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Distressed metals and mining names rally; Intelsat bonds spiral downward on earnings news
By Stephanie N. Rotondo
Seattle, Feb. 22 – With the broader markets trending upward on Monday, distressed bonds were also largely better on the day.
In particular, metals and mining names were benefitting from a rally in commodity-linked stocks. For instance, Freeport-McMoran Inc.’s debt improved about 2 points on the day, according to a trader.
He saw the 2 3/8% notes due 2018 closing up over 2 points at 78¾, while the 3.55% notes due 2022 gained nearly 3 points to end at 57¼.
The 3 7/8% notes due 2023 rose a deuce to 56¼, the trader said.
FMG Resources Ltd. was another commodity name that moved up. A market source pegged the 6 7/8% notes due 2022 at 68, a gain of 2 points.
Even struggling steel producer AK Steel Holdings Corp. finished the day with a firm tone.
One trader saw the 7 5/8% notes due 2021 adding a point to close at 38 7/8. Another source placed the 7 5/8% notes due 2020 at 43½, up 3 points.
But the real focus of the day was Intelsat SA, which released its fourth-quarter results on Monday. While the earnings were mixed compared to analysts’ forecasts, word that the company had hired Guggenheim Securities to look into “financing and balance-sheet initiatives” really drove the company’s debt downward.
A trader said the debt was “pretty active and lower,” with the paper losing 8 to 10 points on the day.
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