Midday Commentary: Market awaits FOMC comments; Full Circle launches notes sale; Citigroup busy

By Stephanie N. Rotondo

Phoenix, June 19 - The preferred stock market was in a bit of a holding pattern on Wednesday as investors were awaiting an announcement from the Federal Reserve's Federal Open Market Committee later in the day.

"We're just waiting to see what the Fed says," a trader remarked. "That's going to dictate where this market goes."

He added that most are anticipating that nothing will be said that will hurt the housing market and that the FOMC will look to "strengthen the dollar against the yen."

If that is the case, the trader speculated, the market should maintain the status quo.

In the primary arena, Full Circle Capital Corp. launched an offering of at least $30 million of $25-par notes due 2020.

The company had originally proposed the sale on May 2, with $25 million notes expected to price.

A trader said price talk was 8% to 8.25%, though he had not seen any markets in the non-rated deal.

"These small deals just get put away," he said.

In the secondary, Citigroup Inc.'s 6% trust capital securities (NYSE: CPS) were trading actively between par and $25.01. A trader said the activity could be due to a belief that the issue will be the next to be called.

"All of these [Citigroup] issues are callable at any time," he said. "There's really no upside on this. But if you are worried about rates, this could be a good place to put money if you think it is going to be called."

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