Midday Commentary: Preferreds see modest gains, muted volume; no details on American Homes deal

By Stephanie N. Rotondo

Phoenix, April 2 - Preferred stock trading was muted as Wednesday's session began, a trader reported.

"Everything is just waiting on some deals of some kind," he said.

On Tuesday, American Homes 4 Rent announced plans to offer up to $115 million - including a $15 million greenshoe - of series C cumulative preferreds. However, the trader said he had yet to see any details aside from what the company said in its registration statement.

Morgan Stanley & Co. LLC, Raymond James & Associates Inc. and Jefferies LLC are leading the deal.

Despite the lackluster volume, the preferred market was inching higher, as the Wells Fargo Hybrid and Preferred Securities index improved by 5 basis points as of mid-morning. The modest gains came on the back of a new ADP report that showed the private sector added 191,000 jobs in March, just slightly below the 195,000 jobs analysts polled by Reuters were expecting.

Additionally, ADP revised February's reading to an additional 178,000 jobs, versus the 139,000 jobs initially reported.

Also on the data front, U.S. factory orders saw a gain in February, despite inclement weather. Orders increased 1.6% during the month.

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