Public Storage new deal deemed 'phenomenal,' stock at par; Ally, European banks higher

By Stephanie N. Rotondo

Portland, Ore., July 22 - Preferred stocks were still strong Friday, but traders were lamenting a lack of volume.

"It's the same story as [Thursday], just not as much movement," a trader said.

One trader also said that the U.S. debt ceiling debacle - Friday was the deadline imposed by president Barack Obama for a deal to be inked - seemed to be a non-event, as the preferred arena stayed strong.

Public Storage's recent 6.35% series R cumulative preferreds continued to "do phenomenal," a trader said. He added that the company had also sold off the deal's over-allotment option.

In financials, Ally Financial Inc., as well as European banks like Royal Bank of Scotland Group plc, remained on an upward path as "Europe is in a great place" and "Ally is just flying," a trader said.

Public Storage 'phenomenal'

Public Storage's recent new deal was "hanging" around par, a trader said.

"That seems to be where it's sticking," he said, adding that the paper was trading "maybe a nickel below or a nickel above here and there."

Another trader saw a 25 bid, "not much offered."

"The deal is doing phenomenal," the trader said. He also noted that the company had wrapped up its greenshoe.

The Glendale, Calif.-based real estate investment trust priced the deal late Tuesday. It's emergence into the market sparked quite a bit of excitement, as it was the first new issue in the market in weeks. Additionally, Public Storage is a frequent issuer in the REIT space and one that is typically viewed favorably.

Ally improves

There was "a slightly firmer [tone] in some of the junkier names like Ally and the Europe banks," a trader said.

The 8.125% series B preferreds were the most active, with about 1.3 million shares changing hands. The shares (NYSE: ALLPB) gained 38 cents to close at $25.17.

The 8.5% series A preferreds (NYSE: ALLYPA) gained 26 cents to $26.02.

Among European banks, Royal Bank of Scotland's series G preferreds (NYSE: RBSPG) moved up 17 cents to $13.71. The series Es (NYSE: RBSPE) meantime earned 18 cents to end at $13.69.

But while most European banks were better, not all of them followed that trend.

Barclays plc, for example, saw its series A preferreds (NYSE: BCSPA) drop 4 cents to $24.43.

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