Morning Commentary: Markets soar following Powell comments; Intel, Chesapeake Energy in focus

By Abigail W. Adams

Portland, Me., July 10 – The convertibles secondary space saw a moderate increase in activity on Wednesday with equity markets strong following comments from Federal Reserve chairman Jerome Powell, which signaled support for a July rate cut.

There was $72 million on the tape about one hour into Wednesday’s session.

Intel Corp.’s 3.25% convertible notes due 2039 were among the most actively traded issues in the space.

The notes were changing hands at 234 with about $5 million in reported volume about one hour into Wednesday’s session, according to a market source.

At more than double par, the 3.25% notes were an equity trade, the source said.

Intel stock was changing hands at $48.23, an increase of 1.01%, shortly before 11 a.m. ET.

With the oil patch strong on Wednesday, Chesapeake Energy Corp.’s 5.5% convertible notes due 2026 also saw a fresh round of trading activity.

The 5.5% notes were changing hands at 76 with more than $6 million in reported volume early in Wednesday’s session.

The notes were trading for their yield which was around 10.25%, a market source said.

The energy sector was lifted on Wednesday alongside the overall market as crude oil futures jumped on the heels of a report that reflected a larger than anticipated drop in U.S. inventory.

The barrel price of WTI crude oil for August delivery jumped to $59.60, an increase of $1.77 or 3.06%, shortly before 11 a.m. ET.

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