Preferreds lower after Fed minutes; bank earnings eyed; PS Business gets temporary ticker

By Stephanie N. Rotondo

Seattle, Oct. 12 – The preferred stock market continued to be weak on Wednesday as investors waited to see the minutes from the Federal Reserve’s most recent policy meeting.

The minutes indicated that the vote to keep rates steady for the time being was a “close call.” Members of the central bank appeared to have valid arguments both for increasing rates and for keeping the rates unchanged at 0.25% to 0.5%.

The minutes further indicated that a rate increase in December was highly likely.

The Wells Fargo Hybrid and Preferred Securities index finished down 51 basis points. It was off 14 bps at mid-morning, prior to the release of the minutes.

One market source opined that the weakness “could be positioning in front of bank earnings.”

Wells Fargo & Co., Citigroup Inc. and J.P. Morgan Chase & Co. are slated to kick-off bank earnings on Friday.

And speaking of Wells Fargo, the 6% series V class A noncumulative preferreds (NYSE: WFCPV) were inching higher, rising 15 cents to $26.11.

As for the week’s only new issue thus far, PS Business Parks Inc.’s $165 million of 5.2% series W cumulative preferreds were seen at $24.75 at the bell. However, a source said that level was “kind of on the high side,” seeing the volume weighted average price at $24.675.

A trader said the paper had already been assigned a temporary trading symbol, “PSBNL.”

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