Coal pressured, report says met coal prices have further to fall; Gymboree turns downward

By Stephanie N. Rotondo

Phoenix, Sept. 18 – The coal sector continued to be under pressure in distressed debt trading on Thursday.

The space has been struggling anyway, as metallurgical coal prices have tanked along with demand. But on Thursday, Goldman Sachs released a report that speculated prices have not yet hit a floor, further pressuring the sector.

“Coal is just getting its teeth kicked in, period,” a trader said.

Walter Energy Inc.’s bonds “keep getting beat up,” one trader said.

Arch Coal Inc. was also down, and quite sizably, according to a trader.

“They have been saying they are going to start idling [some operations],” he said.

Away from coal, recently topical names stayed on the radar.

A trader said Gymboree Corp.’s 9 1/8% notes due 2018 were “not as active as it has been,” but were still moving around. In Thursday trading, the bonds – which have been attempting to recover ground lost in the wake of dismal earnings released Sept. 11 – once gain reversed direction, giving up the ground it has gained in the last couple of sessions.

NII Holdings Inc. was meantime continuing to move higher, as it has been since the company filed for Chapter 11 protections on Monday.

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