Preferred stocks drift lower; liquidity slightly improved; American Realty weakens further

By Stephanie N. Rotondo

Phoenix, Dec. 16 – Liquidity in the preferred stock market remained weak Tuesday as the space drifted lower.

“Looks like most of my screen is red,” one trader said, though he added it was “nothing major.”

Another market source said volume was “not exactly gangbusters” but noted that it was “probably a little bit better” than it has been all week.

The Wells Fargo Hybrid and Preferred Securities index closed off 22 basis points. The index was down 8 bps at mid-morning.

American Realty Capital Properties Inc. was dominating trading in paying securities following news out Monday regarding the departure of the company’s top three executives.

On the news, the 6.7% series F cumulative redeemable preferreds (Nasdaq: ARCPP) were lower, closing 29 cents, or 1.36%, softer at $21.09.

The paper had lost 52 cents in the previous session.

Nicholas Schorsch, executive chairman and director, left his post, the New York-based real estate investment trust said in a statement on Monday. Schorsch was a co-founder of the company and formerly its chief executive officer.

Also leaving were David Kay and Lisa Beeson, CEO and chief operating officer, respectively.

No specific reason was given for the latest round of resignations.

American Realty hopes that investors will look on the exits as a positive, as the REIT looks to move forward with its strategy.

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