Morning Commentary: Market rises as Yellen testifies before Senate; energy names improve

By Stephanie N. Rotondo

Phoenix, Feb. 24 – Preferred stocks were again moving higher early Tuesday as Janet Yellen, the chairman of the Federal Reserve, told a Senate committee that the central bank was looking to be more flexible on its looming interest rate increase.

The Wells Fargo Hybrid and Preferred Securities index was up 15 basis points at mid-morning.

The Fed will firstly drop the use of the word “patient,” a term used since December when the agency said it would take its time to raise rates.

Secondly, the Fed will adopt a “meeting-by-meeting” approach to the rate raise.

But while the market was firm, activity still remained subdued.

“Hopefully after we get past this testimony and stress tests,” activity in both the primary and secondary will pick up, a trader said.

In early trading, a trader said that “energy was moving up slowly,” as oil prices rallied.

He noted that West Texas Intermediate crude had “touched $50” earlier in the session.

Breitburn Energy Partners LP’s 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP) were up 16 cents at $22.95, while Vanguard Natural Resources LLC’s 7.625% series B cumulative redeemable preferred units (Nasdaq: VNRBP) were 11 cents higher at $22.41.

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