Preferreds tick up amid limited liquidity; RAIT notes firm; Fannie Mae cuts housing view

By Stephanie N. Rotondo

Phoenix, Aug. 18 – It was quiet in the preferred stock market as Monday’s session got underway, a trader reported.

“The long bond is off,” he noted, adding that the dip wasn’t really news driven given that it was a muted weekend, aside from ongoing rioting near St. Louis.

The Wells Fargo Hybrid and Preferred Securities index was up 19 basis points at mid-morning and climbed all the way up to end 30 bps firmer.

Meanwhile, Red Mountain Resources Inc. said last week that it was planning a sale of 10% series A cumulative redeemable preferred stock via Northland Capital Markets and Euro Pacific Capital. On Monday, the Dallas-based energy company announced that it would hold a conference call on Tuesday to discuss the sale.

From last week’s business, RAIT Financial Trust’s $70 million of 7.125% $25-par notes due 2019 were holding around $24.75.

The deal came Aug. 11 and has yet to receive a temporary reporting symbol, the trader said.

A trader said there was news out regarding Fannie Mae and Freddie Mac but that the agencies’ preferreds were “not moving around much.”

On Monday, Fannie reduced its housing market outlook for 2014 and 2015, noting that inclement weather combined with consumer “conservatism” had already pressured the space during the first half of 2014.

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