Morning Commentary: Marriott Vacations convertible notes in focus early, hit new high

By Abigail W. Adams

Portland, Me., Dec. 13 – It was a strong start to the day in the convertibles secondary space as risk assets surged on the back of November’s Consumer Price Index report, which came in below forecasts.

Equity indexes catapulted higher at the open although they gave back some of their early gains as the session progressed.

The Dow Jones industrial average was up 225 points, or 0.67%, the S&P 500 index was up 1.43%, the Nasdaq Composite index was up 2.08% and the Russell 2000 index was up 1.38% shortly before 11 a.m. ET.

There was an uptick of trading activity early Tuesday with a wide range to the names in play, a source said.

Marriott Vacations Worldwide Corp.’s recently priced 3.25% convertible notes due 2027 were in focus with the notes jumping to their highest outright level since breaking for trade.

The 3.25% notes jumped 2 points outright as stock spiked early in the session, a source said.

The notes were changing hands at 102.75 versus a stock price of $144.34 about one hour into the session.

However, the notes came in with stock to trade at 101.5 shortly before 11 a.m. ET.

They expanded on the move up.

Marriott’s stock was trading at $142.08, an increase of 0.74%, shortly before 11 a.m. ET.

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