Market ‘basically flat’ in trading; AmTrust’s recent 7.25% noncumulatives list on NYSE

By Stephanie N. Rotondo

Phoenix, July 7 – Preferred stocks were “basically flat all day,” a market source said after the close of the first post-holiday trading session.

The Wells Fargo Hybrid and Preferred Securities index closed down 2 basis points after being up 6 bps at mid-morning.

“The market is pretty flat across the board, slightly up,” a trader said, adding that he had expected at least a small sell-off after Thursday’s jobs number. But with the holiday, it seemed like the fresh data had little impact.

As for the new issue market, the trader said that he “wouldn’t be surprised if we see a couple deals this week or next week.”

However, no new deals were announced on Monday.

One market source noted that while overall volume was “not great,” it was “not nearly as bad as I was expecting.”

“The market has some things to think about,” he added. Interest rates, of course, were one, but upcoming bank earnings and a rebalance of the Standard & Poor’s U.S. Preferred Stock index was another.

“One of the biggest [preferred] ETFs uses that as a benchmark,” he said.

The S&P rebalance – which took place after the bell on Thursday – helped Capital One Financial Corp.’s 6.25% series C noncumulative perpetual preferred shares (NYSE: COFPC) – a $500 million issue that priced June 9 – trade actively, as the issue was added to the index.

The issue gained 7 cents, closing at $24.69, on over 932,000 shares traded.

Capital One’s 6% series B noncumulative perpetual preferreds (NYSE: COFPP) were meantime 8 cents higher at $24.13.

All in all, 18 issues were added to the index and seven were eliminated.

Wells Fargo & Co.’s 5.85% series Q fixed-to-floating rate noncumulative perpetual preferreds (NYSE: WFCPQ) were also busy, with over 711,500 shares being exchanged.

That issue fell 4 cents to $26.00.

Wells Fargo will kick off bank earnings season on Friday.

AmTrust lists on NYSE

In recent deals, AmTrust Financial Services Inc.’s $100 million of 7.25% series B noncumulative perpetual preferreds were admitted for trading on the New York Stock Exchange on Monday.

The issue priced June 25. The ticker symbol is “AFSIPB.”

The shares closed at $24.94, up from the intraday low of $24.80.

Paper was trading at $24.99 early in the day, versus opening levels of $24.89.

Morgan Stanley & Co. LLC, UBS Securities LLC, Goldman Sachs & Co. and J.P. Morgan Securities LLC were the joint bookrunners. Keefe Bruyette & Woods Inc. was the lead manager.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.