HY primary, secondary close books on historic quarter; cruise lines tank; Rent-A-Center falls

By Paul A. Harris and Abigail W. Adams

Portland, Me., Sept. 30 – The Friday close brought the curtain down on the most anemic third quarter in the modern history of the high-yield bond market.

The quarter concluded with just $20.5 billion of junk-rated, dollar-denominated issuance – 70% below average third quarter issuance of $67.1 billion and 15% below the second most anemic quarter in recent history.

The secondary space also closed the books on a historic Q3 that will long be remembered for its volatility and its losses with the quarter closing at the lows of the year.

Friday marked a fitting end to a whipsaw three-month period with the market strong at the open but in the red by day’s end.

Market players are bracing for an earnings season that could add further pressure with early results disappointing.

Cruise line operators saw outsized losses on Friday after Carnival Corp. reported earnings.

Carnival’s senior notes fell 4 to 7 points in heavy volume after a large earnings miss and below average bookings for the fourth quarter.

The results dragged down Royal Caribbean Cruises Ltd. with the notes issued in 2022 hitting fresh lows.

Rent-A-Center, Inc.’s 6 3/8% senior notes due 2029 (B1/B) also saw large losses after it downwardly revised its third-quarter guidance.

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