Morning Commentary: Preferreds aim for higher finish; SCE Trust, PennyMac on the rise

By Stephanie N. Rotondo

Seattle, July 7 – Preferred stocks were looking to regain ground in early Friday dealings, following the rest of the markets upward on the back of a better-than-expected jobs numbers.

Both the Wells Fargo Hybrid and Preferred Securities Index and the U.S. iShares Preferred Stock ETF were up 4 basis points at mid-morning.

In its latest monthly report, the Bureau of Labor Statistics said that 222,000 jobs were added in June. That beat market expectations of a 180,000-jobs increase.

However, the unemployment rate was slightly higher at 4.4% – versus 4.3% in May – and wage growth continued to be less than stellar at 2.5% for the year.

As for preferred dealings, the trend of limited liquidity was continuing. Still, what was trading was trading better.

For instance, Southern California Edison Co.’s 5% cumulative trust preference securities issued via SCE Trust IV (NYSE: SCEPrL) were up 3 cents at $24.99 while PennyMac Mortgage Investment Trust’s 8% series B fixed-to-floating rate cumulative redeemable preferred stock (NYSE: PMTPrB) were up a nickel at $24.94.

NextEra Energy Inc.’s 5.25% $25-par series K junior subordinated debentures due 2076 (NYSE: NEEPrK) were meantime 10 cents better at $25.53.

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