Morning Commentary: Fed’s ‘non-action’ boosts preferreds; Goodrich shares retreat with crude prices

By Stephanie N. Rotondo

Phoenix, Sept. 18 – Preferred stocks “moved up a little bit because of non-action on the part of the Fed,” a trader said early Friday.

The Wells Fargo Hybrid and Preferred Securities index was up 2 basis points at mid-morning.

On Thursday, the Federal Reserve decided to keep short-term interest rates steady for the time being, citing global economic concerns and recent volatility in domestic markets. And while the decision is seen as a boon to preferred stock issuers – “we will probably start seeing some new issues coming out the beginning of next week,” a trader said – the uncertainty caused the broader equity markets to weaken.

Oil prices also took a hit, with domestic crude prices dropping 3.71% in early Friday trading.

The decline of the commodity then put pressure on oil and gas names, which have already been struggling amid the weak price environment.

Goodrich Petroleum Corp.’s 9.75% series D cumulative preferreds (NYSE: GDPPD) were down 11 cents, or 6.5%, at $1.58 at mid-morning. The 10% series C cumulative preferreds (NYSE: GDPPC) were off 11 cents, or 6.4%, at $1.62.

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