Chesapeake Energy declines as capex cut, loss widens; U.S. Steel wanes post-earnings

By Stephanie N. Rotondo

Seattle, Nov. 4 – Distressed debt investors were zeroing in on Chesapeake Energy Corp. on Wednesday after the oil producer cut its capital expenditure budget yet again.

The Oklahoma City-based company also reported a wider-than-expected loss for the quarter. Bonds weakened in response to the news.

Also weaker were U.S. Steel Corp.’s bonds. The steelmaker reported disappointing results after the market closed Tuesday.

However, a trader noted that there were “not a lot of trades” in the name.

In other earnings news, Avon Products Inc. paper declined in response to the cosmetics company’s hefty quarterly loss.

Looking ahead, Chemours is slated to bring its latest financial statement out on Thursday. Ahead of the numbers, a trader said the 6 5/8% notes due 2023 gained a point to close at 75¾.

A trader said Chesapeake Energy’s 5¾% notes due 2023 were “very active” on news the company had cut its capex budget for the second time this year.

The trader pegged the issue at 64, down nearly a point. The 4 7/8% notes due 2022 fell 1½ points to 63, as the 6 5/8% notes due 2020 waned almost 2 points to 68.

Another market source saw the 6 5/8% notes at 68½ bid, down a point.

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