Convertibles trade quietly ahead of Labor Day weekend; Salesforce ‘comes in’ slightly

By Rebecca Melvin

New York, Sept. 1 – U.S. convertibles were trading quietly on Thursday on the first day of September and ahead of the Labor Day holiday weekend. Financial markets will be closed on Monday.

In addition market players were waiting on the U.S. payrolls report for August slated to be released early Friday.

“Basically, there’s nothing going on,” a New York-based trader said. But, he allowed, there was a little activity in some issues related to news that was also moving their underlying shares.

Salesforce.com Inc.’s 0.25% convertibles due 2018 were down outright and contracted slightly on a dollar-neutral, or swap, basis along with lower shares after the cloud software company reported a disappointing outlook amid a rise in revenue.

For its second-quarter, Salesforce swung to a profit on a 25% gain in revenue, but it gave a disappointing outlook for the current quarter, saying there was some softness in its U.S. markets.

The Salesforce 0.25% convertibles due 2018 traded at 124.25 against shares that dropped 6.5% to 7%, the trader said. On Wednesday, the Salesforce convertibles traded at 128.5 to 129.

The Salesforce shares recovered some ground from lower early trades on Thursday to close down only $3.51, or 4.4%, to $75.91.

In addition, there was still trading in Interactive Intelligence Group Inc.’s convertibles and in Liberty Interactive LLC’s debentures exchangeable for Charter Communications Inc., which moved up in active trade on Wednesday.

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