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Midday Commentary: Market steady as government shutdown continues; Morgan Stanley lists on NYSE
By Stephanie N. Rotondo
Phoenix, Oct. 2 - The preferred market was still holding its own as the second day of a government shutdown came to pass.
"The secondary is flat for the most part," a trader said, adding that trading was "not very liquid.
"There doesn't seem to be any major fund outflows going on," he added.
Morgan Stanley & Co. Inc.'s $750 million of 7.125% series E fixed-to-floating rate noncumulative preferreds were admitted to the New York Stock Exchange on Wednesday, listing under the ticker symbol "MSPE."
The issue was up 2 cents at midday at $25.35.
A trader said the Morgan Stanley preferreds - a deal that came Sept. 24 - along with Citigroup Inc.'s $900 million issue of 7.125% fixed-to-floating rate series J noncumulative perpetual preferred stock (NYSE: CPJ) have been "pretty active.
"They've got a great structure," he said. "I think insurance companies like them."
Citi's shares were trading at $25.47 at midday, up 8 cents from the previous close.
Of recent larger deals, the Allstate Corp.'s $350 million issue of 6.75% series C fixed-rate noncumulative perpetual preferreds is the only one that has yet to list. A trader speculated that the stock could begin trading on the NYSE as early as Friday but possibly not until early next week.
That deal came Sept. 23. The trader pegged the issue at $24.93 bid, par offered as of midday.
And, Tsakos Energy Navigation Ltd.'s $50 million of 8.875% series C cumulative redeemable perpetual preferred shares were quoted at $24.30 bid, $24.45 offered for a small chunk of stock, the trader said.
The paper priced Sept. 26 and freed to trade on Tuesday.
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