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Convertibles trade quietly in muted month-end trade; Micron extends outright gains
By Rebecca Melvin
New York, Sept. 29 – Convertibles traded quietly on Friday with most issues moving flat compared to moves in their underlying shares or within previous levels, with no notable month-end rebalancing, a New York-based trader said.
Micron Technology Inc.’s equity sensitive 3% convertibles due 2043 moved up to about 138 on Friday, from 134 on Thursday, which compared to a $1.37, or 3.6%, jump in the underlying shares of the Boise, Idaho-based memory chip maker.
Shares have been gaining since the company reported better-than-expected earnings and boosted its outlook on Wednesday. Shares closed Friday at $39.33.
Microchip Technology Inc.’s 1.625% convertibles due 2025, or the A tranche, was trading actively at about 120.875 versus an underlying share price of $89.00.
Outright buyers and sellers were attributed for the Microchip trading action rather than any news specific to the Chandler, Ariz.-based semiconductor company, a trader said.
“Things are very quiet, the trader said. “We are in between earnings cycles right now and the market is pretty rich, so there isn’t a lot of motivation to trade.”
There was $775 million of new paper priced this past week in three deals.
IAC/InterActiveCorp.’s $450 million of 0.875% exchangeable senior notes due 2022, which priced ahead of Wednesday’s market open, was also pretty quiet.
“You’re getting more outright-placed deals, so they are pretty sticky,” a trader said, referring to a lack of follow on trading action in new deals like IAC/InterActive.
Mentioned in this article:
IAC/InterActiveCorp. Nasdaq: IAC
Micron Technology Inc. NYSE: MU
Micochip Technology Inc. Nasdaq: MCHP
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