Puerto Rico bonds opened steady Wednesday morning with light volume and few block size trades following an investor call Tuesday by the commonwealth seeking to reassure investors of its ability to pay its debt.
Traders said yields on the Sales Tax Financing Corp., or COFINA, bonds were flat in intraday trading. "There is light volume with some odd lots going cheaper relative to interdealer trades," a Chicago trader said. "There is not much in terms of sizeable blocks and those that are moving are just the flat interdealer trades."
Puerto Rico officials put to rest bankruptcy fears for the commonwealth and its agencies during the call Tuesday afternoon calling it "completely out of the question."
In the general market Wednesday, JPMorgan priced for retail the largest deal of the week, $955.9 million of Dormitory Authority of the State of New York sales tax revenue bonds, rated AAA by Standard & Poor's and AA by Fitch Ratings. Institutional pricing is expected Thursday.
Yields ranged from 0.53% with a 3% and 5% coupon in a split 2016 maturity to 4.68% with a 4.625% coupon in 2043. Bonds maturing in 2015 were offered via sealed bid. Portions of bonds maturing between 2025 and 2043 were not offered for retail. The bonds are callable at par in 2023.
Citi priced for retail $360.1 million of triple-A Battery Park City Authority senior revenue bonds. Institutional pricing is expected later Wednesday.
Yields on the first series of $353.2 million of tax-exempt bonds ranged from 0.41% with a 2% and 3% coupon in a split 2015 maturity to 4.05% with a 4% coupon in 2031. The bonds are callable at par in 2023.
The second series of $6.9 million of taxable bonds were offered via sealed bid.
RBC Capital Markets is expected to price for institutions $209.1 million of Pennsylvania Turnpike Commission bonds. The deal includes $107.4 million of subordinate revenue bonds, rated A3 by Moody's Investors Service and A-minus by Standard & Poor's and Fitch, and $101.7 million of motor license fund-enhanced turnpike subordinate special revenue bonds, rated A1 by Moody's and AA by Fitch.
In retail pricing Tuesday, yields on the first series, $83.6 million of turnpike subordinate revenue bonds, ranged from 0.50% with a 2% coupon in 2014 to 5.18% with a 5.125% coupon in 2043. Portions of bonds maturing between 2026 and 2043 were not offered for retail. The bonds are callable at par in 2023.
The second series, $23.8 million of turnpike subordinate revenue convertible capital appreciation bonds, were not offered for retail.
Yields on the third series, $81.8 million of motor license fund-enhanced turnpike subordinate special revenue bonds, ranged from 0.35% with a 2% coupon in 2014 to 4.52% with a 4.5% coupon in 2031. Portions of bonds maturing between 2026 and 2043 were not offered for retail. The bonds are callable at par in 2023.
The fourth series, $19.9 million of motor license fund-enhanced turnpike convertible capital appreciation bonds, was not offered for retail.
On Tuesday, yields on the triple-A Municipal Market Data scale ended as much as five basis points higher. The 10-year yield rose two basis points to 2.62% and the 30-year yield jumped five basis points to 4.23%. The two-year was steady at 0.35% for the third session.
Yields on the Municipal Market Advisors benchmark scale ended as much as four basis points higher. The 10-year yield increased two basis points to 2.77% and the 30-year yield climbed four basis points to 4.37%. The two-year was unchanged at 0.55% for the fifth session.
Treasuries were mostly flat. The two-year and benchmark 10-year yields were steady at 0.37% and 2.73%, respectively. The 30-year yield fell one basis point to 3.78%.
