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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Stoctrash who wrote (5271)	12/13/2001 3:05:33 PM
From: John Pitera	Respond to of 33421

Good point, I worked with a guy who's Dad runs Portland House Ltd. Portland House bought several hundred million dollars of Wheeling Pittsburgh steel bonds back in the early '80's. They got them for like 5 cents on the dollar. The company over several years came back out of bankruptcy and those bonds were an impressive buy. EPG was buying back some notes yesterday at 81 cents on the dollar and was ending up with a negative interest cost on that borrowing. Look how EPG 10 year paper came in 100 basis points relative to treasuries yesterday. Some corporate color: Hearing that the Pipeline sector was where all the action was yesterday. Prior to the announcement from El Paso that they would make some balance sheet adjustments, spreads were 50 bp wider. However, once this news hit the tape they would rally, and finish 100 bp tighter on the session. For reference, 10-year EPG opened at 370 bp over Treasuries, and closed at 275 bp/265 bp over Treasuries. As for other sectors, we hear that bid lists dominated trading, which would lead to the spread widening we noted in the Corporate Recap.