Morning Commentary: Convertibles secondary trading light; Tesla in focus; Nio gains

By Abigail W. Adams

Portland, Me., May 28 – The convertibles secondary space was slow in the return from the Memorial Day holiday weekend with about $80 million on the tape shortly before 11 a.m. ET and few names seeing concentrated trading activity, according to a market source.

Tesla Inc. was again the most actively traded name of the day. The recently priced 2% convertible notes due 2024 were changing hands at 87.875 early in Tuesday’s session with stock again down, according to a market source.

Tesla stock was again volatile early Tuesday and traded as high as $195.00 early in the session.

However, stock was $189.35, a decrease of 0.67%, shortly before 11 a.m. ET.

More than $9 million of the notes were on the tape early in Tuesday’s session.

Meanwhile, Nio Inc.’s 4.5% convertible notes due 2024 were making gains early Tuesday.

After trading as low as 66 on Friday, the 4.5% notes gained 2.75 points outright. The notes traded up to 68.75 early in Tuesday’s session, a market source said.

Nio’s ADSs rose to $4.05, an increase of 4.79%, by 11 a.m. ET.

The Shanghai-based electric car manufacturer, which some sources refer to as the Tesla of China, posted better-than-expected first-quarter earnings.

Nio reported revenue of $243 million, which beat expectations for revenue of $229 million.

The adjusted net loss of $373 million was also less than the $472 million loss analysts had expected, Businessinsider.com reported.

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