Midday Commentary: Preferred stocks dip with long bond; Fannie, Freddie remain active, strong

By Stephanie N. Rotondo

Phoenix, Sept. 5 - Preferred stocks were selling off a bit as long Treasuries came in on the back of "better than expected" weekly jobs numbers, according to a trader.

As of midday, the Wells Fargo Hybrid and Preferred Securities index was off 28 basis points, or about 7 cents per share on average for $25-par paper.

Though a market source had indicated that volumes were improving in the previous session, Thursday trading was muted aside from continued activity in Freddie Mac and Fannie Mae preferreds.

The agencies' preferreds were boosted on Wednesday after Fairholme Capital's Bruce Berkowitz went on CNBC stating that the securities were attractive and calling for the government to return the entities to private hands.

Come Thursday, the securities remained firm as Freddie's 8.375% fixed-to-floating rate noncumulative perpetual preferreds (OTCBB: FMCKJ) rose a nickel by midday to $5.37. Fannie's 8.25% series S fixed-to-floating rate noncumulative preferreds (OTCBB: FNMAS) increased 3 cents to $5.36.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.