The municipal market was unchanged to slightly firmer Friday.
"We saw some gains, but nothing major," a trader in Los Angeles said. "In fact, I'm not even sure it was enough to bump the scale. There was a firmer bias, for sure, but I still think we might be unchanged on the day. If not, it's a basis point or two better, at best."
Trades reported by the Municipal Securities Rulemaking Board Friday showed little movement. A dealer sold to a customer insured Knoxville, Tenn., 5s of 2037 at 5.06%, even with where they were sold Thursday. A dealer sold to a customer insured Phoenix 3s of 2028 at 5.10%, even with where they traded Thursday. A dealer sold to a customer insured Harris County, Tex., Health Facilities Development Authority 5.125s of 2037 at 5.30%, even with where they were sold Thursday.
The Treasury market showed gains Friday. The yield on the benchmark 10-year Treasury note, which opened at 3.53%, was recently quoted at 3.44%. The yield on the two-year note was quoted recently at 1.65% after opening at 1.69%.
"We're following Treasuries a bit, and we're probably a little bit firmer," a trader in New Jersey said. "I'm seeing us about a basis point or two better in some spots, but definitely a firmer tone."
In economic data released Friday, personal income rose 0.5% in February, after a 0.3% gain in January. Additionally, personal consumption rose 0.1% in February after a 0.4% uptick the prior month. Economists polled by IFR Markets had predicted a 0.3% gain in personal income and a 0.1% rise in personal consumption.
The core personal consumption expenditures deflator rose 2.0% in February after a revised 2.0% gain the previous month. Economists polled by IFR had predicted a 2.1% rise.
The University of Michigan's final March consumer sentiment index reading was 69.5 compared to the preliminary 70.5 reading. Economists polled by IFR had predicted a 70.0 reading.
This week, a slate of economic data will be released, with Friday's March nonfarm payrolls report at the forefront. In other day, the March Chicago purchasing managers' index will be released today, followed by February construction spending and the March Institute for Supply Management business activity composite index tomorrow. Factory orders for February will be released Wednesday, followed by initial jobless claims for the week ended March 29, continuing jobless claims for the week ended March 22, and the March ISM non-manufacturing index Thursday.
Economists polled by IFR are predicting that 50,000 jobs were lost in March. They are also forecasting a 46.0 reading for the Chicago PMI, a 48.0 reading for the ISM index, a 0.6% drop in factory orders, a 0.3% rise in factory orders excluding transportation, 366,000 initial jobless claims, 2.860 million continuing jobless claims, and a 49.0 reading for the ISM non-manufacturing index.
Activity in the new-issue market was light Friday. This week, however, a $1.2 billion offering of New York City variable-rate demand bonds and $617 million of debt for the New Jersey Economic Development Authority lead the way in the primary market this week. The deals head up a slate of $7.3 billion, up from the $5.4 billion of bonds that were priced in the new-issue market last week.
