Intel dominates trading volume; Qihoo, GT Advanced down outright, unchanged on hedge

By Rebecca Melvin

New York, July 8 – Intel Corp. accounted for a big chunk of U.S. convertibles trading on Tuesday as market players steered toward safer, longer-dated names in the midst of a two-day rally in Treasuries.

The Intel notes were seen moving in tandem with Treasuries and keeping in step on a valuation basis.

“Intel is more or less a Treasury surrogate. There are better sellers if Treasuries go lower, and better buyers if Treasuries go higher,” a New York-based trader said.

Better to buy means that the bid is stronger and the offer possibly nebulous.

There were a few other names of interest in trade, but pricing action was, for the most part, unchanged, or in line with moves in the underlying shares, market players said.

Redwood Trust Inc., which represents one of the cheaper real estate investment trusts, or REITs, in the convertibles space, changed hands amid continuing strength in REIT equities. Redwood shares ended up by a dime.

Qihoo 360 Technology Co. Ltd.’s 2.5% convertibles were trading actively but were unchanged, with shares of the China web search engine down about 5%, a second New York-based trader said.

Qihoo’s convertibles were called 113 bid, 113.5 offered versus an underlying share price of $88.00.

GT Advanced Technologies Inc.’s convertibles traded down, mostly in line with shares of the Merrimack, N.H.-based solar and LED equipment company.

Otherwise there were “dribs and drabs trading,” a New York-based trader said.

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