Morning Commentary: Convertibles start out quietly; Steel Dynamics active ahead of maturity

By Rebecca Melvin

New York, June 9 – U.S. convertibles were quiet to start out the new week Monday, with only about $50 million of convertibles having changed hands by late morning, according to Trace volume. The low volume made it difficult to discern themes, a New York-based trader said.

Steel Dynamics Inc.’s 5.125% convertibles, which mature in six days, were trading actively at about parity, the trader said. Shares of the Fort Wayne, Ind.-based steel company were down about 1.3%.

Endeavour International Corp.’s 5.5% convertibles due 2016 were said to be quiet despite another sharp drop in the underlying shares of the Houston-based oil and gas company in the early going on Monday. The latest stock slide has been sparked by regulatory filings concerning its new stock incentive plan.

Also among distressed names, Atlanticus Holdings Corp.’s 5.875% convertibles due 2035 were pulled into trade amid a 6% drop in the underlying shares of the Atlanta-based financial services provider. The convertibles changed hands at 41, according to Trace data, which was within the previous trading range.

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