Fannie, Freddie give back early gains post-earnings; AmTrust numbers ‘great’; Vornado busy

By Stephanie N. Rotondo

Phoenix, Aug. 7 – The preferred stock market was on the rise Thursday as new jobs data showed improvement.

The Wells Fargo Hybrid and Preferred Securities index increased 50 basis points by the end of business. It was up 24 bps at mid-morning as jobless claims dropped to 289,000 and the four-week average hit an eight-year low.

However, one market source said the gain in the index was not necessarily indicative of the market, given there was “really, really, really light volume.”

Fresh earnings were driving Fannie Mae and Freddie Mac paper higher early in the day, but those gains were given up by the market’s close.

A trader said that both mortgage giants reported profits that were below those seen in 2013, but the figures still beat expectations. Additionally, the two government-sponsored entities plan to pay a combined $5.6 billion to the government.

AmTrust Financial Services Inc. was also getting boosted by “great earnings,” a trader said. He remarked that the insurance company’s preferreds “jumped this morning, but they have kind of settled back down.”

Vornado Realty Trust’s 7.875% public income notes due 2039 (NYSE: VNOD) were the busiest of paying securities, a market source reported on Thursday.

The notes fell 2 cents to $25.46, with nearly 3 million bonds changing hands.

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