Midday Commentary: Market turns higher as Fed taper seen delayed and investors search for yield

By Stephanie N. Rotondo

Phoenix, Aug. 22 - The preferred stock market was getting a "bounce," a trader said Thursday.

"The jobs numbers were a nonevent," he noted, as the figure came in line with expectations. He opined that the gains seen "across the board" were due to the Federal Reserve's statement on Wednesday that indicated the central bank was not planning to taper its stimulus program anytime soon.

"It just shows that the preferred market was oversold," he said, pointing to the day's gains.

The trader also commented on a Bloomberg story out early Thursday that said investors were "having a tough time replacing yield because of all the structured notes that have been called.

"That could push this market higher," he said of investors' search for yield.

As for the day's trading activity, Zions Bancorporation's 9.5% series C noncumulative preferreds (NYSE: ZBPC) were quite active, rising a penny to $25.59 at midday.

On Aug. 15, the Salt Lake City-based bank said it was redeeming the entire $799.5 million issue on Sept. 15.

The redemption price is par plus approximately 61 cents.

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