Morning Commentary: Convertibles quiet as equities slide; Tesla bonds little changed

By Rebecca Melvin

New York, May 6 – The convertibles market started off the new week on a quiet note on Monday as U.S. and global shares traded down amid renewed trade worries. Tesla Inc.’s bonds were trading more or less flat in quieter action after being the centerpiece of trade on Thursday and Friday.

Tesla’s new $1.6 billion convertible hit the market on Friday and expanded in initial action as the older Tesla paper contracted. The electric car manufacturer also priced an issue of common stock for a total capital raise of $2.35 billion.

On Monday, Tesla’s 1.25% convertible notes due 2021 were at 100.5, according to Trace data, after trading as high as 101.875 on Friday and closing that session at around 100.75.

Tesla’s 2.375% convertible notes due 2022 traded little changed at 105.5 early Monday after ending the session at about that level on Friday, having traded up to as high as 106.5 early in the session.

Tesla shares were last down $2.32, or 0.9%, at $252.72.

Atlas Air Worldwide Holdings Inc.’s 1.875% convertibles due 2024 were finding their footing in early action with trades in line with Friday’s range as shares of the Purchase, N.Y.-based outsourced aircraft and aviation services company dropped at the market open, trading down last by $1.02, or 2.2%, at $45.83.

Convertibles issuer Immunogen Inc.’s shares popped on Monday and were last up 16% at $3.33, a gain of 45 cents.

Overall, however, the market was super quiet, a New York-based sellsider said.

“Even with the move in stocks, it’s quiet,” the sellsider said.

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