Convertibles trade quietly amid mixed stocks; Medicines lower with shares; Intel eyed

By Rebecca Melvin

New York, July 19 – The convertible bond market was trading quietly on Tuesday amid mostly trendless stock markets, which ended mixed, although the Dow Jones industrial average closed at another record high, its eighth straight record close.

The Dow index sold off after the Brexit vote late last month but subsequently rebounded and is now 3% higher than it was before the Brexit vote.

Convertible debt mostly followed stock moves on Tuesday, market sources said.

There were no U.S. deal launches on Tuesday. In U.S. secondary market action, traders said there were various names in trade but on light volumes.

“There were a lot of different trades across the board but nothing of note,” a New York-based trader said.

Medicines Co.’s 2.5% convertibles due 2022 traded down a bit in line with shares to 121.25 from 122 to 123 on Monday. Shares of the Parsippany, N.J.-based health care company were down 51 cents, or 1.45%, to $34.59.

The new Medicines 2.75% convertibles due 2023, of which $402 million priced in June, didn’t appear to have traded. That paper traded on Monday at 99 with the shares a little higher, the trader said.

Meanwhile, Wednesday’s earnings lineup includes Intel Corp. and Iconix Brand Group Inc., which may generate some interesting market action, the trader said.

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