Upcoming holiday results in little volatility; PDVSA, ATP Oil stay at top of distressed names

By Stephanie N. Rotondo

Phoenix, Aug. 28 - There was "similar volume" in the distressed debt universe Tuesday - that is, not a lot.

And, for the most part the market was "trading sideways," according to a trader.

"It's getting slower as we head in [to the weekend]," the trader said.

The top distressed names continued to be Petroleos de Venezuela SA and ATP Oil & Gas Corp. PDVSA debt was mixed as firefighters sought to curtail flames at the state-owned oil company's largest refinery, while ATP paper was marginally higher on the day, on no news.

PDVSA, ATP stay active

PDVSA bonds were mixed Tuesday, as the company continued to fight fires at its largest refinery.

A trader said the 9¾% notes due 2035 were down "almost 3 points" at 76, while the 8½% notes due 2017 inched up a touch to 891/2.

The 9% notes due 2021 were also modestly firmer at 83 7/8.

A fire broke out at the Amuay refinery on Saturday. On Tuesday, the country's oil minister said the blaze had been contained, but flames and smoke could still be seen.

A gas explosion in the storage tanks caused the fire. At least 48 people have died thus far.

Meanwhile, ATP Oil & Gas' 11 7 /8% notes due 2015 "rebounded a little bit," even as Tropical Storm Isaac was making its way to hurricane status through the Gulf of Mexico, where the bankrupt Houston-based offshore oil exploration company has several drill sites.

A trader pegged the notes at 26 7/8.

Another trader said the debt was "a little better" at 26½ bid, 27 offered.

ATP's Nasdaq-listed stock will be delisted on Wednesday.

Broad market mixed

Among other distressed issues, a trader said Best Buy Co. Inc.'s 5½% notes due 2021 were unchanged, trading around 90.

West China Cement Ltd.'s 7½% notes due 2016 traded in the first time in a while, the trader commented. He saw the issue at 853/4, though he was not sure how that compared to previous trades.

Another trader said NII Holdings Inc.'s 7 5/8% notes due 2021 were higher around 77.

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