Junk bond calendar carries forward; new KBH on par-handle; Cogent flat; Carnival sinks

By Paul A. Harris and Abigail W. Adams

Portland, Me., June 8 – No unexpected deals came into the primary high-yield space on Wednesday and no deals made it off the calendar.

Meanwhile, the secondary space continued to come in on Wednesday as the 10-year Treasury yield again pushed past the 3% threshold as analysts cut their global growth forecasts.

The cash bond market was down ¼ point with the ICE BofAML US High Yield index’s year-to-date returns again approaching negative 9%.

Recent issues dominated the tape although the deals to price during Tuesday’s session saw a lackluster reception in the secondary space.

KB Home’s 7¼% senior notes due 2030 (Ba2/BB) were changing hands with a slight premium in aftermarket activity.

While the deal was heard to be heavily oversubscribed, Cogent Communications Group, Inc.’s 7% senior notes due 2027 (B3/B) dropped below their issue price in intraday activity although they bounced off their lows to close the day largely flat.

Trading activity was thin outside of the new deals.

However, Carnival Corp.’s 10½% senior notes due 2030 (B2/B) sank further below par in active trading after rising to a 102-handle in the ETF-driven late May market surge.

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