Morning Commentary: Sea convertibles continue to see heavy volume after Tuesday rally

By Abigail W. Adams

Portland, Me., Nov. 30 – The convertibles primary market remained dormant early Wednesday although sources were hopeful for some new deal activity before the week draws to a close.

There has been some hesitation in the market with equity indexes again mixed in early trading as markets await fresh comments from Federal Reserve chair Jerome Powell and the release of the Federal Reserve’s preferred inflation indicator, the Consumer Price Expenditure report, on Thursday.

The Dow Jones industrial average was down 226 points, or 0.67%, the S&P 500 index was down up 0.34%, the Nasdaq Composite index was up 0.06% and the Russell 2000 index was down 0.47% shortly before 11 a.m. ET.

There was $74 million in reported volume about one hour into the session although a single name accounted for almost one-quarter of the total reported volume in the space.

Sea Ltd.’s 0.25% convertible notes due 2026 continued to see heavy volume after a trading “frenzy” into Tuesday’s close, a source said.

The 0.25% convertible notes continued to trade on a 74-handle in heavy volume early Wednesday although they were down slightly after running up 4 points to 74.75 at Tuesday’s close.

There was heavy volume in the name at 74.75 prior to the market open with seven sellers and one buyer, a source said.

The notes were changing hands in the 74.25 to 74.75 context after the market open.

Sea’s American Depositary Shares were trading at $55.33, an increase of 1.97%, shortly before 11 a.m. ET.

© 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.