Preferred market stays firm; Diana Shipping's issue frees to trade; recent deals active

By Stephanie N. Rotondo

Phoenix, Feb. 11 - Preferred stocks were again ticking higher in Tuesday trading.

The Wells Fargo Hybrid and Preferred Securities index was up 10 basis points as of mid-morning and ended the session 23 bps better.

There were no new issues announced, however, and one trader said he had yet to hear of any planned deals for the rest of the week.

"It just seems like the lower quality stuff is coming out, and it's not getting snapped up," he said, speculating that perhaps yields were not attractive enough to investors. "With rates at these levels, we should see stuff coming. It's a pretty cheap environment to raise money."

Among recently priced deals, Diana Shipping Inc.'s $60 million of 8.875% series B cumulative redeemable preferreds were seen at $24.55 bid early in the day.

About mid-afternoon, a trader said the paper was offered at $24.65.

A trader said the deal freed from the syndicate around noon ET.

It was a small deal, he said, noting "there's not a lot of attention being paid to it."

Diana Shipping priced on Monday.

Also in the shipping space, Seaspan Corp.'s $125 million of 8.25% series E cumulative redeemable preferreds were pegged at $24.80.

That issue came on Thursday.

In larger, rated deals, Citigroup Inc.'s $480 million of 6.875% series L noncumulative perpetual preferreds - a deal that priced Wednesday - was trading around $24.68. Other Citigroup issues continued to be active as well, with the 6.875% series K fixed-to-floating rate noncumulative preferreds (NYSE: CPK) closing at $25.32, up 7 cents, and the 7.875% fixed-to-floating rate trust preferreds (NYSE: CPN) rising a nickel to $27.22.

Verizon Communications Inc.'s $500 million of 5.9% $25-par notes due 2054 were meantime quoted at $24.80 bid, $24.88 offered.

Verizon priced Jan. 30.

In the secondary, JPMorgan Chase & Co.'s $850 million issue of 6.7% series T noncumulative preferreds (NYSE: JPMPB) were active but flat at $24.90.

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

And, Morgan Stanley & Co. Inc.'s 7.125% series E fixed-to-floating rate noncumulative preferreds (NYSE: MSPE) popped 15 cents in active trading to close at $26.34.

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