Preferreds initially weak, recover by the bell; Goldman holds steady; Wells Fargo ETF up

By Stephanie N. Rotondo

Seattle, Feb. 19 – The preferred stock market was in retreat early Friday but recovered by day’s end.

The initial softness came as the broader markets also lost momentum, driven by renewed declines in oil and a larger-than-expected rise in consumer prices that have some pondering an interest rate hike this year.

The Wells Fargo Hybrid and Preferred Securities index closed up 38 basis points. The index was off 27 bps at mid-morning.

“The hybrid market is stuck in the mud,” one trader said, adding that things overall were “super quiet.”

Goldman Sachs Group Inc.’s $675 million of 6.3% series N noncumulative preferreds continued to be on the busier side. In fact, the new issue dominated trading with nearly 1.95 million preferreds trading.

The preferreds ended unchanged at $25.12. Earlier in the day, a trader said the recently priced issue was “still right where it was yesterday,” trading around $25.05.

Another market source placed the issue at that level but deemed it down 7 cents.

The deal came Monday via Goldman Sachs & Co. and is trading under the temporary ticker “GSHSP.”

Meanwhile, activity in the SPDR Wells Fargo Preferred Stock ETF (NYSE: PSK) picked up considerably, trading over 1 million times.

The index ended up 43 bps.

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