Distressed bond market weakens; oil’s retreat pressures sector again; Caesars debt softens

By Stephanie N. Rotondo

Phoenix, Jan. 12 – With oil prices down over 5% in Monday trading, a distressed debt trader said that “so much of the focus continues to be on energy stuff.

“In general, our market got dragged down with what was going on with stocks and oil,” he continued.

The Dow Jones industrial average lost nearly 100 points during the first session of the week. In oil, West Texas Intermediate crude dropped $2.44, or 5.05%, to $45.92, while Brent crude declined $2.70, or 5.39%, to $47.41.

All that added up to pretty decent dips in oil and gas names, amid a good amount of trading.

Halcon Resources Corp.’s 9¾% notes due 2020 saw “quite a bit of volume,” a trader said, seeing the paper lose nearly 3 points to close around 74¼.

Elsewhere in the space, a trader said Linn Energy LLC’s 8 5/8% notes due 2020 were “heavily traded,” falling almost a point to 87¾.

SandRidge Energy Inc.’s 8 1/8% notes due 2022 declined 2½ points to 63½, according to the trader.

There was also weakness away from the energy space. Caesars Entertainment Corp., for instance, was a bit softer on the day as second-lien creditors attempted to push the company into an involuntary bankruptcy proceeding.

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