The municipal market was firmer Friday in mostly light trading.
"There's not much activity, but there's definitely firmness in the market," a trader in New York said. "We're better by at least two or three basis points, and it's more like four or five if you go out long."
Trades reported by the Municipal Securities Rulemaking Board Friday showed gains. A dealer sold to a customer insured Massachusetts School Building Authority 5s of 2030 at 4.60%, down three basis points from where they were sold Thursday. Bonds from an interdealer trade of New York State Environmental Facilities Corp. 5s of 2037 yielded 4.73%, down three basis points from where they traded Thursday. Bonds from an interdealer trade of Oregon 5s of 2036 yielded 4.67%, four basis points lower than where they were sold Thursday. Bonds from an interdealer trade of Arizona Department of Transportation 5s of 2030 yielded 4.53%, down five basis points from where they traded Thursday.
"There was definitely more pronounced firmness on the long end of the muni market," a trader in Los Angeles said. "But there was firmness throughout the curve. We definitely ended up a bit better, at least three basis points."
The Treasury market showed some gains Friday. The yield on the benchmark 10-year Treasury note, which opened at 3.78%, was recently quoted at 3.77%. The yield on the two-year note was quoted recently at 2.22% after opening at the same level.
The economic calendar was light Friday. However, a slate of economic data will be released this seek.
Import prices for April will be released tomorrow, in addition to retail sales for April, March business inventories, and March business sales. On Wednesday, the consumer price index for April, along with the CPI core, are due. This will be followed Thursday by May's Empire State manufacturing index, initial jobless claims for the week ended May 10, continuing jobless claims for the week ended May 3, April industrial production, and April capacity utilization. On Friday, April housing starts and April building permits will be released, alongside the preliminary May University of Michigan consumer sentiment index.
Economists polled by IFR Markets are predicting a 1.7% rise in import prices, a 0.1% dip in retail sales, a 0.3% gain in retail sales excluding autos, a 0.5% uptick in business inventories, a 1.0% increase in business sales, 0.3% growth in CPI, a 0.2% rise to the CPI core, a 0.00 level for the Empire State Manufacturing index, 370,000 initial jobless claims, 3.035 million continuing jobless claims, a 0.3% decline in industrial production, 80.1% capacity utilization, 940,000 housing starts, 915,000 building permits, and a 62.5 level for the Michigan sentiment index.
Activity in the new-issue market was light Friday.
