Primary drought resumes; new Scotts jumps; Chemours rebounds on buyout buzz; funds gain $735 million

By Paul Deckelman and Paul A. Harris

New York, Oct. 8 – A day after the unexpected pricing of its first new deal in nearly two weeks, the high-yield primary market reverted to its recently quiet status on Thursday, with syndicate sources reporting that no new issues had either priced or had even been announced.

Wednesday’s upsized and quickly-shopped offering of eight-year notes from lawn care products manufacturer Scotts Miracle-Gro Co. meantime was seen by traders firming smartly on heavy volume when it hit the aftermarket.

Thursday’s overall secondary market had a positive tone, traders said, although it was somewhat less robust than the last several solidly positive sessions have been. Risk assets like junk bonds and equities were helped by the release of minutes from the Federal Reserve’s recent meeting showing a for-now dovish tone toward possible rate hikes.

Chemical maker Chemours Co. – which was rocked on Wednesday by bad news on the legal front – more than made up for it on Thursday, rising on news reports speculating that private equity firm Apollo Management may be interested in possibly doing a buyout of Chemours.

Another numerical indicator – flows of investor cash into or out of high-yield mutual funds and exchange-traded funds, which are considered a reliable barometer of overall junk market liquidity trends – was also on the upside on Thursday, showing a net inflow of $735 million, in contrast to the more than $2 billion outflow which had been reported last week.

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