Preferreds firm as week begins; Pennsylvania REIT, National Retail in play; GSEs gyrate

By Stephanie N. Rotondo

Seattle, Jan. 23 – Preferred stocks were better on Monday, though a trader noted that overall activity was initially muted.

“Everyone is still trying to figure it all out,” a market source said. Investors are looking to the new Trump administration for clues as to how things like taxes and regulations will be handled, but so far, very little information has emerged.

The Wells Fargo Hybrid and Preferred Securities index closed the day up 73 basis points. A source said the gains came “slow and steady” until around 2:20 p.m. ET, when the index jumped sharply.

As for recent new issues, Pennsylvania Real Estate Investment Trust’s $150 million offering of 7.2% series C cumulative redeemable preferreds finished at $24.96, a gain of 4 cents on the day.

“They have been trading right around that level,” a trader said.

The deal came Wednesday, upsized from $75 million and tight to the 7.375% area price talk.

The issue is trading under a temporary symbol, “PNYLP.”

In the secondary, National Retail Properties Inc.’s 6.625% series D cumulative redeemable preferreds (NYSE: NNNPrD) were busy but unchanged at $25.27.

The 5.2% series F cumulative redeemable preferreds (NYSE: NNNPrF) improved 22 cents, or 1%, to $22.21.

Meanwhile, GSE-linked preferreds were on the active side in an otherwise subdued day. The issues were initially weakening after rebounding Friday from Thursday’s lows, but eventually closed the session on higher ground.

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