Morning Commentary: Equity sell-off accelerates; OakStreet, Fisker convertibles down

By Abigail W. Adams

Portland, Me., Jan. 24 – The convertibles secondary market was active early in Monday’s session as equity indexes opened deep in the red.

The Dow Jones industrial average was down 578 points, or 1.69%, the S&P 500 index was down 2.14%, the Nasdaq Composite was down 2.46% and the Russell 2000 index was down 1.37% shortly before 11 a.m. ET.

There was $130 million in convertible bonds trading volume about one hour into the session.

With equities as low as they have been, some of the trading activity may be the result of margin calls, a source said.

Oak Street Health Inc.’s 0% convertible notes due 2026 were the most actively traded issue early in Monday’s session.

The 0% convertible notes were down 2 points with stock off almost 7% early in Monday’s session.

The notes were changing hands at 71.5 versus a stock price of $16.38, according to a market source.

There was $8 million in reported volume.

Oak Street’s stock was changing hands at $16.37, a decrease of 6.19%.

Fisker Inc.’s 2.5% convertible notes due 2026 were under pressure in active trading.

The 2.5% convertible notes were down more than 5 points with stock off more than 11%.

The notes were trading at 84.25 versus a stock price of $10.85 early in the session.

There was about $6 million in reported volume.

Fisker’s stock was changing hands at $10.75, a decrease of 10.48%, shortly before 11 a.m. ET.

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