Nearly all of The Bond Buyer’s weekly yield indexes declined this week amid a light new-issue calendar and somewhat lackadaisical interest in the secondary.
“The week seems to, in total, be running in place, in terms of overall yield levels,” said Michael Pietronico, chief executive officer of Miller Tabak Asset Management. “There’s generally a sense that credit spreads have been tightening.”
“This market seems to need more supply,” he said. “Specifically, it needs spread-product type supply. There hasn’t been much interest, but there’d be better interest if there were more A-rated paper available.”
The new-issue calendar was somewhat light this week. The largest deal priced was a $383.4 million competitive offering from Wake County, N.C. The issue was priced yesterday, just one day after it was postponed.
The offering, originally set for Wednesday, was postponed indefinitely on Tuesday after rating downgrades of Greece and Portugal caused a Treasury rally that eliminated potential savings. With Treasury yields drifting back to early-week levels on Wednesday, Wake County opted to enter the market yesterday.
The Bond Buyer 20-bond index of 20-year general obligation bond yields was unchanged this week at 4.37%. Last week the index reached its lowest level since March 18, when it was 4.32%.
The 11-bond index of higher-grade 20-year GO yields declined two basis points this week to 4.08%. It is now at its lowest level since March 18, when it was 4.05%.
The revenue bond index, which measures 30-year revenue bond yields, dropped two basis points this week to 4.91%. It is now at its lowest point since Jan. 21, when it was also 4.91%.
The Bond Buyer one-year note index, which is based on one-year tax-exempt note yields, declined three basis points this week to 0.51%, but it remained above its 0.48% level from two weeks ago.
The yield on the 10-year Treasury note declined five basis points this week to 3.74%, which is the lowest it has been since March 18, when it was 3.67%.
The yield on the 30-year Treasury bond fell five basis points this week to 4.60%. It is the lowest yield for the long bond since March 18, when it was 4.59%.
The weekly average yield to maturity on The Bond Buyer’s 40-bond municipal bond index, which is based on 40 long-term municipal bond prices, finished at 5.13%, down three basis points from last week’s 5.16%.
