Medicines expands on swap on positive drug data; energy names hesitate on oil’s reversal

By Rebecca Melvin

New York, Aug. 31 – U.S. convertibles players mostly tidied up their portfolios on the last day of August on Monday. A sharp reversal upward in oil prices was largely ignored, but there was action in the Medicines Co., which jumped outright and expanded on swap after news of a positive early study for the Parsippany, N.J.-based health care company’s cholesterol drug.

The bulk of last week’s wild market swings in the financial markets didn’t end up amounting to much in the convertibles space, and the three-day rally in crude oil prices wasn’t yet matched by convertibles energy names, a New York-based trader said.

“No names seem to have rebounded yet,” the trader said of the energy sector, although Chesapeake Energy Corp. was a little firmer, he added. And bellwether Whiting Petroleum Corp.’s 1.25% convertibles were seen higher at 85 from about 82 previously.

A second New York-based trader said that most convertibles players were marking their books and not focused on energy names on Monday.

“It was a tough month,” the trader said.

But most of the pain was felt in only a few beaten down names including Ctrip.com International Ltd. and SunEdison Inc.

SunEdison, a serial convertibles issuer that priced new paper in the middle of the month, saw those new preferred shares slide into the upper 70s from par in less than two weeks.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.