Morning Commentary: Cemex convertible notes gain ground; trading muted as holiday week begins

By Stephanie N. Rotondo

Seattle, March 21 – Cemex SAB de CV’s 3.75% convertible notes due 2018 were “trading a lot” early Monday, according to a trader.

He said the notes have “moved up nicely with the stock,” placing the issue at 103 at mid-morning. That was up from opening levels in a 101.75 to 102 context, he said.

As for the equity (NYSE: CX), that was up 24 cents, or 3.41%, to $7.14.

“So that’s a big move,” the trader said.

Last week, the Mexico-based cement and aggregate producer held an investor day, in which management said the plan was to reduce debt by $2 billion by 2017. For the previous two years, the company had reduced its debt burden by just over $2 billion, including a recent refinancing of high-yield notes.

Cemex also said last week that it had extended its $3.8 billion credit facility through 2020, as well as lowered its interest rate.

“It was bullish,” a trader said of the news.

But away from Cemex, liquidity was thin. A trader blamed the thin trading on the fact that it was a shortened holiday week.

“And it’s only going to go down,” he said of trading volume.

© 2015 Prospect News.
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