Primary slackens; new deals stay busy, energy names gain; funds off $335 million

Paul Deckelman and Paul A. Harris

New York, Feb. 22– After two strong sessions in a row, the high-yield primary market took a step backwards on Thursday, with syndicate sources reporting no pricings of new dollar-denominated and fully junk-rated issues during the session.

The day’s lone pricing activity came out of Europe, with French automotive equipment supplier Faurecia SA coming to market with a €700 million issue of seven-year notes.

Back in the dollar market, the sources said that price talk emerged on helicopter transportation company Bristow Group Inc.’s $300 million of five-year secured notes, with pricing seen likely on Friday.

Away from the new deals, druggist Rite Aid Corp.’s paper continued to trade actively for a third straight day, though with none of the volatility seen on Tuesday and again on Wednesday.

Oil and natural gas names like California Resources Corp., Chesapeake Energy Corp. and Whiting Petroleum Corp. firmed smartly, apparently given a lift by rebounding world crude oil prices.

Statistical market performance measures were lower all around on Thursday, their second straight session on the downside.

Another numerical indicator – the flow of investor cash into or out of high-yield mutual funds and exchange-traded funds – remained in negative territory as $335 million left those weekly-reporting-only domestic funds, although that was a considerably smaller shortfall than the yawning $6.31 billion cash hemorrhage reported last Thursday.

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