Morning Commentary: American Express plans $1,000-par new issue; Gladstone prices term preferreds

By Stephanie N. Rotondo

Phoenix, Nov. 5 – As Republicans took over Congress after the midterm elections, a trader said an expected rally wasn’t being seen in the preferred stock market.

However, the common equity markets were on the rise in early trading.

The Wells Fargo Hybrid and Preferred Securities index was off 4 basis points at mid-morning.

American Express Co. added another $1,000-par deal to the new issue calendar Wednesday. The New York-based company intends to sell series B fixed-to-floating rate noncumulative perpetual preferreds, according to a regulatory filing.

But because the issue is $1,000-par, one preferred trader said he wasn’t seeing a lot of details or markets for the paper.

Citigroup Global Markets Inc., BofA Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co. and Wells Fargo Securities LLC are the joint bookrunning managers.

Meanwhile, Gladstone Investment Corp. priced its offering of series B cumulative term preferreds, “finally,” a trader said.

The Janney Montgomery Scott LLC-led deal was originally announced on Monday.

The preferreds came at par to yield 6.75%.

The trader said he had not seen any markets for the preferreds, noting its small size.

As was expected, Capital One Financial Corp.’s $500 million of 6.7% series D fixed-rate noncumulative perpetual preferred stock began trading on the New York Stock Exchange under the ticker symbol “COFPD.”

“It’s doing well,” a trader said, pegging the issue at $25.30.

The deal came Oct. 28.

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