Midday Commentary: New issues weaken in line with broad market; Senior Housing, Vornado list

By Stephanie N. Rotondo

Phoenix, July 23 - The preferred stock market was trading softer Monday, following a trend set by the broader financial markets.

"Everyone is afraid of Spain again," a trader said.

The fear was also affecting the primary arena, as chatter of a new deal from a domestic bank fizzled.

"There was talk of a new deal in a domestic bank, but that did not materialize," a trader said, pointing to a declining equity market as a possible reason for the no-show. He speculated that the deal could still come Tuesday.

"All the new issues seem to be weaker," he added.

Stanley Black & Decker Inc.'s $750 million of 5.75% $25-par junior subordinated notes due 2052 were "holding in" at $25.20, though that was still weaker than Friday levels.

Invesco Mortgage Capital Inc.'s $135 million of 7.75% series A cumulative redeemable perpetual preferred stock meantime had bids of $24.50, according to a trader. That deal priced Thursday.

But it was CommonWealth REIT's new $175 million issue of 5.75% $25-par senior notes due 2042 that was "getting beat up," the trader said.

He saw the notes quoted at $24.00 bid, $24.30 offered. The deal priced Friday.

Meanwhile, several recent issues listed on the New York Stock Exchange Monday, including Senior Housing Properties Trust's 5.625% $25-par senior notes due 2052 and Vornado Realty Trust's 5.7% series K cumulative redeemable preferreds.

Senior Housing's securities (NYSE: SNHN) were trading at $23.94 at midday, while Vornado's issue (NYSE: VNOPK) was down 4 cents at $24.65.

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