Distressed debt gains strength; NII notes on the rise; retail higher as May sales improve

By Stephanie N. Rotondo

Phoenix, June 5 – The distressed bond market ended with a positive tone to it on Thursday, traders reported.

NII Holdings Inc. paper was on the rise, though there was no catalyst to spur the movement.

The world of retail was also firming up, as the sector as a whole was said to have had better sales during the month of May.

Even Production Resource Group Inc. was up – albeit slightly – despite a cut to the company’s ratings from Moody’s Investors Service.

NII bonds firm

NII Holdings debt was up in fairly active trading, according to a trader.

The 7 5/8% notes due 2021 popped up 2¾ points, the trader said, ending at 31.

He also saw the 10% notes due 2016 rising half a point to 33½.

Another trader said the bonds were “up a bunch,” the 7 5/8% notes at 31 and the 10% notes at 33½.

There was no fresh news out on the Reston, Va.-based provider of Nextel mobile phone services in Latin America and Mexico.

Retail gains

The retail space was firming up as the sector overall was reporting higher sales for the month of May.

One trader saw Sears Holdings Corp.’s 6 5/8% notes due 2018 putting on ½ point to close at 92.

Gymboree Corp.’s 9 1/8% notes due 2018 meantime jumped 2½ points to 67½.

Another market source deemed JCPenney Co. Inc.’s 5.65% notes due 2020 up a point at 87¼.

For its part, JCPenney launched a new $2.35 billion credit facility on Thursday.

According to a Thomson Reuters tracking poll, which watches sales of eight retailers, May retail sales were up 4.6%, helped in part by warmer weather.

It was expected that sales would increase 3.6%.

Production Resource downgraded

Production Resource Group’s 8 7/8% notes due 2019 managed to gain a bit, despite getting downgraded by Moody’s.

A trader called the issue up ¼ point at 80.

Moody’s dropped its rating on the notes to Caa2 from Caa1. Additionally, the outlook was revised to negative from stable.

The rating agency said the action was due to increasing debt levels and weakening liquidity, which could hinder the company’s attempts to address deteriorating operating performance in a way that requires high levels of capital investment.

Production Resource is a supplier of entertainment and event technology.

© 2015 Prospect News.
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