Intel, Priceline, Liberty/Charter paper muted as equities waver; markets eye Yellen speech

By Rebecca Melvin

New York, Aug. 25 – Convertibles continued to trade quietly on Thursday as the dog days of August wore on, with a week to go before Sept. 1. More vigorous market activity is expected to resume with the unofficial end of summer, which is the week after next following the U.S. Labor Day holiday.

Also contributing to Thursday’s quiet tone was a pause in the broader markets ahead of Federal Reserve chairman Janet Yellen’s speech slated for Friday at the conclusion of the economic summit in Jackson Hole, Wyo., that has been underway this week.

Yellen is unlikely to provide a strong signal regarding whether an interest rate hike is coming next month or not. But if she does indicate that the Sept. 20-21 meeting could bring a rate increase, the markets could be rattled. It is more likely that given continuing low inflation and mixed economic data, policy makers will put off a potential rate increase for its December meeting.

On Thursday, there was muted trading of Intel Corp., Priceline Group Inc. and Liberty Interactive LLC’s debentures exchangeable into shares of Charter Communications Inc., as the underlying shares of those issues traded fractionally higher, a market source said.

The Liberty debenture is seeing some activity as “it takes a little time for people who weren’t involved to get their position where they want them to be,” a New York-based trader said.

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