Morning Commentary: Convertibles trading quiet; Oasis Petroleum in focus on bankruptcy

By Abigail W. Adams

Portland, Me., Sept. 30 – Trading activity in the convertibles secondary space was light early in Wednesday’s session with $62 million in reported volume about one hour into the session.

While the majority of activity centered on end-of-month rebalancing of portfolios, Oasis Petroleum Inc.’s 2.625% convertible notes due 2023 were in focus and making gains following the company’s bankruptcy filing.

The 2.625% convertible notes were changing hands at 23 early in Wednesday’s session, according to a market source.

There was more than $10 million in reported volume on the tape.

The long-busted convertible notes were changing hands at 20 in early September. They were in the single digits in March, April and May, according to Trace data.

The oil and gas company filed for Chapter 11 bankruptcy protection on Thursday after reaching a restructuring agreement with lenders, which included certain holders of the 2.625% notes.

The bankruptcy filing was widely anticipated, particularly after the company missed the coupon payment on the 2.625% notes in mid-September.

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