Yesterday turned out to be pretty calm–the S&P500 moved up again, but just by 1/4%. Interest rates moved nicely lower – down about 8 basis points. There has been little economic news released this week. We did have plenty of Fed yakkers yesterday and will have again today–seems like they are in lock step for a change – none have tossed any bombs.
I did not buy any think yesterday – it helped that I had to be out of the office all afternoon, BUT I did enter a good until canceled order down at $24.25 for RiverNorth Capital and Income 5.875% Term Preferred (RMPL-P). Yes this is the issue I just sold at $24.98–but it went ex-dividend–trading as low as $24.60. If someone wants to give me a gift, I would take it. The issue has a mandatory redemption in less than a year – I want 8% YTM on a buy.
Also I reviewed many other potential buys – including shipping issues. The shippers have been ‘star’ performers in the last few years with their high yields. I have not bought a tanker or bulker company for many years–my question is have they seen their glory days and with a potential slowing economy are they headed for lower revenue and profits? One needs to scrutinize the balance sheets closely and understand the new build commitments of a company. Historically debt has been the bane of these companys – I don’t know – could take a nibble somewhere.
Lots and lots of earnings news last night – if you are skipping the couple minutes it takes to skim the headlines 4 nights a week (none of Friday) you are missing some good info – it’s nice to read a bit on earnings of company’s that are not generally something you would consider owning – stimulates consideration.
Well the futures markets are fairly calm – in both equities and bonds. The 10 year treasury is at 4.57%–calm. With only the yakkers on tap for today(except wholesale inventories) maybe we will simply have a market that flat lines – wouldn’t break my heart.
Schwab does not list RMPLpP ; they only show the common units RSV ?
put RMPL/PR
The common units are RSF, not RSV.
In StreetSmart Edge use RMPLp, on schwab.com use RMPL/PR.
I’m exiting bulk shipper preferred that are trading at par or higher. In a recession these will be hit for sure.
Regarding oil tankers, I’m still into preferred on these since the fate of oil is in question, even if a recession. It could be stagflation where oil continues to rise in price despite a reduction in demand given what happens in global supply and distribution.
That is my concern legend.vs–don’t want to buy them at the top–so the question is are we going to have a recession
I would suggest being very careful with shippers right now.
Maersk announced more layoffs (bringing recent totals up to 11%) and cutbacks. They are one of better run shippers (IMHO). They published an update letter when they announced the cutback – which I think I mentioned here, but can’t find at the moment.
Interview with Maersk exec said that shipping rates are plummeting to (and maybe below) pre-pandemic pricing and new ships are being launched as demand is falling quickly.
Agreed- I recently posted some info here that they were reporting- such as revenues down 90%, if I recall correctly.
Gary, you are correct. I think on Yahoo finance I read on the quarterly report revenue was down 90% on Maersk. LNG shipping that was bought out by Sea Peak and taken private by PE still reports financials and I think they had a loss but the parent co put more money in on some new ships. Unknown if they had pre booked contracts. Another I follow is FLNG was criticized for having too many ships locked into fixed contracts when spot rates were a lot higher. But now with spot rates falling seems to be good they did. But again same problem, they ordered new ships and how many have been locked into fixed contracts and the other older contracts will be expiring and up for renewal. Just saying, watch for storm clouds. As Private implied I don’t think these are long term holds.
On a similar note, read that FedEx is recommending that its pilots go work for regional airlines due to a decline in shipments.
And when there is demand at FedEx, they’ll be crying that it’s hard to find pilots, etc.- just like the airlines after covid layoffs & forced retirements.
Boo hoo.
Private–yes I saw a blurp on one of the Moodys reports on Maersk – not looking good.