Morning Commentary: Convertibles primary remains dormant; secondary market active early

By Abigail W. Adams

Portland, Me., Nov. 5 – The convertibles primary market was again dormant on Thursday as equities continued to rally despite continued uncertainty surrounding the U.S. election.

The Dow Jones industrial average was up 622 points, or 2.24%, the S&P 500 was up 2.29% and the Nasdaq Composite was up 2.41%.

“The market’s been acting like nothing is relevant,” a source said. “It just keeps moving up.”

While there has been no new paper in the space since Tuesday, the secondary space was active with $105 million in reported volume about one hour into the session.

Novocure Ltd.’s 0% convertibles due 2025 continued to gain on an outright basis as stock edged higher alongside the overall market.

The notes were up about 0.5 point to 106.25 early in the session, a source said.

There was about $7 million in reported volume.

Novocure’s stock rose to $122.74, an increase of 0.65%, shortly before 11 a.m. ET.

SolarEdge Technologies Inc.’s 0% convertible notes due 2025 jumped outright as stock recovered from Tuesday’s post-earnings crash.

The 0% convertible notes were up almost 6 points with stock up more than 10%.

The notes were changing hands at 114.5 versus an equity price of $227.18 early in the session, a source said.

There was about $7 million of the bonds on the tape.

SolarEdge’s stock was changing hands at $228.02, an increase of 10.4%, shortly before 11 a.m. ET.

SolarEdge’s stock crashed more than 20% on Tuesday following its earnings report.

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