Distressed debt rattled, follows broad market; Walter Energy issues earnings, bonds weaken

By Stephanie N. Rotondo

Phoenix, July 31 – The distressed debt market was “getting tagged,” a trader said Thursday, as an Argentinean default and ongoing tensions in Russia worried investors.

For its part, the Dow Jones industrial index was down 317 points on the day, erasing all of the gains incurred thus far in 2014.

“Down, down and more down,” a trader said.

Walter Energy Inc. debt was “one of the more active of the downtrodden,” according to a trader. The company reported earnings that mostly fell short of expectations. Walter also lowered its 2014 projections.

The quarterly report combined with a broader market already under pressure led the bonds to decline by over 5 points on the day.

Even without news to act as a driver, many distressed names struggled during the session.

Caesars Entertainment Corp.’s 10% notes due 2018 fell over 2 points to 32½, a trader said. The 10¾% notes due 2016 meantime dove down 6 points to 63½, though the trader noted that the closing level was up from the day’s low around 60.

Colt Defense LLC’s 8¾% notes due 2017 were also beaten down, declining 2¼ points to 79.

And, 21st Century Oncology Inc.’s 9 7/8% notes due 2017 came in 1½ points to 83½.

That issue had been driving higher for the last few sessions on word the company had inked a recapitalization support deal with bondholders.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.