Yemen bombings weigh on market; oil rally boosts energy preferreds; National General rises

By Stephanie N. Rotondo

Phoenix, March 26 – The preferred stock market was weak on Thursday following the trend of the broader markets as Saudi Arabia and its Arab allies launched a bombing campaign against Houthi rebels in Yemen.

The Wells Fargo Hybrid and Preferred Securities index ended off 10 basis points.

The military action resulted in a decent spike in oil prices. West Texas Intermediate crude rose 2.3% in early trades, moving above the $50 mark. At the close, the price increased even more, finishing up $2.09, or 4.25%, at $51.30 per barrel.

Brent crude meantime gained $2.57, or 4.55%, to $59.05.

As a result of the oil rally, most energy preferreds were “doing fine,” a trader said. Overall, however, the sector was mixed.

Goodrich Petroleum Corp.’s 9.75% series D cumulative preferreds (NYSE: GDPPD) ended up 13 cents, or 1.69%, to $7.81. But the 10% series C cumulative preferreds (NYSE: GDPPC) fell 22 cents, or 2.76%, to $7.76.

Vanguard Natural Resources LLC’s preferred units were similarly mixed. The 7.875% series A cumulative redeemable preferred units (Nasdaq: VNRAP) were initially up in early trades but closed off 25 cents, or 1.03%, at $23.96. The 7.625% series B cumulative redeemable preferred units (Nasdaq: VNRBP), however, started the day softer but finished up 2 cents to $22.16.

Meanwhile, a trader saw National General Holdings Corp.’s new 7.5% series B noncumulative preferreds were busy and better, putting on 3 cents to close at $24.84.

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