J.C. Penney denies credit woes, shares rebound

• Some small manufacturers can%27t get credit on shipments to J.C. Penney%2C report says
• Retailer has been in turmoil since former CEO dropped regular sales
• Penney says all of its key vendors are continuing shipments

J.C. Penney shares rebounded but ended 0.1% lower to $14.58 Thursday after the nationwide retailer denied speculation that its key vendors are stopping merchandise shipments because of credit problems.

The stock of the struggling department store chain tanked 10% Wednesday after a New York Post report said commercial lender CIT had stopped supporting deliveries from smaller manufacturers to J.C. Penney.

Insiders speculated that CIT got skittish after looking at Penney's financials, which have been deteriorating as the department store scrambles to recover from a botched turnaround bid under former CEO Ron Johnson.

"We do not comment on specific customers," CIT spokesman Matt Klein said in an emailed response.

J. C. Penney said the Post story was untrue, adding that the company "continues to have the support of all of its key vendors who have maintained their shipments."

Penney expects to close the quarter with about $1.5 billion in cash on its balance sheet.

Contributing: Associated Press