Morning Commentary: Illumina in focus on quiet morning

By Abigail W. Adams

Portland, Me., June 27 – It was again a quiet start to the week in the convertibles secondary space on another choppy start for equity markets.

Few names were active as indexes wavered between gains and losses early in the session – with the exception of one issue.

Illumina Inc.’s 0% convertible notes due Aug. 18, 2023 (BBB) continued to see heavy volume as the notes approach their maturity.

The 0% notes were down about 0.5 point outright to trade at 95.25 early in the session.

There was $30 million on the tape with a large outright seller in the name and plenty of buyers, a source said.

The high-premium, short-duration notes were offering an attractive yield of 4.3%.

The notes were at one time deep-in-the-money and traded rich in the secondary space.

However, the notes have cheapened dramatically in the market downturn and now trade for their yield.

“A lot of money was made on these bonds,” a source said.

Outside of Illumina, few names saw concentrated trading activity.

The market appeared to be in a consolidation phase, a source said.

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