Secondary extends gains; Avient at premium; Community Health plummets

By Paul A. Harris and Abigail W. Adams

Portland, Me., July 28 – The high-yield new-issue market was in a celebratory mood on Thursday following the razor-sharp execution seen Wednesday by Avient Corp., which priced a $725 million issue of 7 1/8% senior notes due August 2030 (Ba3/BB-) that saw orders five-times the size of the deal, sources said.

Meanwhile, the secondary space extended its post-Fed rally on Thursday with ETF buying continuing to lift the overall market.

While the market opened the day flat, the cash bond market added another 5/8 point by the market close with the ICE BofAML US High Yield index year-to-date returns back on a negative 9% handle.

The sustained rally in the secondary space was fueled by strong inflows with high-yield mutual and exchange-traded funds seeing their largest inflow year-to-date.

While volume had been thin, there was an uptick of activity on Thursday with new paper in the market and earnings-related volatility sparking activity in outstanding issues.

Avient’s 7 1/8% senior notes due 2030(Ba3/BB-) held onto its strong premium with the notes trading on a 102-handle.

While the overall market was strong on Thursday, CHS/Community Health Systems, Inc.’s capital structure was under pressure with its notes dropping 6 to 13 points.

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