Morgan Stanley is bearish on Chemical giant Connos, positioning themselves in the bond market for short selling using the energy crisis.

Morgan Stanley's credit trading department is pushing investors a short-selling strategy against the bonds issued by the global titanium dioxide manufacturer, Connors Global. The German company has been struggling before, and the soaring energy costs resulting from the Iran war have made its situation even worse. According to sources, the trading desk has been recommending to investors since last month to short sell the 4.26 billion euro bonds due in March 2029 issued by the company. Sources said that even though bond prices have plummeted, traders have reiterated this view recently. Even before the turmoil in the Middle East drove up energy prices, companies in the chemical industry have been struggling with weak demand and high input costs, as the industry relies heavily on energy. This has made chemical companies the prime targets for short sellers.