Morning Commentary: TotalEnergies soon-to-mature convertible notes in focus

By Abigail W. Adams

Portland, Me., Sept. 28 – There was an uptick of activity in the convertible secondary space on Wednesday with equity markets firmly in the green after wavering early in the session.

Treasuries also stabilized with yields coming in as the market digested the Bank of England’s announced intervention to restore order to the market after the passage of tax cuts sent England’s currency and bonds reeling.

The Dow Jones industrial average was up 280 points or 0.96%, the S&P 500 index was up 0.90%, the Nasdaq Composite index was up 0.63% and the Russell 2000 index was up 1.84% shortly before 11 a.m. ET.

There was $92 million in reported volume about one hour into the session with a wide berth to the names in play.

TotalEnergies SE’s 0.5% convertible notes due Dec. 2, 2022 were in focus in secondary market activity with the maturity of the notes fast approaching.

The 0.5% convertible notes were largely unchanged in heavy volume with the notes wrapped around 99.375, according to a market source.

The notes were carrying a yield of 4.177%.

There was $11 million in reported volume with four large trades on the tape.

The notes were trading outright for their yield, a source said.

TotalEnergies, formerly Total SA, announcement of a special dividend for 2022 was in the news on Wednesday. A special dividend of 96 cents is planned and the company said it will allocate a significant portion of its cash flow to shareholders.

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