Convertibles better bid after U.S. employment data; Cypress Semiconductor adds on swap

By Rebecca Melvin

New York, July 8 – U.S. convertibles were better bid on Friday after better-than-expected U.S. jobs data pushed both equities and Treasuries higher simultaneously.

“On a relatively, light volume day, things were better to buy, post the jobs numbers,” a New York-based trader said of the convertibles market.

“More balanced convertibles are definitely better. But it’s been mostly small trades,” the trader said, characterizing the day as a “generic, slow-market melt up.”

Cypress Semiconductor Corp.’s 4.5% convertibles due 2022, which priced last month, traded at 107.375, according to Trace data, and were better by about 0.5 point on swap against Cypress shares, which were up 43 cents, or 4%, at $10.53, the trader said.

There was buzz in the name after “an article in the Financial Times, which wasn’t particularly helpful,” sparked interest, the trader said of Cypress.

FireEye Inc.’s two sister convertibles, each $460 million in size, traded on Friday. The FireEye 1.625%, series B, convertibles due 2035 traded at 90.25, which was up 1.5 points on an outright basis on the day, according to Trace data, and the FireEye 1%, series A, convertibles due 2035 traded at 91.75.

Shares of the Milpitas, Calif.-based network security company were up 20 cents, or 1.3%, at $16.20 in the early going. But the FireEye shares extended gains during the session, closing up 42 cents, or 2.6%, to $16.42.

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