Morning Commentary: Convertibles steady; Intel moves up in line with shares; Vipshop pulls back

By Rebecca Melvin

New York, Aug. 28 – U.S. convertibles were quiet early Friday as the dust settled from a volatile but light-volume week during which a correction played out in the broader markets.

Pricing for convertibles remained lower overall from where things started out the week but had recovered some and were stable, a New York-based sellsider said.

“Things are extremely quiet. I am not seeing a lot of follow through, although there are a few people bidding on bonds,” the trader said.

Intel Corp.’s convertibles were trading up in line with the underlying shares of the Santa Clara, Calif.-based chip giant. The Intel 3.25% convertible due 2039 were trading up about 3 points on an outright basis to 144.5, compared to 141.5 on Thursday.

The Intel 2.95% convertibles were last seen at 116.5. Intel shares were up 60 cents, or 2.2%, at $28.34.

Vipshop Holdings Ltd.’s convertibles pulled back a little on an outright basis along with lower shares of the Guangzhou, China-based online discount retailer.

Vipshop’s 1.5% convertibles due 2019 crossed the Trace tape last at 116.65, which was down a point or two from Thursday, but still higher by about 3 points from Wednesday’s close, traders said.

Vipshop shares were trading down and were last off 75 cents, or 3.8%, at $19.14.

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