Distressed bonds bounce back as stocks jump; Cemex big winner; Caesars debt trends with market

By Stephanie N. Rotondo

Phoenix, June 6 - A stock market gain of nearly 300 points on Wednesday was given credit for the healthy tone of the distressed debt market.

"The market bounced back today," one trader said.

"A lot of stuff bounced off of their lows, given what the equities were doing," another trader said.

At a third desk, a trader remarked, "Stocks were cranking; they were up big. A lot of this [distressed] stuff was similarly up."

In fact many credits - some of which were hit hard in the previous week - were up anywhere from 1 to 3 points on the day, even without credit-specific, or even sector-specific, news to drive it.

Cemex SAB de CV was one of the day's bigger gainers, as the cement maker's debt climbed up as much as 3 points on the day.

Caesars Entertainment Corp. was also posting decent-sized gains, according to traders.

Other improved bonds included Momentive Performance Chemicals Inc. and Clear Channel Communications Inc.

Cemex bonds improve

A trader saw Cemex's bonds jumping 2 to 3 points in Wednesday trading, with no news to act as catalyst.

Both the 9 7/8% notes due 2019 and the 9 ¼% notes due 2020 were up 3 points, at 84½ and 801/2, respectively.

The 9½% notes due 2016 were meantime up a deuce at 921/2.

Cemex is a Mexico-based cement and aggregate manufacturer.

Caesars' debt climbs up

Las Vegas-based Caesars Entertainment saw its debt winning during the midweek session as the paper followed the general positive trend of the market.

A trader called both the 12¼% notes due 2018 and the 10% notes due 2018 up 2½ points, at 78½ and 681/2, respectively.

A second market source pegged the 10% notes at 67½ bid, up 1½ points.

Momentive, Clear Channel rise

Momentive Specialty Chemical's 9% notes due 2021 were likewise benefiting from the firm tone of the broader markets.

A trader placed the issue at 731/2, up 1½ points from the previous session.

Another trader quoted the notes at 73 bid, 74 offered, compared to levels around 71 on Tuesday.

Meanwhile, Clear Channel Communications' 10¾% and 11% notes due 2016 finished the day about 1½ points higher, according to a trader.

He placed the 10¾% notes at 63½ and the 11% notes at 611/2.

Market holds strong tone

Most other names in distressed land managed to post gains as well.

A trader saw Travelport LLC's 11 7/8% notes due 2016 putting on 3 points to end around 373/4.

The trader also deemed Bon-Ton Stores Inc.'s 10¼% notes due 2014 "up a couple points" at 76.

Another trader said ATP Oil & Gas Corp.'s 11 7/8% notes due 2015 were "moving up," closing with a "57 handle."

A third trader placed AMR Corp.'s 6¼% convertible notes due 2014 at "56-ish," also up from the previous day.

And, Eastman Kodak Co.'s 7¼% notes due 2013 were seen around 13, while the second-lien issues traded as high as 64, versus 62½ bid, 63 offered the day before.

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