Morning Commentary: Preferreds kick week off with negative tone; Wells Fargo, Maiden buck the trend

By Stephanie N. Rotondo

Seattle, July 24 – The preferred stock market was starting the new week off with a weaker tone early Monday.

The Wells Fargo Hybrid and Preferred Securities index was off 24 basis points at mid-morning. The U.S. iShares Preferred Stock ETF was down 3 bps.

And, while liquidity continued to be subdued, what was trading actively in early dealings was bucking the downward trend.

For instance, Wells Fargo & Co.’s 5.625% class A series Y noncumulative preferreds (NYSE: WFCPrY) were up 8 cents at $25.85.

There was no fresh news out on the San Francisco-based bank, though it was reported on Friday that it had potentially gotten itself in hot water yet again by releasing sensitive client information to a former employee.

The employee, through his legal counsel, was seeking documents from Wells Fargo related to a defamation lawsuit. The client data was included in what was sent to the attorney.

The bank said the release was an accident and that it was investigating to see how such a breach occurred.

Meanwhile, Maiden Holdings Ltd.’s 6.7% series D noncumulative preference shares (NYSE: MHPrD) were also busy and better, adding 9 cents to trade at $25.04.

In GSE paper, Freddie Mac’s 8.375% fixed-to-floating rate noncumulative preferreds (OTCBB: FMCKJ) were 40 cents, or 6.80%, higher at $6.28.

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