Morning Commentary: Zendesk convertible notes active on quiet morning

By Abigail W. Adams

Portland, Me., April 20 – It was another quiet start to the day in the convertibles secondary space with few names on the tape on a mixed day for equity markets.

While the Dow Jones industrial average, S&P 500 index and Russell 2000 index were in positive territory early in the session, the Nasdaq Composite underperformed.

The Dow was up 298 points, or 0.85%, the S&P 500 index was up 0.33% and the Russell 2000 index was up 0.86% shortly before 11 a.m. ET.

However, the Nasdaq Composite index was down 0.53% with growth stocks under pressure following Netflix Inc.’s earnings.

Netflix’s stock was getting hammered followed its earnings miss and first reported decrease in subscribers in a decade.

Stock was down 35% early in the session with Netflix’s results dragging down other growth stocks.

However, the activity in equity markets did not translate into trading activity in the secondary space, which remained quiet.

In a carry-over from the previous session, Zendesk Inc.’s 0.625% convertibles due 2025 remained active early in the session.

The notes were wrapped around 131 early in the session as stock wavered between gains and losses.

Zendesk’s stock was changing hands at $129.48, an increase of 0.28%, shortly before 11 a.m. ET.

Zendesk was also in focus during Tuesday’s session following news the company had hired an adviser to help it explore a potential sale.

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