Merkel comments give banks a leg up; Inland Real Estate, Associated deals list on NYSE

By Stephanie N. Rotondo

Portland, Ore., Oct. 10 - Despite it being a holiday for some markets, the preferred stock market was having a "good day" on Monday, according to a trader.

"Everything is up," he said.

He attributed the gains to comments made by German chancellor Angela Merkel at a joint press conference with French president Nicolas Sarkozy in Frankfurt on Sunday.

"We are determined to do all that is necessary to guarantee bank recapitalization," Merkel said at the conference.

The comments - combined with word that a plan to shore up the banks should be forthcoming by the end of the month - helped foreign issuers like Aegon NV and ING Groep NV gain ground early in the session, though Aegon ended mixed and ING closed generally weaker.

"It was also putting wind in the sails of issues here," a trader said, seeing names like Bank of America Corp. and Ally Financial Inc. moving upward.

Meanwhile, recent new issues from Inland Real Estate Corp. and Associated Banc-Corp officially listed on the New York Stock Exchange on Monday.

Foreign, domestic banks gain

Indications that Europe could have a plan to shore up its banks by the end of October gave preferreds - both foreign and domestic - a boost on Monday.

Among foreign issuers, Aegon preferreds ended the day mixed. The 6.5% perpetual capital securities (NYSE: AED) gained 15 cents, closing at $19.77, while the 7.25% perpetual capital securities (NYSE: AEF) slipped a nickel to $21.96.

Barclays Bank plc's 8.125% series 5 noncumulative callable dollar preference shares (NYSE: BCSPD) were better, gaining 70 cents, or 3.02%, to $23.90, and HSBC Holdings plc's 8% exchangeable perpetual subordinated capital securities (NYSE: HCSPB) earned 6 cents, ending at $25.26.

ING spent most of the day in the green, but fell off toward the end of the day.

The 8.5% perpetual hybrid capital securities (NYSE: IGK) lost 3 cents, closing at $23.71, while the 6.375% perpetual hybrid capital securities (NYSE: ISF) lost 16 cents, ending at $18.06.

In domestic issues, Bank of America's 8.2% series H depositary shares (NYSE: BACPH) headed up 66 cents, or 2.94%, at $23.10. Ally Financial's preferreds were also better, with the 8.5% series A preferreds (NYSE: ALLYPA) gaining 47 cents, or 2.58%, to $18.67 and the 8.125% trust preferreds (NYSE: ALLYPB) increasing by 90 cents, or 5.23%, to $18.10.

Morgan Stanley earnings ahead

A trader said that Morgan Stanley is expected to release earnings on Thursday.

"If the numbers are stronger than expected, or even as expected, it could be a good boost midweek," he said.

Preferreds listed

Inland Real Estate's recent 8.125% series A cumulative redeemable preferreds - a $50 million issue that priced Oct. 6 - listed on the NYSE Monday.

The symbol is "IRCPA."

Associated Banc-Corp's 8% series B perpetual preferreds also listed under the ticker "ABWPB."

The $65 million issue priced Sept. 7.

Inland Real Estate's preferreds closed at $24.70, while the bank issue finished at $24.61, a gain of 36 cents.

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