible fats and oils business to Cargill Australia. The $240 million sale to Cargill was first proposed in December 2009 following a May 2009 that it was looking for a buyer following its decision to streamline the business and focus on consumer brands.

"The ACCC investigation found that the proposed acquisition of the Goodman Fielder assets by Cargill would lead to a significant concentration of refining assets in

Australia and remove one of only a small number of competing refiners that offer a wide range of fats and oils products," ACCC chairman Graeme Samuel said today.

Goodman Fielder shares lost 4c, or 2.7% to $1.44 immediately following the announcement.

The Australian Bureau of Statistics reported an unexpected 1.4% fall to $19.8 billion in retail sales in February following a 1.1% increase in January. The ABS also released the monthly building approvals figures, which revealed a 3.3% drop in the number of dwelling units approved in February.

The surprising declines have already fuelled speculation that the Reserve Bank will keep the official interest rate unchanged when it meets next Tuesday. 

Forecasts were for a 0.3% rise in retail sales for the month, with the drop largely attributed to the four official interest rate hikes since October.

The ABS said sales dropped, in seasonally adjusted terms, across five industry groups, with New South Wales recording the largest decline in sales with a 2.5% fall.

The only state and territory to see an increase in sales during February were Tasmania (1.5%) and the Northern Territory (0.8%).

The ABS said trend turnover for February 2010 rose 0.1%.

Looking at the building approvals figures, South Australia witnessed the largest fall with a 23.3% drop. In Australia’s most populous state, New South Wales, approvals slumped 14.6%.

Forecasts were for building approvals nationally to rise in excess of 2%.

After two-months of increases the number of approvals for private sector houses declined 0.9% during February, with New South Wales lagging once again, this tie with a 10.4% fall.

The ABS said the value of total building approved fell 4.5% in February, while the value of total residential building approvals rose 1.2% and non-residential building approvals fell 13.0%.

Meanwhile in separate data released today by the RBA, total credit provided to the private sector by financial intermediaries rose by 0.4% over February 2010, following an increase of 0.4% over January.

Over the year to February, total credit rose by 1.6%.