Convertibles stabilize after early weakness; Janus Capital busy; Micron active on earnings

By Rebecca Melvin

New York, Sept. 26 – Convertibles opened a little weaker but found their footing and stabilized by midday on Friday. The convertibles market had dropped Thursday amid a slide in high yield and equities.

Convertibles followed the lead of high yield again early on Friday, lagging equities, but recovered, a New York-based trader said.

Volumes were light, so it was difficult to “make much sense of it,” the trader said. “But it seems to have stabilized.”

SolarCity Corp.’s new 1.625% convertibles recouped about 0.5 point on a dollar-neutral basis after dropping a point on their debut Thursday after the San Mateo, Calif.-based clean energy company priced $500 million of the five-year senior notes at the cheap end of talked terms.

Micron Technology Inc. was a focus of trade after the Boise, Idaho-based chipmaker reported better-than-expected revenue that rose 6% and guided higher on revenue for the current quarter. Micron shares surged 6.7%.

A volume name was Janus Capital Group Inc. following news that Bill Gross is leaving Pacific Investment Management Co., the fund he co-founded and of which he was chief investment officer, to join Janus.

Janus shares surged 31% to $14.60, and the Janus 0.75% convertibles changed hands at 143.44, according to Trace data. The convertibles were last about 128 or 129. In June, the Denver-based asset management company’s 0.75% convertibles traded at 126.35 with shares at $12.26.

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