Preferred stocks improve as Yellen makes case for rate hike; Qwest notes active, strong

By Stephanie N. Rotondo

Seattle, Aug. 26 – The preferred stock market was trending higher on Friday as Federal Reserve chairman Janet Yellen indicated that another interest rate hike was appropriate.

The Wells Fargo Hybrid and Preferred Securities index finished the day up 15 basis points. The index was up 4 bps at mid-morning.

Recently priced issues were also inching upward, though liquidity was thin.

Qwest Corp.’s 6.5% $25-par senior notes due 2056 (NYSE: CTBB) remained active, rising a nickel to $25.64 in early trading. It ultimately closed at $25.675, a gain of 8 cents on the day.

Over 820,000 preferred shares traded, making the issue the most active of the day.

Legg Mason Global Asset Management’s $500 million of 5.45% $25-par junior subordinated notes due 2056 (NYSE: LMHB) were meantime steady at $25.01. By comparison, only 254,000 of the notes were exchange during the final trading session of the week.

Qwest priced Aug. 11. Legg Mason came Aug. 3.

Yellen, speaking from a three-day meeting of central bankers – both foreign and domestic – in Jackson Hole, Wyo., said that employment and “price stability” were nearing the levels the Fed wanted to see, thus making a case for another rate increase this year.

“In light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase in the Federal Funds rate has strengthened in recent months,” Yellen said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.