Citigroup rises as profit beats estimates; Goldman preferreds up; Webster Financial pops

By Stephanie N. Rotondo

Phoenix, July 16 – The preferred stock market surged Thursday in what one market source called “post-Greece euphoria.”

“It seems like Greece is fixed and it seems like China is back on the right path,” a trader said, adding that given the state of things, “seems like we’ll definitely see a rate hike in September.”

The Wells Fargo Hybrid and Preferred Securities index finished 42 basis points higher. It was up 22 bps at mid-morning.

Trading volume was also improving, according to a source.

“It was probably the best liquidity we’ve had in weeks,” he said. “But it wasn’t gangbusters either.”

Meanwhile, “banks had great earnings,” a trader said. “So those preferreds are holding their own.”

Citigroup Inc. released its numbers on Thursday, as did Goldman Sachs Group Inc. For its part, Citi posted its highest earnings in eight years, boosted by cost-cutting and restructuring efforts and declining legal costs.

Goldman meantime saw its profit plunge 52%.

Though not a “big bank,” Webster Financial Corp. was another financial institution that came out with numbers on Thursday.

The Waterbury, Conn.-based bank saw a record profit, giving its 6.4% series E noncumulative perpetual preferreds (NYSE: WBSPE) a boost.

The preferreds rose 28 cents to $25.34.

For the quarter, net income was $50.5 million, or 55 cents per share. In the previous year, net income was $45.2 million, or 50 cents per share.

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