Morning Commentary: Trading light; old Yahoo! convertibles active as maturity nears

By Abigail W. Adams

Portland, Me., Nov. 21 – Trading volume was light in the convertibles secondary space with not much activity expected during the pre-Thanksgiving session.

There was about $58 million on the tape a little more than one hour into Wednesday’s session. However, few names saw more than $4 million in trades.

Altaba Inc.’s 0% convertible notes due Dec. 1, 2018 were among the most actively traded issues in the secondary space with $4 million on the tape.

The notes were seen changing hands at 114.75, which was essentially parity, a market source said.

The outstanding amount of the notes has slowly diminished with holders most likely converting the notes out, or the company buying back the bonds in the run up to their maturity.

The notes were initially issued by Yahoo! Inc. in 2013, which became Altaba after the sale of its internet business to Verizon in 2017.

Illumina Inc.’s 0% convertible notes due 2023 were also active early in the session as stock rebounded from its lows.

The notes traded at 125.125 on an outright basis with $4 million on the tape early in the session.

Illumina stock traded up to $308.60, an increase of 2.5% shortly before 11 a.m. ET.

While equities saw a slight rebound early Wednesday, sources were pessimistic about the upswing’s staying power.

The Dow Jones industrial average was up 132 points early in the session. However, the volume was light, a market source noted.

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