Preferred stock market ends off on day; U.S. issuers dominate trading; Qwest to list Tuesday

By Andrea Heisinger

New York, June 25 - The preferred stock market had been reasonably busy last week but saw little activity on Monday, sources said.

There were no new issues announced, although one trader said he'd heard rumors of at least one upcoming deal.

"It's deader than dead today," the trader said.

The new 7% notes due 2052 sold by Qwest Corp. are set to be listed on the New York Stock Exchange on Tuesday.

Trading was on the light side, which is par for the course on a Monday, a secondary source said.

"There's absolutely nothing moving around," he said.

A trader said early in the day that the top seven or eight most-active issues in the secondary were from names including Bank of America Corp., which was No. 1, and a 6.125% series P sale done in April by PNC Financial Services Group, Inc.

"We're clearly off on the day, about 10 basis points, or 2 to 3 cents," the trader said. The levels were compared to Friday's close, he added.

The market remained on the same track throughout the day, ending off between 10 bps and 11 bps, the trader said after the close.

"There are the same patterns, a little more volume," he said.

Banco Santander SA's series E preferred shares were seeing the most trading among European financial names, but they were still eighth on the list of most actives.

Of the top 15 issues seen active in trading, nearly all were flat or up on the day.

"It's a Monday, and right now it feels like August," the source said, referring to the summer slowdown.

"The only reason volume is so high is because of all of the calls."

The U.S. Department of the Treasury announced that it will sell preferred stock bought from seven banks through the Capital Purchase Program as part of its effort to wind down the Troubled Asset Relief Program.

They will be sold through Dutch auctions that began Monday.

Domestic names most active

Turmoil in the euro zone didn't equate to an increase in trading in preferred shares from banks based there, traders said on Monday.

Instead, the most actively traded shares came from U.S. issuers.

Investors traded 1.22 million of Bank of America's series B preferreds, which ended up 93 cents on the day at $25.44, a secondary source said.

"That was likely due to those calls on Friday," he said.

Series B preferreds from Countrywide Capital were the second most active on the day. "People are speculating they could call it out of the market," the source said. There were 562,000 preferreds traded, and they ended up 39 cents on the day at $24.70.

Investors traded 424,000 of PNC's series P preferreds, which ended up 8 cents on the day at $26.02.

Series A preferreds from Ally Financial Inc. saw 365,000 shares trade, and they ended off 5 cents on the day at $23.95, a trader said.

Qwest to list Tuesday

The newest issue of 7% notes due 2052 from Qwest is expected to list on the NYSE on Tuesday, a trader said early Monday afternoon.

The ticker symbol is "CTU."

Qwest priced the $400 million issue on June 14. Proceeds from the sale will be used to take out the previously issued 7% notes due 2052 (NYSE: CTX).

Qwest is a Monroe, La.-based telecommunications provider.

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