Midday Commentary: Market gives back some of previous day's gains; CHS expected to price Thursday

By Stephanie N. Rotondo

Phoenix, Sept. 19 - Preferred stocks were trading off a touch early Thursday after popping on Wednesday after the Federal Reserve put its plan to taper a stimulus program on hold.

Despite the minor dip, the new issue market seemed to be opening back up.

As previously reported, CHS Inc. had said in early September that it was planning an offering of up to $250 million class B reset rate cumulative redeemable preferred stock. On Thursday, a market source said the deal was expected to price during Thursday business.

Price talk is 7.75% to 8%, according to the source.

The source saw a gray market quote for paper at $24.60 bid, $24.80 offered.

The source also noted that the company's existing 8% cumulative redeemable preferreds (Nasdaq: CHSCP) were trading at quite a high premium.

"[The preferreds] are starting to get pushed down a little [in the wake of the new deal], but nowhere near where it should be."

At midday, the issue was trading off $1.02, or 3.08%, to $32.10.

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