Junk: CHS/Community Health active post-earnings; Service Properties, Emergent Bio jump

By Paul A. Harris and Abigail W. Adams

Portland, Me., Feb. 16 – The junk bond secondary space was heavy on Thursday with the downtrend in the market accelerating after the release of the Producer Price Index report, which came in hotter than expected.

The report continued to throw cold water on market optimism about a pause and even decrease in rates sparked by Federal Reserve chair Jerome Powell’s Feb. 2 press conference.

The cash bond market was down another 3/8 point on Thursday with ETF selling dragging down the broader market.

With the primary market pipeline pausing, earnings and topical news were the main drivers of activity in the space.

CHS/Community Health Systems, Inc.’s senior notes were mixed in heavy volume following the health care provider’s earnings announcement.

While the broader market was heavy, topical news sparked outsized gains in several outstanding issues.

Emergent BioSolutions Inc.’s 3 7/8% guaranteed senior notes due 2028 (Caa1/B) jumped almost 10 points with its Narcan spray set for over-the-counter approval.

Service Properties Trust’s capital structure rose 2 to 6 points after the real estate investment trust amended lease terms.

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