Preferred stocks finish firm; Escalera falls as company halts dividend; banks improve

By Stephanie N. Rotondo

Phoenix, March 10 – Preferred stocks were ticking up Tuesday as long Treasuries improved due to a strong dollar, according to a trader.

The Wells Fargo Hybrid and Preferred Securities index ended up 25 basis points. The index was up 10 bps at mid-morning.

However, while a market source said that it was “a better day than yesterday” in terms of price moves, “volume was pretty feeble.”

A trader also noted that oil was weakening. That, combined with news that Escalera Resources Co. had suspended its dividend, was pressuring other oil names.

Escalera’s 9.25% series A cumulative preferreds (Nasdaq: ESCRP) closed down $9.47, or 53.59%, at $8.20.

That was up from the intraday low of $8.01.

“People are selling off other issues in fear” they may follow suit, the trader said.

Breitburn Energy Partners LP’s 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP) were off $1.28, or 5.77%, at $20.90. Vanguard Natural Resources LLC’s 7.625% series B cumulative redeemable preferred units (Nasdaq: VNRBP) dipped $1.17, or 5.1%, to $21.78.

Meanwhile, JPMorgan Chase & Co.’s 6.125% series Y noncumulative preferreds (NYSE: JPMPF) inched up 6 cents to $24.98, while the 6.7% series CC capital securities (NYSE: JPMPC) ended up a penny at $25.41.

Elsewhere in the banking space, Bank of America Corp.’s 6.5% series Y noncumulative preferreds (NYSE: BACPY) rose 4 cents to $25.19.

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