Tesla Motors in line to slightly lower; Solayzme jumps; Alcatel-Lucent up on Nokia talk

By Rebecca Melvin

New York, April 14 – U.S. convertibles traded quietly on Tuesday with little by way of catalysts to stimulate flow amid mixed to weaker equities. News of a large potential merger in the European market stimulated euro-denominated convertibles, however.

Tesla Motors Inc.’s convertibles were flat to slightly lower on a dollar-neutral basis, with the Tesla 1.25% convertible due 2021 seen crossing the Trace tape at 89, which was down about 0.5 point on an absolute basis.

Tesla was “in line to a tick weaker,” the trader said, adding that it was only about 0.125 point weaker. On an outright basis, the 1.25% bond was lower by 0.5 point.

Tesla shares ended down 1.1% after Morgan Stanley lowered its estimate on Tesla earnings. But the bank kept its “overweight” rating and $280 price target on shares.

Solazyme Inc.’s convertibles jumped a handful of points as shares surged after news that the San Francisco-based plant oils producer forged an agreement with Flotek Industries Inc. to commercialize and market an advanced oilfield drilling fluid additive.

Ciena Corp.’s 3.75% convertibles traded up in concert with the news of advanced talks of a potential linkup of two large networking company rivals, Nokia Corp. and Alcatel-Lucent SA.

The Ciena bond traded up to about 130, a New York-based trader said. That was up about 5 points as shares of the Hanover, Md.-based telecom equipment maker jumped 7% to $21.38.

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