Morning Commentary: Trading light as equities rebound; short-duration notes in focus

By Abigail W. Adams

Portland, Me., March 13 – Trading volume in the convertibles secondary space was light early in Friday’s session as equity markets rebounded from one of their worst days since the market crash of 1987.

There was $63 million in reported volume about one hour into the session, although few names saw concentrated trading activity.

Those that did were short-duration notes, which have been in demand over the past few weeks as volatility whipsawed markets.

ON Semiconductor Corp.’s 1% senior notes due Dec. 1, 2020 were in focus early in the session.

After closing out the previous session below par, the 1% notes were up almost 3 points outright with stock up more than 5%.

The 1% notes were changing hands just shy of 102 early in the session with more than $9 million in reported volume, according to a market source.

ON Semiconductor stock was $13.58, an increase of 5.07%, shortly before 11 a.m. ET.

The manufacturer of semiconductor components lowered its first-quarter revenue guidance last Friday due to the impact of the coronavirus outbreak.

The notes were trading around 114 last week.

NextEra Energy Partners LP’s 1.5% convertible notes due Sept. 15, 2020 also continued to see active trading.

The 1.5% convertible notes were up about 1 point outright to 98.75 early in Friday’s session, according to a market source.

The notes saw about $4 million in reported volume.

NextEra stock was $47.25, an increase of 4.81%, shortly before 11 a.m. ET.

The notes plunged almost 8 points to 97 during Thursday’s session.

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