Commodities lead distressed bonds higher; iron names firm; oil and gas remains strong

By Stephanie N. Rotondo

Seattle, March 7 – The distressed debt market’s commodity-led rally “continued kind of across the board,” a trader said Monday.

Such the case for iron ore producers on Monday, as the price of the commodity jumped nearly 19% on the day.

Investors in FMG Resources’ bonds took advantage of the gain, pushing the company’s debt up 4 to 6 points on the day.

One trader saw the 9¾% notes due 2022 pushing up 4 points to 104. He deemed the 8¼% notes due 2019 and the 6 7/8% notes due 2022 up 5 to 6 points, at “around 99” and 83, respectively.

Another market source pegged the 6 7/8% notes at 83 bid, up 6½ points on the day.

Cliffs Natural Resources Inc., another iron producer, also benefitted, with a trader calling the 8¼% notes due 2020 up 4 points at 82.

The 3.95% notes due 2018 traded “as high as 40,” up 5 points, the trader said.

With iron’s gain, steel names were also on the rise.

A trader said AK Steel Holding Corp.’s 7 5/8% notes due 2021 inched up a point to 56¼. Elsewhere in the metal mining arena, First Quantum Minerals Ltd.’s 6¾% notes due 2020 were seen adding “another 3 points” to close at 66½.

Freeport-McMoRan Inc. debt, however, was bucking the upward trend.

A trader said the 3 7/8% notes due 2023 fell almost 3 points to 72½, as the 3.55% notes due 2022 dipped a deuce to 74¼. The 4.55% notes due 2024 slipped nearly a point to 73¼.

© 2015 Prospect News.
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