Morning Commentary: Preferreds begin week modestly higher; new deal could be on the horizon

By Stephanie N. Rotondo

Phoenix, July 28 – Preferred stocks were slightly firm Monday as the week got started.

The Wells Fargo Hybrid and Preferred Securities index was up 3 basis points at mid-morning.

A trader said he was “hearing a possible deal this week,” though he did not have a specific name. He also suggested that the rumor “could just be hearsay,” especially given the pipeline’s recently stemmed flow.

In secondary trading, liquidity overall was on the muted side as the first trading session of the week kicked off.

Verizon Communications Inc.’s 5.9% $25-par notes due 2054 (NYSE: VZA) and Wells Fargo & Co.’s 6% series T class A noncumulative preferreds (NYSE: WFCPT) were actively trading but were moving toward the downside, bucking the trend of the broader market.

The Verizon notes were down about 5 cents at mid-morning, trading at $26.10. The Wells Fargo preferreds were off 4 cents at $24.81.

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