Preferreds tick up after FOMC minutes; housing data, Nasdaq glitch make little impact

By Christine Van Dusen

Atlanta, Aug. 23 - The preferred stock market on Friday morning was unchanged to slightly better after the Federal Open Market Committee's minutes sent U.S. Treasury rates up. The market was largely unaffected by weaker-than-expected housing data and a glitch that temporarily halted Thursday trading in the Nasdaq Stock Market.

"We were watching the housing numbers and they came in a lot worse than everyone expected, which was kind of bad because of the rates backup," a trader said. "I think people are thinking that the tapering that we thought would be in September may not be as strong as previously thought. So for that reason all the fixed income [securities] are starting to move up a little."

In trading on Friday morning, Zions Bancorporation's 9.5% series C noncumulative preferreds (NYSE: ZBPC) were most active, quoted at $25.60 during the morning, flat from Thursday's close.

On Aug. 15, the Salt Lake City-based bank said it was redeeming the entire $799.5 million issue on Sept. 15.

The redemption price is par plus approximately 61 cents.

"They did their add-on deal a couple of weeks ago, so I'm not surprised that they're active," a trader said.

There were no new issues to report, he said.

JPMorgan issue active

JPMorgan Chase & Co.'s 8.625% series J noncumulative preferreds (NYSE: JPMPI) also were busy on Friday, following the late-Thursday news related to a redemption of all $1.8 billion of the preferred shares.

The preferreds were quoted Friday morning at $25.00, up a penny from Thursday's close.

The call will take place Sept. 3.

Barclays Bank trades higher

Also active on Friday morning was paper from Barclays Bank plc. The foreign bank's 8.125% noncumulative callable dollar preference shares (NYSE: BCSP) were trading up 8 cents at $25.56 early in the session.

Later in the day, the Barclays issue moved up 6 cents to $25.62. The issue finished the session at $25.69.

And HSBC Holdings plc's 8.125% exchangeable perpetual subordinated capital securities (NYSE: HCSPB) dropped 7 cents on Friday afternoon to $25.68.

Morgan Stanley moves up

Toward the end of the session, Morgan Stanley Capital Trust VII's 6.6% fixed capital securities (NYSE: MSZ) were busy, trading at $24.48, up 7 cents.

And Merrill Lynch Capital Trust I's 6.45% Trust Preferred Securities (NYSE: MERPRK) moved up 4 cents to trade at $24.70.

Otherwise, there weren't any huge moves in the space on Friday, a trader said.

"There's not one particular issue in the preferreds world that is being affected by all the Treasury moves," he said. "There's not much going on this week."

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