Midday Commentary: Preferreds firm after losses; Resource Capital’s new deal inches higher

By Stephanie N. Rotondo

Phoenix, June 5 – The preferred stock market looked to be edging higher in Thursday trading after several down sessions.

The Wells Fargo Hybrid and Preferred Securities Index was up 4 basis points as of mid-morning.

One trader said things “seem to have stabilized,” also noting that the market was “rather quiet considering all the news coming out of Europe.”

The European Central Bank announced a series of moves aimed at avoiding deflation, including an interest rate cut.

Resource Capital Corp.’s $110 million of 8.625% series C fixed-to-floating rate cumulative redeemable preferreds were mimicking the market, trading higher early in the session.

A trader saw the issue around $24.90. The paper had been in a $24.70 to $24.80 range on Wednesday.

The deal priced Tuesday and freed from the syndicate on Wednesday.

Meanwhile, Allstate Corp.’s offering of series F fixed rate noncumulative perpetual preferred stock via Incapital LLC’s Leopards program could price as soon as Thursday, a trader said.

On Wednesday, a market source told Prospect News that the offering had already closed, though the initial plan was to have the deal priced by June 9. As such, it was expected that pricing would be accelerated.

On Thursday, the trader indicated that price talk was holding in the 6.25% area.

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