Morning Commentary: Uber Technologies convertible notes active on quiet morning

By Abigail W. Adams

Portland, Me., Nov. 27 – The convertibles primary market was dormant early Monday but is not expected to remain so for long with an end-of-year rush expected before the books close on 2023.

As the market awaits new paper, the secondary space was quiet with the most recent deal to price continuing to dominate the tape.

Uber Technologies Inc.’s 0.875% convertible notes due 2028 continued to edge higher in active trade with broader equity markets either side of unchanged early in the session.

The Dow Jones industrial average was down 60 points, or 0.18%, the S&P 500 index was down 0.13%, the Nasdaq Composite index was up 0.05% and the Russell 2000 index was down 0.34% shortly before 11 a.m. ET.

There was $73 million in reported convertible bond trading volume about one hour into the session with Uber’s new notes the only issue to see more than $5 million on the tape.

The 0.875% convertible notes added another 0.5 point outright with stock up a little more than 1%.

The notes were changing hands at 102.875 versus a stock price of $56.06 early in the session, according to a market source.

There was $7 million in reported volume.

Uber’s stock was trading at $56.33, an increase of 1.61%, shortly before 11 a.m. ET.

The 0.875% notes have put in a strong aftermarket performance since the $1.5 billion issue priced on Nov. 20.

The strong demand for the paper and its aftermarket performance is a good sign for the market, sources said.

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