Preferreds rally with stocks; Deutsche Bank firms on debt buyback; Senior Housing freed

By Stephanie N. Rotondo

Seattle, Feb. 12 – The preferred stock market had a “nice little bounce” in Friday trading, according to one sellside source.

“It’s not a huge snap back, but that’s to be expected going into a long weekend,” he said. “Nobody wants to put risk on.”

The Wells Fargo Hybrid and Preferred Securities index finished up 91 basis points. The index was up 81 bps at mid-morning.

The broader markets were also rebounding, as retail sales data indicated that the economy is “relatively strong,” the trader said.

Still, “people don’t believe” that the economy or that banks are on an even keel, the trader said. It did help that Jamie Dimon, chief executive officer of JPMorgan Chase & Co., “put his money where his mouth is” and bought back $26.6 million of common stock.

Also helping to relieve investors’ concerns was news that Deutsche Bank AG planned to buy back $2 billion of dollar- and €3 billion of euro-denominated debt.

“So that’s good,” the trader said.

On the news, the German bank’s preferreds were ticking higher.

The 7.6% trust preferred securities (NYSE: DTK) were up $1.06, or 4.84%, at $22.95. The 8.05% TruPs (NYSE: DKT) were better by $1.11, or 4.92%, at $23.68.

Barclays Bank plc’s preferreds also “snapped back,” according to a trader.

The 8.125% series 5 noncumulative callable dollar preference shares (NYSE: BCSPD) gained 42 cents, or 1.75%, to end at $24.47.

Senior Housing frees

A trader said Senior Housing Properties Trust’s $250 million of 6.25% $25-par senior notes due 2046 freed to trade on Friday.

The issue priced Wednesday, coming upsized from $100 million and at the tight end of 6.25% to 6.375% price talk.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo Securities LLC, Citigroup Global Markets Inc. and RBC Capital Markets LLC ran the books.

The trader quoted the issue at $24.55 bid, $24.65 offered. Another market source said the notes closed at $24.53.

“That is also representative of its [volume weighted average price] of $24.527,” the source said.

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