Morning Commentary: Junk opens weaker on Friday; Stonegate Pub prices £80 million add-on

By Paul A. Harris

Portland, Ore., Oct. 2 – High yield bonds opened weaker on Friday, according to a portfolio manager.

ETFs were also trading off in the early going.

The iShares iBoxx $ High Yield Corporate Bd (HYG) was down 65 cents at $81.71 per share heading into the mid-morning.

SPDR Barclays High Yield Bond ETF (JNK) was down 24 cents at $35.13 per share.

Stonegate Pub Co. Financing plc priced an £80 million add-on to its 5¾% senior secured notes due April 15, 2019 (B2/B+) at 99.5 to yield 5.91% on Friday.

The reoffer price came on top of price talk.

Barclays was the bookrunner.

The Luton, England-based pub operator plans to use the proceeds to finance the acquisition of freehold properties in the Tattershall Castle Group portfolio.

Elsewhere the primary market was quiet on Friday, with no other deals expected to be priced during the session, sources said.

Mixed flows on Thursday

The cash flows of the high-yield mutual funds were mixed on Thursday, the portfolio manager said.

High-yield ETFs saw $203 million of inflows on the day.

However asset managers sustained $265 million of outflows.

The Thursday data followed earlier news that the dedicated high-yield funds saw $2.15 billion of aggregate outflows in the week to Wednesday's close.

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