Morning Commentary: RingCentral convertibles active early; Russia-based Yandex eyed

By Abigail W. Adams

Portland, Me., Feb. 22 – It was a quiet return from the long weekend in the convertibles secondary space with equities wavering between gains and losses as markets follow the developing situation in the Ukraine.

The Dow Jones industrial average was down 271 points, or 0.80%, the S&P 500 index was down 0.43%, and the Nasdaq Composite was down 0.44% shortly before 11 a.m. ET.

However, the Russell 2000 index was in the green by 1 point or 0.05% shortly before 11 a.m. ET.

There was $48 million in reported volume about one hour into the session with few names seeing concentrated trading activity.

RingCentral Inc.’s 0% convertible notes due 2025 were on the rise in active trading with stock in positive territory following its settlement with Zoom Video Communications Inc.

The 0% convertible notes rose about 1 point outright with stock up more than 2% early in the session.

The 0% convertible notes were changing hands at 84.125 versus a stock price of $146.66, according to a market source.

There was $5 million in reported volume.

While a Regulation S offering, Moscow-based internet company Yandex NV’s 0.75% convertible notes due 2025 continued their downward spiral.

The notes were changing hands at 88 versus an equity price of $37.47 early in Tuesday’s session.

Prior to the escalation of tensions between the United States and Russia over the Ukraine, the notes were trading on a 106-handle, a source said.

The notes sank to 97 on Feb. 15 as tensions escalated.

Yandex’s American Depositary Shares were changing hands at $42.03, a decrease of 6.08%, shortly before 11 a.m. ET.

Investors continue to closely monitor the situation in the Ukraine as Russian troops enter into eastern regions controlled by separatist forces.

Western nations have already imposed a barrage of sanctions against Russia, including canceling a natural gas pipeline.

The White House has also promised to inflict sanctions and prohibited new investment, trade or financing in the eastern Ukrainian regions occupied by Russia.

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