The municipal market was unchanged with a slightly firmer tone Thursday, in quiet trading, as participants remained largely on the sidelines ahead of the July 4 holiday weekend."There's a firmer tone, but there's really not a whole lot going on," a trader in New York said.
"People are just ready for the long weekend. I am not seeing a lot of trading out there, just not a lot of activity. It seems like people are on the sidelines for the most part, unless they're really compelled to move some paper. I'd call it flat for the most part, but like I said, there is a bit of a better tone, and maybe you can pick up a basis point in spots. But overall, pretty flat, pretty quiet."
"We're just winding down," a trader in Los Angeles said. "Just a fairly quiet session, not a lot of movement. It's pretty unchanged on the whole, maybe a touch firmer in spots."
Trades reported by the Municipal Securities Rulemaking Board showed some gains Thursday.
A dealer bought from a customer taxable Illinois 5.1s of 2033 at 6.02%, down one basis point from where they traded Wednesday.
A dealer sold to a customer California 4.875s of 2033 at 6.22%, down one basis point from where they were sold Wednesday.
Bonds from an interdealer trade of Puerto Rico Sales Tax Financing Corp. 5.5s of 2028 yielded 5.61%, even with where they traded Wednesday.
The Treasury market showed some gains Thursday. The yield on the benchmark 10-year note, which opened at 3.54%, was quoted near the end of the session at 3.50%.
The yield on the two-year note was quoted near the end of the session at 1.00% after opening at 1.04%. The yield on the 30-year bond, which opened at 4.33%, was quoted near the end of the session at 4.32%.
As of Wednesday's close, the triple-A muni scale in 10 years was at 90.4% of comparable Treasuries, according to Municipal Market Data.
Additionally, 30-year munis were 107.1% of comparable Treasuries. Also, as of the close, 30-year tax-exempt triple-A general obligation bonds were at 111.8% of the comparable London Interbank Offered Rate.
In economic data released Thursday, non-farm payrolls fell 467,000 in June after a revised 322,000 drop in May. Economists polled by Thomson Reuters had predicted a loss 363,000 jobs.
The unemployment rate rose to 9.5% in June, its highest rate since August 1983, after a 9.4% reading the previous month. Economists polled by Thomson had predicted a 9.6% unemployment rate.
Initial jobless claims for the week ended June 27 fell 16,000 to 614,000 after a revised 630,000 the previous week. Economists polled by Thomson had predicted 615,000 initial claims.
Continuing jobless claims fell 53,000 to 6.702 million. Economists polled by Thomson Reuters had predicted 6.740 million continuing claims.
New factory orders for manufactured goods climbed 1.2% in May. The factory order increase to $347.9 billion was larger than the 0.8% increase projected by Thomson and came after a revised 0.5% increase to $343.8 billion in April.
Activity in the new-issue market was light Thursday.
