Credit Suisse notes active; Goldman preferreds soft; Qurate Retail finds footing

By Cristal Cody

Tupelo, Miss., Dec. 2 – Credit Suisse Group AG moved back to the spotlight with the junk securities trading mostly lower before seeing gains on Friday and the firm’s credit default swap spreads more than 130 basis points wider this week.

The perpetual notes traded about 1¾ points to more than 4 points higher over the session.

The 9¾% perpetual securities (/B) recovered 3 1/8 points by the close with the issuer among the most active names seen in the secondary market.

Credit Suisse’s securities traded down as much as 6 points plus earlier in the week.

The company reported in November it was accelerating a “radical restructuring” of its investment bank.

Other financial preferred securities also have been active in the secondary market.

Goldman Sachs Group Inc.’s 4% perpetual securities (Ba1/BB+) fell 1¾ points over Friday’s session, a source said.

The issue was quoted at 76¼ bid on less than $1 million of paper traded.

Goldman’s other preferred securities, including the 6.3% perpetuals (Ba1/BB+) and the 7.466% perpetuals (Ba1), were down more than 1 point over the week, including the 7.466% perpetuals (Ba1) that fell nearly 1½ points on Thursday.

Markets were mixed following an upbeat U.S. jobs report on Friday.

The iShares iBoxx High Yield Corporate Bond ETF declined 6 cents, or 0.08%, to $75.56.

The CBOE Volatility index moved down 4% to $19.05.

The Labor Department reported that November employment rose by 263,000, higher than a 200,000 forecasted gain, while the unemployment rate was unchanged and in line with market expectations at 3.7%.

Distressed home shopping network owner Qurate Retail Inc. saw good news this week with the company’s paper and CDS spreads better.

The home shopping network owner’s 8½% senior debentures due 2029 (B2/B-) added more than 2 points on Friday.

The company, formerly known as Liberty Interactive Corp., also posted tighter CDS spreads by more than 100 bps for the past week.

Credit Suisse eyed

Credit Suisse’s junk perpetual securities mostly declined this week before seeing gains of about 1¾ points to more than 4 points on Friday, according to market sources.

The 9¾% perpetual securities (/B) recovered 3 1/8 points by the close with the issue among the most active names seen trading on $14 million of volume, a source said.

The securities were quoted at 85¾ bid and yielding over 14%.

On Thursday, the perpetuals dropped 3¾ points on $2 million of supply.

Credit Suisse’s other junk securities also were trading stronger on Friday in light activity.

The 6 3/8% perpetuals (B1/B) rose 1¾ points to 66 bid on $2 million of volume.

The issue was down 6 points on Wednesday.

Meanwhile, Credit Suisse (USA) Inc.’s CDS spreads widened 137 bps over the past week ended Wednesday to 501 bps from a spread of 363 bps in the prior week, according to a Moody’s Investors Service report.

The USA branch also had implied ratings declines to A2 as of Wednesday from Aa3 a week earlier, Moody’s said.

Credit Suisse made several moves in November, including agreeing to sell a significant part of its securitized products group to Apollo Global Management and tapping the high-grade primary market with a $2 billion offering of 9.016% notes due 2033 (Baa2/BBB) as part of its restructuring.

The Zurich- and New York-based issuer’s stock was up 9.39% on Friday at $3.38.

Qurate stronger

Qurate Retail’s 8½% senior debentures due 2029 (B2/B-) traded more than 2 points higher on Friday on a 54 handle, a source said.

Trading in the bonds, issued by Liberty Media Corp., was on the light side at under $2 million.

Qurate’s CDS spreads also improved this week, Moody’s said.

The West Chester, Pa.-based home shopping network owner’s CDS spreads tightened 110 bps over the week ended Wednesday to 1,710 bps.

Distressed returns jump

S&P U.S. High Yield Corporate Distressed Bond index one-day returns climbed to 1.06% on Thursday from 0.26% on Wednesday, minus 0.34% on Tuesday and 0.11% on Monday.

Month-to-date total returns so far in the first session of December were 1.06%. November returns finished at 0.3% on Wednesday.

Year-to-date total returns improved to minus 24.66% on Thursday from minus 25.45% on Wednesday, minus 25.43% on Tuesday and minus 25.38% at the week’s start.

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