Our site runs on donations to keep it running for free. Please consider donating if you enjoy your experience here!

Monday Morning Kickoff

Last week was a relatively quiet week in markets–the S&P500 moved in a range of 3907 to 4208–closing at 3965 which is a modest loss of less than 1% from the previous Friday close.

The 10 year treasury yield ended up at 3.82% on Friday which was less than a basis point higher than the previous Friday. The yield traded in a range of 3.69% to 3.90%. Rates were held in check by the very soft producer price index which was released last Tuesday–coming in at 1/2 the expected level. This week we have no real economic releases on Monday and Tuesday, but numerous releases on Wednesday–durable goods, jobless claims, consumer sentiment and some other minor items. Then we have a holiday and the end of the week with no releases scheduled–all in all a quiet week.

The Federal Reserve balance sheet continued to be reduced with a $53 billion reduction week—after a $2 billion increase the previous week. At $8.625 trillion we have a very long ways to go.

Trading in preferred stock and baby bonds last week was relatively quiet–just the way I like it. The average $25 share was off 9 cents on the week. Investment grade issues rose 3 cents, banking issues were off 4 cents, mREIT issues were down 3 cents.

Last week we had 1 new income issue priced by Lincoln National Corp. (LNC). The perpetual preferred was priced at 9% after poor quarterly earnings hindered more favorable pricing. The issue is investment grade.

The issue is now trading at $26.69 on the OTC grey market under ticker LNCDL for a current yield of 8.4% with a yield to 1st call date of just under 8%. Disclosure–I bought a small amount last week and may add again today.

This image has an empty alt attribute; its file name is lnc-2.jpeg

4 thoughts on “Monday Morning Kickoff”

  1. Good morning and thank you for the LNC info last week. I purchased at 26.09.

    Has anyone looked at the DS/B,C,D Preferrds today with DS eps report this morning? Pretty big rally. Just wondering if anyone has an opinion and think any of these preferreds might be worth a small spec long

    Thank you

    1. sjc,
      I would look for information on the net or on SA. I read somewhere they are thinking about a reverse stock split. This is a 44 cent common below a buck. Depending on the exchange its listed on, They have to keep share price at a 1.00 min. to keep from being de-listed.
      I could be wrong, I don’t know this for sure. But reverse stock splits never work out for the investor. Been there, done that.

  2. With the yield curve telling us a recession is coming we have not seen credit spreads widen much. That usually occurs during recessions and I think it happens next year. The fed doesn’t usually stop hiking until multiple things are breaking. Hopefully we don’t get a liquidity crisis this time. ATB and Happy Thanksgiving everyone. I do my best to remain humble and thankful everyday.

Leave a Reply

Your email address will not be published. Required fields are marked *