The tax-exempt market got off to a much busier start Friday morning than a typical week as many deals that had been postponed earlier in the week began to price.
Friday was the third full day the bond market was open after a full close Tuesday and an early close Monday.
In the primary market Friday morning, Bank of America Merrill Lynch held preliminary pricing for $169.6 million of Massachusetts Development Finance Agency revenue bonds for the Covanta Energy Project, rated Ba2 by Moody's Investors Service, BB-minus by Standard & Poor's, and BB-plus by Fitch Ratings.
The first series, $20 million of resource recovery revenue bonds subject to the alternative minimum tax, were priced to yield 0.80% with a 4.875% coupon in 2027. The bonds are callable at par in 2017.
The second series, $67.2 million of resource recovery refunding revenues bonds, were priced to yield 0.80% with a 5% coupon in 2042. The bonds are callable at par in 2017.
The third series, $82.4 million of resource recovery refunding revenue bonds subject to the alternative minimum tax, were priced to yield 0.80% with a 5.375% coupon in 2042. The bonds are callable at par in 2017.
Bank of America Merrill Lynch also priced $165 million of Niagara Area Development Corp. solid waste disposal facility refunding revenue bonds for the Covanta Energy Project, rated Ba2 by Moody's, BB-minus by Standard & Poor's, and BB-plus by Fitch.
The first series of $130 million of bonds subject to the alternative minimum tax were priced to yield 0.80% with a 5.375% coupon in 2042. The bonds are callable at par in 2017.
The second series of $35 million were priced to yield 0.80% with a 4.125% coupon in 2024. The bonds are callable at par in 2017.
On Thursday, the Municipal Market Data scale ended steady. The 10-year muni yield and the 30-year yield were flat at 1.72% and 2.82%, respectively, for the third session. The two-year remained at 0.30% for the 26th straight trading session.
Treasuries were weaker on better than expected economic data. The benchmark 10-year yield increased two basis points to 1.74% while the 30-year yield jumped four basis points to 2.93%. The two-year was steady at 0.28%.
In economic news, non-farm payrolls jumped 171,000 in October while the jobless rate ticked up to 7.9%.
"The economic data for October continue to be relatively upbeat as the gain in payrolls and the upward revision to employment growth in the prior two months put the level of payrolls in October some 255,000 above the previously reported level for September," wrote economists at RDQ Economics. "The employment gains in the household survey are implausibly high and we still expect to see an eight-handle on the unemployment rate again before the end of the year."
