Preferred stocks move with equities; CHS brings upsized new deal; bank earnings on tap

By Stephanie N. Rotondo

Phoenix, Jan. 13 – Preferred stocks ended about flat Tuesday after ticking up early, following the trend set by the common equity markets.

But as the equity markets swung into the red, the preferred space began to give up ground as well.

“The market was up a bit in the morning, down in the afternoon, but recovering” in the last hour, “heading for a flat close,” a market source said.

The Wells Fargo Hybrid and Preferred Securities index closed down 1 basis point. It was up 6 bps at mid-morning.

By comparison, the Dow Jones industrial average was up over 240 points at mid-morning but closed off just over 27 points.

The primary space saw its first deal of the year hit the tape with CHS Inc.’s sale of $450 million of 7.5% class B series 4 cumulative redeemable preferreds.

Price talk was 7.5% to 7.625%, according to a trader. The issue was upsized from $250 million.

The non-rated deal came via BofA Merrill Lynch and Wells Fargo Securities LLC.

The trader saw a $24.90 bid, par offered gray market early in the day.

Meanwhile, JPMorgan Chase & Co. and Wells Fargo & Co. will kick off bank earnings season on Wednesday.

Ahead of releases, JPMorgan’s preferreds were trending mostly higher, while Wells Fargo’s issues were mixed, but mostly to the downside.

© 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.