Morning Commentary: Ctrip.com jumps after earnings; tech sector active, energy at ‘indecision point’

By Rebecca Melvin

New York, March 20 – Ctrip.com International Ltd.’s convertibles jumped in active trade early Friday after the Shanghai-based internet travel site reported strong revenue for its fourth quarter and said it expects revenue to continue to rise in its first quarter.

The Ctrip 1.25% convertibles due 2018 were seen wrapped around 103.5 versus an underlying share price of $56.00 in the early going, according to a New York-based trader.

That was about 7 points higher on an outright basis and up 2 points on a swap basis, he said.

Ctrip shares were up $10.24, or 22%, to $56.29 recently.

Ctrip is one of the stronger names in the Chinese internet space around which there has been a lot of skepticism, the trader said. At this point, it is enjoying some improved credit assumptions.

Elsewhere, some technology names were trading. Twitter Inc. and Microchip Technology Inc. were mentioned as active, while the energy and health care sectors were notably quiet.

“We’re at an indecision point in energy, whether crude breaks lower to $35 or bounces back to $50,” the trader said.

The broader markets were higher including oil prices early Friday.

West Texas Intermediate crude oil for April delivery was up $1.31, or nearly 3%, at $46.84.

“Things are better to buy, I’d say. The S&P is up 20 points; that helps, bonds are rallying, oil is rallying,” the trader said.

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