Primary calendar expected to grow next week; Bank of America’s recent deal active, firm

By Stephanie N. Rotondo

Phoenix, Jan. 29 – Preferred stocks were considered flat at the end of Thursday trading, and one trader noted that liquidity was muted.

“It’s very quiet,” he said.

Another market source said the market operated within a narrow range, starting the day down a touch, moving up a touch and so on until the end of business.

“I think there was a little bit of market manipulation in the last few minutes of trading,” he said.

The Wells Fargo Hybrid and Preferred Securities index closed down 3 basis points. It was up 1 bp at mid-morning.

With the week nearly at its end, the new issue pipeline remained silent. A trader remarked that with the snowstorm in the Northeast, “people wanted to wait and see what the Fed was going to do.” As the central bank indicated Wednesday that it would not raise interest rates at least until June, it’s “prime time for these companies that have put out earnings” to come with new deals.

The trader further opined that “we might see a few deals come next week.”

Still, investors continued to focus on Bank of America Corp.’s $1 billion of 6.5% series Y noncumulative preferreds (NYSE: BACPY), a deal from Jan. 20.

The preferreds finished the day at $25.23, up 7 cents on more than 2.33 million shares trading.

A trader said the preferreds had traded up to as high as $25.25.

The paper was trading at $25.21 at mid-morning, up a nickel from the previous day’s close.

The issue listed on the New York Stock Exchange on Wednesday.

BofA’s 6.625% series W noncumulative preferreds (NYSE: BACPW) were meantime also busy, though not nearly as much as the newer deal. Those preferreds closed a dime higher at $25.89, on over half a million shares traded.

Among the day’s other actively traded issues, Morgan Stanley & Co. Inc.’s 6.375% series I fixed-to-floating rate noncumulative preferreds (NYSE: MSPI) rose 2 cents to $25.80, while Wells Fargo & Co.’s 5.85% series Q class A fixed-to-floating rate noncumulative perpetual preferreds (NYSE: WFCPQ) improved by 4 cents, ending at $25.67.

Goldman Sachs & Co.’s 6.375% series K fixed-to-floating rate noncumulative preferreds (NYSE: GSPK) meantime earned 14 cents to $26.15, while First Republic Bank’s 5.625% series C noncumulative perpetual preferreds (NYSE: FRCPC) put on 15 cents to finish at $25.05.

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