MGM extends gains as maturity looms; Anthem slips at full delta as shares rip; Ctrip gains

By Rebecca Melvin

New York, March 18 – A dramatic reversal in markets, including the convertibles market, on Wednesday, which were lower to start and shot higher in the afternoon, seemed out of step with changes in the latest Federal Reserve policy, which demonstrates a slightly more dovish stance toward raising interest rates compared to January but is largely in line with expectations, sources said.

“I feel like everything was for sale and now everything is to buy,” a New York-based convertibles trader said of the session.

MGM Resorts International’s convertibles continued to move up on both an outright and dollar-neutral, or hedged, basis after the bonds surged on Tuesday. The stock vol. move was spurred by chatter that activist Land and Buildings is pushing the Las Vegas-based casino operator to convert to a real estate investment trust and spin off its real estate assets. The vol. move wasn’t indicative of the overall market, however, a trader said.

Anthem Inc.’s 2.75% convertible bonds due 2042 were up on an outright basis but lower on a hedged basis on the heaviest deltas after shares of the Indianapolis-based health benefits company shot up post Fed news.

Ctrip.com International Ltd.’s convertibles traded Wednesday and improved on a swap basis ahead of the Chinese interest site’s quarterly results expected on Thursday.

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