Morning Commentary: Preferreds retreat as 2016 trading begins; Mideast tensions, China in focus

By Stephanie N. Rotondo

Seattle, Jan. 4 – The preferred stock market opened the inaugural trading session of 2016 with a weaker tone.

The Wells Fargo Hybrid and Preferred Securities index was down 41 basis points at mid-morning.

A trader noted that oil prices were rising amid tensions between Iran and Saudi Arabia. Saudi Arabia is looking to impose sanctions on its Middle Eastern neighbor after it was reported that the Saudi embassy in Tehran was stormed on Sunday.

Also weighing on the markets were the latest PMI figures from China, which contracted in the most recent month. That then resulted in the China stock market falling about 7%, at which point trading was halted.

The weakness then invaded the domestic markets.

As for preferreds specifically, a trader said it was “quiet,” adding that he had heard no new deal talk just yet.

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