Junk notes broadly lower as stocks, oil fall; energy sector trades off; Sprint slides

By Paul Deckelman and Paul A. Harris

New York, Jan. 20 – The high-yield market was broadly lower on Wednesday, taking its cue from falling equities and the continued slide in world crude oil prices.

The latter helped to weigh down bonds of oil and natural gas exploration and production companies such as Whiting Petroleum Corp., Chesapeake Energy Corp., Oasis Petroleum Inc., WPX Energy Inc., EP Energy Corp. and Memorial Production Partners, LP., among others.

However, the carnage was not limited to the energy space.

The single worst-performing issue among the most actively traded credits was Sprint Corp.’s 7% notes due 2020, down more than a dozen points on the day. The No. 3 U.S. wireless carrier’s other bonds across its capital structure were all also seen down multiple points in very active dealings, and its stock slid badly as well.

Other non-energy names, also from the communications sphere, posting sizable losses on the day included Frontier Communications Corp., Charter Communications, Inc. and T-Mobile USA, Inc. Steelmaker ArcelorMittal SA was another big loser.

Among the rare upsiders was hospital operator Tenet Healthcare Corp.

Primary market activity remained quiet, although GCP Applied Technologies Inc.’s planned seven-year note offering moved into the final phase of its roadshow, which is scheduled to conclude on Thursday.

Statistical measures of junk market performance turned lower across the board on Wednesday after having been mixed on Tuesday. It was their second lower session in the last three trading days.

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