Trading levels for Kmart's bank debt fluctuated briefly last week, falling a couple of points on the fear that Martha Stewart would be implicated for insider trading on ImClone Systems. One dealer said more than $20 million changed hands by Tuesday, with the 364-day facility moving in the 73-74 range and the three-year facility moving in the 67-68 range. By Wednesday, levels had recovered and the name was said to be quiet. Calls to the company's spokesman were not returned by press time.
Kmart also announced its first quarter financial results this week, posting a net loss of $1.45 billion. Net sales also decreased 8.4% to $7.64 billion. One trader noted that there was a lot of noise surrounding those numbers, which would take analysts some time to pick through. But another maintained that the losses were expected and that the company's connection to Stewart through her Kmart line of products was the cause of the temporary dip.