Valeant Pharmaceuticals declines; Intelsat dwindles; little follow-through in Claire’s

By Stephanie N. Rotondo

Seattle, July 13 – A distressed debt trader said there was “a little respite from the recent high-yield feeding frenzy” on Wednesday, thus resulting in a weaker tone to the market.

The trader said most names traded off half a point to a point on the day, with some losing even more by the bell.

Valeant Pharmaceuticals International Inc. was one such loser, as its bonds declined as much as 2 points during the midweek session. The downward move came as Andrew Left of Citron Research said he was once again short on the company’s stock.

The bonds were also pressured by news the company’s former chief executive officer had slashed his holdings in the company.

Intelsat SA paper was also trending lower, though there wasn’t any fresh news to explain the decline.

As for Claire’s Stores Inc.’s 9% notes due 2019, those bonds were “bid lower than yesterday” at 53, according to a trader.

However, the trader noted that there was little follow-through in the name after the company announced a weak forecast for the second-quarter.

In an 8-K filed on Monday, the Pembroke Pines, Fla.-based retailer said that as of July 10, same-store sales were down 5.9%, consisting of a decline of 4.2% in North America and an 8.6% decrease in Europe. Expectations for adjusted EBITDA were placed between $37 million and $41 million for the second fiscal quarter, which compared to $59.9 million the year before.

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