Convertibles flattish in quiet trade; Twitter trades a little weaker; Brocade edges lower

By Rebecca Melvin

New York, July 13 – U.S. convertibles were mostly quiet and flat on Monday despite higher equities, which were cheered by news of a Greek bailout deal that promises to provide additional aid and keep the debt-laden country in the euro zone in exchange for austerity measures.

The Greek deal is “relevant” for the convertibles market but is not driving daily trades, a New York-based trader said.

A second New York-based trader said that the convertibles market was “flattish” and “directionless.”

Technology names looked to be something of a focus for Monday’s session though.

Twitter Inc.’s dual convertible bonds were seen a little lower with bonds in general. Those bonds were quoted at 89.5 versus an underlying share price of $35.80.

A New York-based trader said both bonds were at the same level, and he saw them a little lower against shares that were up on the day, but he wasn’t trading them.

“It’s very quiet; people are on vacation,” he said.

Brocade Communications Systems Inc. was under pressure Monday after shares were downgraded by two banks. RBC Capital Markets downgraded shares of the San Jose, Calif.-based storage area networking company to “sector perform” from “outperform.”

The convertibles saw outright sellers and were lower by a bit more than 0.5 point on an outright basis and flat to down 0.25 point on swap.

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