Approaching hurricane thins liquidity of preferreds; Bank of America ends somewhat weaker

By Stephanie N. Rotondo

Portland, Ore., Aug. 26 - The preferred stock market "finished for the most part in the green," a trader said Friday.

Still, he noted that there was "pretty thin liquidity," possibly due in part to the approaching hurricane as well as the fact that it was Friday.

"Our stuff is kind of finding its way back to these normal levels, or to levels where they should be," said another trader.

He also remarked that many desks had been vacated as East Coasters prepared for the arrival of Hurricane Irene.

Bank of America Corp., however, continued to be the driving force of the market. Shortly before the close, the preferreds had been "pushed up a little bit," a trader said. By the end of business, however, the preferreds were "marginally down," another trader said.

Meanwhile, a trader said foreign issuers such as ING Groep NV were gaining ground, though he wasn't sure why.

BofA slips modestly

A trader said Bank of America's preferreds - specifically the 8.2% series H depositary shares (NYSE: BACPH) and the Merrill Lynch 8.625% series Q depositary shares (NYSE: BMLPQ) - were "marginally down," though he noted that the closing levels might not be accurate.

"It was probably more along the lines of declining liquidity at the end of the day," he said. Sometimes late prints from smaller shops can look like the price is dropping when it really isn't, he explained.

"I would say they were probably unchanged to marginally up," he said.

The Hs were the most actively traded issue of the day, as volume came in over 1.3 million shares. They slipped a penny to $23.87 after being in the green for most of the day.

The Qs meantime fell 7 cents to $24.38 on volume of about 610,000 shares.

Earlier in the day, a trader said that the preferreds were mainly better and opined that news that the mortgage case involving Bank of America and several other banks might be moved to federal court might have helped.

"It could move this along faster," he said. "It could help once liability levels [are established]."

ING gains

Among foreign issuers, ING Groep was gaining ground, though on no particular news.

The 7.375% perpetual hybrid capital securities (NYSE: IDG) moved up 74 cents, or 3.54%, to $21.63. The 8.5% perpetual hybrid capital securities (NYSE: IGK) rose 63 cents, or 2.62%, to $24.70.

ING is an Amsterdam-based financial institution.

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