PG&E drops on bankruptcy speculation; Hornbeck mixed on exchange offer

By James McCandless

San Antonio, Jan. 8 – Tuesday in the distressed space was dominated by a utility under scrutiny and oil on the rise.

PG&E Corp.’s notes sank, taking over the volume in the distressed space as the market worried about a ratings downgrade, management changes, and a potential bankruptcy filing.

In the oil and gas space, Hornbeck Offshore Services Inc.’s issues were mixed after the company announced an exchange offer for its 5 7/8% senior notes due 2020.

While oil futures continued to rise, California Resources Corp.’s paper was mixed while QEP Resources, Inc.’s and Ensco plc’s notes were better.

Meanwhile, in the health care space, Community Health Systems, Inc.’s issues were positive after an arbitrator settled a dispute between the company and Quorum Health Corp, a 2015 spinoff.

Elsewhere in the space, Mallinckrodt plc’s paper was also gaining.

Retailer J.C. Penney Co., Inc.’s notes were higher as the market anticipated holiday sales numbers after the close.

Sector peer L Brands, Inc.’s issues were also climbing.

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