Morning Commentary: Convertibles quiet as equities struggle; Norwegian Cruise sinks

By Abigail W. Adams

Portland, Me., Feb. 14 – It was a quiet morning in the convertibles secondary space as equities struggled to find direction amid heightened geopolitical risks and the specter of rising rates.

Indexes were mixed shortly before 11 a.m. ET with the Dow Jones industrial average down 342 points, or 0.99%, the S&P 500 index down 0.61% and the Russell 2000 index down 0.46% after flirting with positive territory and the Nasdaq Composite up 0.33% after dipping into negative territory.

There was $61 million in reported volume about one hour into the session with few names seeing concentrated trading activity.

NCL Corp. Ltd.’s new 2.5% exchangeable notes due 2027 for Norwegian Cruise Line Holdings Ltd.’s stock continued to sink in heavy market conditions.

The notes were down to a 97-handle and were changing hands at 97.375 versus a stock price of $21.70 early in the session.

While the notes were able to maintain a nominal dollar-neutral expansion on Friday, they contracted about 0.5 point on a dollar-neutral basis early Monday.

Norwegian Cruise’s stock was flat at $21.44 shortly before 11 a.m. ET.

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