Distressed debt weaker again as Brexit news digested; uncertainties weigh on commodities

By Stephanie N. Rotondo

Seattle, June 27 – The distressed debt market was again trading lower on Monday, as investors remain wary over the United Kingdom’s vote last week to leave the European Union.

“Things in general continue to drift lower,” a trader said, though he noted that there was “not a ton of volume.

“People are still trying to grasp what Brexit really means but the uncertainty is causing risk-off in general,” he said.

Commodities in particular were taking a hit, as investors shed things like oil and gas and some metals for more “safe haven” materials, such as gold. A stronger dollar was meantime weighing on commodity prices.

For its part, domestic crude oil was down nearly 2% at $46.70 a barrel.

In the oil and gas arena, a trader saw Whiting Petroleum Corp.’s 5% notes due 2019 falling 4½ points to 89½. He also saw California Resources Corp.’s 6% notes due 2024 declining 3 points to 45¾.

At another shop, Chesapeake Energy Corp.’s 6 5/8% notes due 2020 were deemed down 2½ points at 69½.

Elsewhere in the commodity realm, Freeport-McMoRan Inc. bonds were on the more active side, but weaker with the rest of the market, according to sources.

One trader said there were “a multitude of trades” in the 3.55% notes due 2022, which he said fell over 2 points to 84½. The 3 7/8% notes due 2023 dropped 2½ points to 83¾, he said.

© 2015 Prospect News.
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