Preferreds improve despite mixed economic data; Vanguard Natural Resources plans unit sale

By Stephanie N. Rotondo

Phoenix, Nov. 26 - Preferred stocks were again firm on Tuesday, even with the presence of mixed economic data.

The Wells Fargo Hybrid and Preferred Securities index was up 21 basis points.

One trader said he had expected some weakness to seep in, given that consumer confidence had fallen to its lowest point since April. He also noted that new housing data was mixed, with one report indicating single-family home prices had risen and another saying they had slipped.

Overall liquidity was also muted, due in part to Thanksgiving on Thursday. Hanukkah begins Wednesday evening as well.

"This whole week is going to be dead," the trader said.

Vanguard Natural Resources LLC said Tuesday that it was launching an "at-the-market" sale of up to $250 million 7.875% series A cumulative redeemable perpetual preferred units. Proceeds from the sale could be used to pay down debt.

The units (Nasdaq: VNRAP) ended Monday's session at $26.50. By the end of business Tuesday, they were trading down a quarter to $26.25.

Maiden joining NYSE

Maiden Holdings North America Ltd.'s $152.5 million of 7.75% senior notes due 2043 will be admitted to the New York Stock Exchange on Wednesday, a market source reported.

The deal priced Nov. 18. The ticker symbol is "MHNC."

The notes closed the day at $24.94, which was up 55 cents, according to a source. However, he opined that the higher trades were done by syndicate managers and noted that the volume weighted average price was $24.46.

Citigroup stays busy

Citigroup Inc.'s 6.875% series K fixed-to-floating rate noncumulative preferreds (NYSE: CPK) have been actively trading for the last week or more though there has been no news to act as a catalyst.

In Tuesday trading, the issue finished flat at $25.09, with over 300,000 shares changing hands.

"I think there was just a lot of stock that needed to be put away," one trader speculated about the volume in the issue. "It just needs to be absorbed."

The trader also remarked that the securities were "more of an institutional play."

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