Distressed energy names gain with oil; DFC Global notes take dive; rue21 paper trades down

By Stephanie N. Rotondo

Seattle, July 14 – Distressed debt investors were focused on typical “go-go” names in Thursday trading, though there were a few exceptions, market sources reported.

The energy space was receiving a fair bit of attention, as domestic crude oil prices rebounded from Wednesday’s lows. The commodity had dropped about 4% in midweek trading, as fresh inventory data showed that a global supply glut was very much in place.

But as the dollar weakened – and some saw Wednesday’s crash as overdone – oil rallied 1.63% to $45.48 a barrel.

A trader said there was “a ton of trading” in California Resources Corp.’s 8% second-lien notes due 2022. He called the issue up nearly 2 points at 74.

The trader also saw Chesapeake Energy Corp.’s 8% second-lien notes due 2022 ticking up almost a point to 90¾.

Denbury Resources Inc.’s 6 3/8% notes due 2021 were seen rising a deuce to 75 bid.

Away from energy, in the realm of rarely traded issues, a trader said Malvern, Pa.-based non-bank consumer lender DFC Global Corp.’s 10½% notes due 2020 took a dive during the session.

The paper started the day down 6 to 7 points, he said, but ultimately closed off “almost 15 points” at 45¼.

Also, rue21 Inc.’s 9% notes due 2021 declined 3 points from the last trades a month ago, ending at 35.

There was no fresh news out on the Warrendale, Pa.-based retailer.

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