The municipal market was firmer by yesterday, following Treasuries. Traders said tax-exempt yields were lower by three or four basis points.
"There wasn't much going on early, but it turned around," a trader in New York said. "We ended up seeing pretty decent activity out there, and we saw some gains. Overall, it was a pretty positive day. We saw some more activity later on, when stocks kind of fell off, and Treasuries increased their gains. But we had been in positive territory all day, so we just kept on keeping on, so to speak."
Trades reported by the Municipal Securities Rulemaking Board yesterday showed gains. A dealer sold to a customer California 5.125s of 2036 at 5.76%, down three basis points from where they traded Tuesday. A dealer sold to a customer Virginia 4.5s of 2026 at 5.00%, three basis points lower than where they traded Tuesday. A dealer sold to a customer Pennsylvania 4.5s of 2026 at 5.15%, two basis points lower than where they were sold Tuesday. A dealer sold to a customer insured Tennessee Housing Development Agency 4.15s of 2033 at 4.86%, down three basis points from where they were sold Tuesday. Bonds from an interdealer trade of New York's Metropolitan Transportation Authority 5.125s of 2029 yielded 5.84%, two basis points lower than where they traded Tuesday.
"There was some more demand out long, where you were seeing stuff even five or six basis points better in spots," a trader in Los Angeles said. "But for the most part, there were gains, but nothing too substantial. Just another positive day. Activity wise, we were probably busier than we've been earlier in the week, but that's not saying all that much."
The Treasury market showed mild gains yesterday. The yield on the benchmark 10-year Treasury note, which opened at 3.72%, finished at 3.67%. The yield on the two-year note was quoted near the end of the session at 1.35%, after opening at 1.38%. And the yield on the 30-year bond, which opened at 4.19%, was quoted near the end of the session at 4.14%.
In the new-issue market yesterday, JPMorgan priced for retail investors $356.6 million of assessment bonds for the Massachusetts Bay Transportation Authority. The bonds mature from 2013 through 2028, with term bonds in 2032 and 2034. Yields range from 3.44% with a 4% coupon in 2013 to 5.35% with a 5.25% coupon in 2034. Bonds maturing in 2032 were not offered during the retail order period. The bonds, which are callable at par in 2018, are rated Aa1 by Moody's Investors Service and AAA by Standard & Poor's.
JPMorgan priced $215.8 million of Catholic Health Initiatives revenue bonds issued through the Colorado Health Facilities Authority. The bonds mature from 2014 through 2018, with term bonds in 2023, 2028, and 2033. Yields range from 4.82% with a 5% coupon in 2014 to 6.50% with a 6.25% coupon in 2033. The bonds are callable at par in 2018, and are rated Aa2 by Moody's and AA by both Standard & Poor's and Fitch Ratings.
Also, JPMorgan priced $169.6 million of Catholic Health Initiatives revenue bonds through the Washington Health Care Facilities Authority. The bonds mature from 2016 through 2018, with term bonds in 2023, 2028, 2033, and 2036. Yields range from 5.23% with a 5.125% coupon in 2016 to 6.64% with a 6.375% coupon in 2036. The bonds, which are callable at par in 2018, are rated Aa2 by Moody's and AA by both Standard & Poor's and Fitch.
And, JPMorgan also priced a $24.5 million revenue bond Catholic Health Initiatives issue, through Tennessee's Chattanooga Health Education and Housing Board. The bonds mature from 2014 through 2018, with term bonds in 2023, 2038, and 2033. Yields range from 4.82% with a 5% coupon in 2014 to 6.50% with a 6.25% coupon in 2033. The bonds are callable at par in 2018, and are rated Aa2 by Moody's and AA by both Standard & Poor's and Fitch.
Loop Capital Markets priced $97.1 million of public improvement revenue bonds for Palm Beach County, Fla. The bonds mature from 2009 through 2025, with a term bond in 2028. Yields range from 1.85% with a 4% coupon in 2009 top 5.45% with a 5.375% coupon in 2028. The bonds, which are callable at par in 2018, are rated Aa1 by Moody's and AA-plus by both Standard & Poor's and Fitch.
JPMorgan priced $83.3 million of revenue bonds for the Massachusetts Health and Education Facilities Authority. The bonds mature from 2009 through 2023, with term bonds in 2025 and 2038. Yields range from 2.60% with a 5% coupon in 2010 to 5.51% with a 5.375% coupon in 2038. Bonds maturing in 2009 were decided via sealed bid. The bonds, which are callable at par in 2018, are rated Aa2 by Moody's and AA-minus by Standard & Poor's.
The Bond Buyer's one-year note index came in at 1.70% yesterday, which is down 30 basis points on the week and nearly 1 full percentage point from 2.69% on Oct. 15.
In economic data released yesterday, the Institute for Supply Management's non-manufacturing business activity composite index was 44.4 in October, down from 50.2 in September, on a seasonally adjusted basis. Economists polled by Thomson Reuters had expected a 47.5 level.
