Morning Commentary: SoFi convertible notes in focus early, soar outright with stock

By Abigail W. Adams

Portland, Me., Jan. 19 – It was another quiet start to the day in the convertibles secondary space as equity markets struggled to find direction amid soaring Treasury yields.

While markets started the day strong, selling pressure turned indexes negative as the session progressed.

The Dow Jones industrial average was down 54 points, or 0.15%, the S&P 500 index was down 0.13%, the Nasdaq Composite was off 0.38% and the Russell 2000 index was 0.51% lower shortly before 11 a.m. ET.

There was $88 million in convertibles bond trading volume about one hour into the session although few names saw concentrated trading activity.

While markets were red early in Wednesday’s session, SoFi Technologies Inc.’s 0% convertible notes due 2026 were a bright spot in the session.

The notes soared on an outright basis alongside stock.

The 0% convertible notes gained about 6 points outright with stock up more than 12% early in the session.

The notes were changing hands at 98 versus a stock price of $13.54 early in the session.

SoFi’s stock was trading at $13.59, an increase of 12.70%, shortly before 11 a.m. ET.

Stock soared on news the personal finance company had passed a key regulatory hurdle to becoming a bank holding company.

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