Morning Commentary: Secondary market quiet at open; Wayfair convertibles trade down

By Abigail W. Adams

Portland, Me., Aug. 31 – The convertibles secondary space launched the week quietly with $41.2 million on the tape about one hour into the session.

With not much activity expected from the primary market leading up to the Labor Day holiday, sources were expecting the slow pace to extend for the remainder of the week.

Southwest Airlines Co.’s 1.25% convertible notes due 2025 dominated the tape, accounting for nearly half of the reported volume early in the session.

The 1.25% convertible notes were changing hands around 134 with more than $14 million on the tape about one hour into the session.

Southwest stock was trading off early Monday and was changing hands at $37.97, a decrease of 2.19%, shortly before 11 a.m. ET.

Wayfair Inc.’s 0.625% convertible notes due 2025 were also active and trading down on an outright basis as stock dropped.

The 0.625% notes were down more than 4 points outright as stock dropped more than 6%.

The recently priced convertibles were changing hands around 102.25 early in the session with more than $8 million on the tape.

Wayfair stock traded as low as $287.31 but pared its losses and were changing hands at $296.57, a decrease of 4.51%.

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