Midday Commentary: Quiet market opening; airlines seen firmer after AMR court filing

By Paul Deckelman

New York, Aug. 23 - The high-yield market got off to a quiet start that one trader called "typical for a Friday in late August."

A second trader saw the market little changed, although he opined that "the airlines continue to feel firmer, especially with more buyers in AMR."

The Fort Worth, Texas-based airline operator's 6¼% notes due 2014 moved up by 2¼ points on Thursday, a market source said, closing at 98½ bid on round-lot volume of over $6 million, considered respectably busy during a normally quiet summer session.

AMR and prospective merger partner US Airways Group Inc. filed court papers in Washington on Thursday seeking a relatively early start, in November, to the trial on the Justice Department's lawsuit seeking to block that combination on anti-trust grounds.

The government, meanwhile, wants the trial to start in February.

The government's surprise legal move earlier this month threw a wrench into the works as far as AMR's exit from bankruptcy proceedings, which is now on hold while the two sides litigate the federal complaint, or possibly try to reach a settlement that would address the DOJ's objections.

The merger is the key focus of the company's reorganization plan.

Away from the airlines, other active issues in the early going Friday included El Paso Corp.'s 7% notes due 2017, HCA Inc.'s 7½% notes due 2022 and Ball Corp.'s 4% notes due 2023.

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