Morning Commentary: Convertibles primary, secondary markets quiet; Western Digital active

By Abigail W. Adams

Portland, Me., July 28 – The convertibles primary market was again quiet early in Tuesday’s session.

While STMicroelectronics NV launched a $1.5 billion two-tranche offering of 0% convertible bonds, the deal is Regulation S and will not trade in the domestic market.

However, market players still expect to see some new deals before the week is through.

The secondary space was also quiet early Tuesday with equities launching the day in the red amid mixed earnings reports.

There was $75 million in reported volume a little over one hour into the session, a market source said.

Western Digital Corp.’s 1.5% convertible notes due 2024 topped the volume charts.

The notes were changing hands around 97 with more than $12 million in reported volume, a source said.

The hard disk drive manufacturer and data storage company’s stock was $43.36, a decrease of 0.62%, shortly before 11 a.m. ET.

While Western Digital has not yet announced its earnings report date, the earnings results of several tech companies will be announced this week.

Industry peer and former convertible issuer Intel Corp.’s stock plunged after the company reported its second-quarter earnings late last week.

While the company beat expectations in the second quarter, stock dropped 18% last Friday on weak third-quarter guidance, Business Insider reported.

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