Primary pauses; recent deals active; Chesapeake up on asset sale; funds lose $1.8 billion

By Paul Deckelman and Paul A. Harris

New York, May 5 – Fresh off two sessions which saw pricing activity, the high-yield primary arena fell quiet on Thursday, with no new dollar-denominated and fully junk-rated deals announced and none seen having come to market during the session.

Syndicate sources said that the upcoming week would likely be a busy one in terms of dollar-denominated deals.

Secondary traders saw continued active dealings in some of the offerings which have priced this week, including United States Steel Corp., PTC Inc., Mobile Mini, Inc. and HanesBrands, Inc.

Away from the new deals, oil and natural gas issues were the focus of the day, particularly Chesapeake Energy Corp. Its bonds were solidly higher after the big natural gas producer announced plans to sell some of its surplus acreage to Newfield Exploration Co., generating $470 million of proceeds.

It also announced quarterly results in line with analysts’ expectations.

Statistical market performance measures were lower across the board for a third consecutive session on Thursday; they had turned southward on Tuesday after having been mixed for three straight sessions before that. Thursday was the fourth such lower session in the last nine trading days.

Another numerical indicator – flows of investor cash into or out of high-yield mutual funds and exchange-traded funds, considered a reliable barometer of overall junk market liquidity trends – posted its first net outflow in five weeks, as $1.807 billion more cash left those funds than came into them.

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