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Lazy day for preferreds as market readies for long weekend; Citigroup calls 6.1%TruPS
By Stephanie N. Rotondo
Phoenix, Aug. 30 - A preferred stock trader said there was very little activity in the market on Friday, given that most were already gearing up for the three-day Labor Day weekend.
"There's no real news out here in PreferredLand," he said, aside from Citigroup Inc.'s announcement late Thursday that it would redeem $369 million of 6.1% trust preferreds (NYSE: CPR).
"It's interesting that they would call that low of a coupon," the trader said. However, he said it could be a sign that more redemptions are on the horizon, which could likely result in more new issues.
The securities were trading up 40 cents, or 1.6%, to $25.36 at the close.
The redemption will take place on Oct. 1. The call price is par plus 0.0042361 cents.
Overall, the preferred arena stayed firm, even as secretary of state John Kerry said there was compelling evidence that the Assad regime in Syria had used chemical weapons and president Barack Obama said he was considering "limited" action against the country.
The Wells Fargo Hybrid and Preferred Securities index ended the day up 25 basis points, or about 6 cents on average for $25-par paper.
JPMorgan, Comcast rise
Volume for the day was limited as many players were away from their desks, taking an early advantage on the long weekend. Of paying securities, only one issue traded above 300,000 shares: JPMorgan Chase & Co.'s 5.5% series O noncumulative perpetual preferreds (NYSE: JPMPD).
The issue closed up 29 cents, or 1.32%, at $22.24. The 8.625% series J noncumulative preferreds (NYSE: JPMPI) were also active but steady at $24.99.
The Js will be redeemed on Sept. 1.
Among other relatively active issues, Barclays Bank plc's 8.125% series 5 noncumulative callable dollar preference shares (NYSE: BCSPD) ended off 3 cents at $25.25.
Comcast Corp.'s 5% $25-par notes due 2061 (NYSE: CCV) meantime finished the day 26 cents, or 1.17%, higher at $22.42.
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