Morning Commentary: Twitter convertible notes remain in focus, come in after buyout

By Abigail W. Adams

Portland, Me., April 26 – The convertibles secondary space remained quiet as selling pressure returned to equities after Monday’s turbulent session.

The Dow Jones industrial average was down 371 points, or 1.08%, the S&P 500 index was down 1.53%, the Nasdaq Composite index was down 2.64%, and the Russell 2000 index was down 1.84% shortly before 11 a.m. ET.

Trading activity in the convertibles secondary space remained light amid the renewed selling pressure.

There was $87 million in reported volume about one hour after the opening bell with one name accounting for more than one-fourth of the total reported volume on the tape.

Twitter Inc.’s convertible notes continued to dominate trading following Monday’s surprise news that the social media company had agreed to Elon Musk’s buyout offer.

The notes were weaker during Tuesday’s session.

Twitter’s 0% convertible notes due 2026 were down about 0.25 point outright. They were changing hands at 96.125 versus a stock price of $50.92 early in the session.

There was $15 million in reported volume.

Twitter’s 0.25% convertible notes due 2024 fell more than 1 point outright and were trading at 109.25 versus a stock price of $50.85.

Twitter’s stock was trading at $50.02, a decrease of 3.24%, shortly before 11 a.m. ET.

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