Morning Commentary: Evergy, Duke Energy convertible notes active in early trading

By Abigail W. Adams

Portland, Me., Jan. 22 – The convertibles primary market was quiet early Monday, but with one deal on the calendar and equity indexes shooting to new heights, an active week of new issuance is anticipated.

Meanwhile, the secondary space saw a quiet start to the day with activity again concentrated in investment-grade issues.

Equity indexes saw a strong open on Monday after the S&P 500 index closed the previous week at an all-time high.

The Dow Jones industrial average was up 178 points, or 0.47%, the S&P 500 index was up 0.21%, the Nasdaq Composite index was up 0.19% and the Russell 2000 index was up 1.75% shortly before 11 a.m. ET.

There was $90 million in reported volume about one hour into the session with Evergy Inc.’s 4.5% convertible notes due 2027 (Baa2/BBB) and Duke Energy Corp.’s 4.125% convertible notes due 2026 (Baa2/BBB) accounting for one-third of the total activity in the space.

The notes were little changed as Treasury yields fell alongside the strength in equities.

Evergy’s 4.5% convertible notes due 2027 were changing hands at 101.25 versus a stock price of $50.67 early in the session, according to a market source.

There was $20 million in reported volume.

Evergy’s stock was trading at $50.11, a decrease of 0.67%, shortly before 11 a.m. ET.

Duke Energy’s 4.125% convertible notes due 2026 were trading at 99.75 versus a stock price of $96.

There was $10 million in reported volume.

Duke Energy’s stock was trading at $95.57, up 0.01%.

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