Morning Commentary: Preferred trading remains thin post-stress tests; recent deals quieter

By Stephanie N. Rotondo

Seattle, June 23 – The preferred stock market was again on the firmer side early Friday, though hopes for a bump in trading volume appeared to be dashed.

On Thursday, a market source opined that the release of the Federal Reserve’s first round of bank stress test results – in which all U.S. banks were found to have sufficient capital to weather a significant economic downturn – could entice investors into the market.

But come mid-morning dealings on Friday, a trader noted that there was “nothing going on.”

Indeed, even recently priced issues seemed to be losing their appeal, as there was limited trading in Southern California Edison Co.’s SCE Trust VI’s $475 million of 5% series L trust preference shares or Compass Diversified Holdings LLC’s $100 million of 7.25% series A preferred stock.

The SCE Trust issue was quoted at $24.96 bid, $24.98 offered while the Compass paper was pegged at $24.80 bid, $24.87 offered.

Validus Holdings Ltd.’s 5.8% series B noncumulative preference shares (NYSE: VRPrB), however, were a little more active, ticking up 2 cents to $25.29.

The $250 million deal priced on June 13 and began trading on the New York Stock Exchange on Wednesday.

© 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.