Distressed debt quiet amid major winter storm; energy stays strong, retailing names gain

By Paul Deckelman

New York, Jan. 4 – Traders said that things were quiet on Thursday in the market for distressed debt and for the notes and bonds of otherwise underperforming companies and sectors, in line with a generally subdued overall high-yield bond market, chilled and stilled by the giant winter storm which slammed into New York and other major northeastern business centers.

But the energy sector remained red hot, fueled by a continued rise in crude oil prices to levels not seen since at least early 2015. That in turn pushed up oil and natural gas sector benchmark California Resources Corp., as well as peers such as EP Energy Corp., MEG Energy Corp., Denbury Resources Inc. and drillers Noble Holding International Ltd and Ensco plc.

Away from the energy realm, Rite Aid Corp. – whose bonds fell on Wednesday after the retailer released quarterly numbers that fell short of analysts’ expectations – was on the rebound.

Other sector names also seen better included J.C. Penney Co. Inc. and PetSmart Inc.

Another gainer was Canadian drug manufacturer Valeant Pharmaceuticals International Inc.

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