Market quiet as focus shifts to earnings; Accuray sees outright interest; Salix in line

By Rebecca Melvin

New York, July 9 – U.S. convertibles traded languidly on Wednesday, and the planned Macquarie Infrastructure Co. LLC deal for $250 million of convertible senior notes wasn’t seen garnering too much attention ahead of final terms to be fixed after the market close, a New York-based trader said.

“Things have really slowed down here the last week and a half,” the trader said.

No gray market was seen in the planned Macquarie deal, a New York-based sellsider said.

As earnings season kicks off, there was an expectation that volatility will pick up and spur market activity, but there was no evidence of that occurring to date, a trader said.

One bond that has generated some interest in the last few days is the Accuray Inc. 3.5% convertibles, which were down about 5 points since Monday to 95ish amid a stock move lower, a trader said.

The Accuray bonds were called unchanged on a hedged basis, but the outright move has attracted some outright buyers that have stepped in at the lower, absolute levels.

Salix Pharmaceuticals Ltd.’s convertibles traded down on an outright basis but were also seen unchanged, or in line with lower shares, on a dollar-neutral basis after the Raleigh, N.C.-based drug maker said late Tuesday that it has agreed to acquire the Irish division of Italian drug maker Cosmo Pharmaceuticals SpA and will reincorporate in Ireland.

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