Morning Commentary: Preferreds, financials post early gains; Ready Capital edges up

By Cristal Cody

Tupelo, Miss., July 18 – Preferred stocks saw gains in early trading on Thursday.

The Wells Fargo Hybrid and Preferred Securities index rose 0.35% at the start of the session after ending Wednesday up 0.34%.

The U.S. iShares Preferred Stock ETF moved up 3 cents, or 0.08%, to $37.18 after closing up 13 cents in the previous session.

Meanwhile, a deal from Ready Capital Corp. of $25-par seven-year senior notes is being offered in the primary market.

Sandler O’Neill + Partners, LP and B. Riley FBR, Inc. are the bookrunners.

Ready Capital’s existing 6.5% senior notes due April 30, 2021 (NYSE: RCP) opened the day 2 cents higher, or 0.09%, to $25.75 on about 2,300 notes traded. The notes went out on Wednesday up 19 cents, or 0.74% on about 4,000 notes traded.

Bank and financial preferred stocks are trading mostly better on the heels of second-quarter earnings reports.

Morgan Stanley’s preferred stocks traded higher after the company reported better-than-expected earnings results before the market opened on Thursday.

The series A preferreds (NYSE: MSPrA) were up 14 cents, or 0.66%, to $21.31 on volume of about 87,000 shares.

The company’s series E preferreds (NYSE: MSPrE) rose 8 cents, or 0.28%, in early trading to $28.55 on volume of about 52,000 shares.

In other sector trading, Bank of America Corp.’s preferreds traded flat to 5 cents better over the morning following’s the company’s second-quarter report on Wednesday.

Bank of America’s 5.875% series HH non-cumulative preferred shares (NYSE: BACPrK) opened 2 cents, or 0.06%, better at $26.43 on about 69,000 shares traded.

The series HH preferred shares rose 8 cents on Wednesday.

U.S. Bancorp’s preferred shares traded about 2 cents to 7 cents higher over the morning after the company posted stronger earnings results on Wednesday.

U.S. Bancorp’s 5.5% series K non-cumulative perpetual preferred stock (NYSE: USBPrP) rose 7 cents, or 0.27%, to $26.30 in early trading on about 42,000 shares traded.

The preferreds declined 2 cents, or 0.08%, on Wednesday.

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