Ally follows preferred market trend, closes mixed; RBS, Citi trade active; Evolution a no-show

By Stephanie N. Rotondo

Portland, Ore., June 27 - The preferred stock market ended with a mixed tone Monday, and a trader said that overall, it was "painfully quiet."

The trader blamed the day's lackluster performance on the upcoming Fourth of July weekend as well as Greece's and the United States' budget talks. As "people are reaching for yield right now," there was little incentive to move things one way or another, he said.

"It was very, very quiet," another trader said. "You could tell it was going to be from the start."

Echoing the trend of the market, Ally Financial Inc.'s two series of preferreds closed out the session mixed. The issues were also the day's most actively traded securities.

Meanwhile, other financials such as Royal Bank of Scotland Group plc and Citigroup Inc. stayed active, also finishing in mixed fashion.

The new issue calendar is expected to remain light for the next week or so. Evolution Petroleum Corp. is expected to price a small - and possibly discounted - deal sometime this week.

Ally follows market

Ally Financial's 8.5% series A preferreds (NYSE: ALLYPA) rose a nickel to $24.85 on volume of about 1.2 million preferreds.

The 8.125% series B preferreds (NYSE: ALLYPB), however, dropped a dime to close at $24.29. Volume on the Bs was about 1.01 million preferreds.

There was no news out on the Detroit-based financial services company, but the preferreds tend to gyrate within the context of the market.

RBS, Citi active, mixed

Also trading actively were Royal Bank of Scotland's series E preferreds (NYSE: RBSPE). They fell 29 cents to $14.00.

Citi's floating-rate series J preferreds (NYSE: CPJ) meantime closed 7 cents higher at $25.68.

HSBC Holdings plc's series B perpetual preferreds (NYSE: HCSPB) were also trading busily, closing 8 cents lighter at $27.08.

No word on Evolution

Evolution Petroleum's "best-efforts" underwritten offering of 400,000 shares of 8.5% series A cumulative preferred stock did not price Monday, and several market sources said they had heard little about the new issue. The deal was announced Thursday.

One trader opined that the preferreds could be sold at $23.50. That speculation could prove to be true, as the deal is structured similarly to a recent new issue launched by Gastar Exploration USA Inc.

Under that deal, Gastar issued about 650,000 shares at $23.25.

McNicoll, Lewis & Vlak LLC - a relative newcomer to the financial services sector - is the bookrunner on both the Evolution and Gastar deals.

Gastar announced the sale of the 8.625% series A preferreds on June 14. The deal priced June 20, and a dividend was declared on June 23.

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