Morning Commentary: New issue pipeline quiets down; Yahoo!, DISH convertibles give up some gains

By Stephanie N. Rotondo

Seattle, June 12 – With no new issues hitting the tape early Monday, convertible bond market players were refocusing on names like Yahoo! Inc. and DISH Network Corp.

Yahoo!’s 0% convertibles notes due 2018 had started to gain ground on Thursday after e-commerce company Alibaba – in which Yahoo! has a 15% stake – gave impressive guidance at its annual investor day.

But come Monday, a trader said the convertibles were “a little lower.”

Another market source placed the issue in a 110 to 110.5 range, down from previous levels around 112.75.

The stock (Nasdaq: YHOO) was also giving up some gains, falling 7 cents in early trading to $53.95.

As for DISH paper, that was also coming in following a run-up on Friday. Friday’s gains were attributed to reports that the satellite television provider might be considering expanding its recently announced partnership with Amazon – including a potential takeover by the online retailer.

The 3.375% convertible notes due 2026 were seen at 123.25 bid, 124.25 offered, compared to Friday trades around 125. The 2.375% convertible notes due 2024 were meantime pegged in a 106.25 to 106.75 context, down from 107.5.

The underlying shares (Nasdaq: DISH) remained firm, however, adding a dime by mid-morning to trade at $65.12.

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