Morning Commentary: Fluidigm ‘comes in’ on the back of disappointing earnings; Post shares pop

By Rebecca Melvin

New York, Aug. 7 – U.S. convertibles ended the week notably soft on Friday after the July jobs report came in largely as expected and yielded lower Treasury bond rates and equities.

The employment statistics were deemed solid enough to keep the Federal Reserve on target for a rate rise as soon as next month.

Sellers were seen in the biotechnology sector. Fluidigm Corp.’s convertibles fell on an outright basis and contracted on a dollar-neutral, or swap, basis, a trader said, after the South San Francisco-based genomics and DNA research company reported disappointing earnings.

The Fluidigm bonds fell to 73 bid, 77 offered, the trader said. Fluidigm’s common shares fell 36% to $12.70.

“Fluidigm came in a lot. It’s trading all over the place and everyone is on a different delta, but it definitely came in,” the trader said.

Sequenom Inc.’s convertibles remained weak on Friday along with the underlying shares of the San Diego-based provider of genetic analysis products after it posted earnings on Wednesday that missed estimates.

Sequenom’s 5% convertibles, a small issue that priced in June, were last seen with an 89 handle, having slumped from the mid to upper 90s on Thursday, according to Trace data.

“It’s a special situation, so it is hard to find those bonds,” a trader said of Sequenom. But biotechnology convertibles overall were weaker.

“Things are selling off. There is no doubt about it,” the trader said.

Elsewhere, the common shares of Post Holdings Inc. popped early Friday after the St. Louis-based cereal maker reported third-quarter profit that exceeded estimates.

Third quarter sales rose 91% to $1.21 billion. A rise driven mainly by acquisitions.

Post also raised its forecast for the year, projecting adjusted earnings of as much as $650 million, which was up from a previous forecast for as much as $610 million.

Post shares were last up more than $7.00, or 14%, at $58.90.

Neither Post’s 5.25% mandatory convertibles nor its convertible preferreds were heard in trade.

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