Great rotation or not, more money hemorrhaged from municipal bond mutual funds this past week.
Outflows occurred for the sixth straight week despite the
Around midweek, $2 billion deals from California and Florida both arrived and were reasonably well received, traders reported. In the secondary, activity on Tuesday and Wednesday closed higher than 30-day averages, according to MSRB numbers.
Muni bond yields outperformed those of Treasuries on the week since Friday, even though both saw weakening over the span. The 10-year triple-A rose three basis points on the week to 1.74%.
The 30-year yield increased four basis points to 2.97%. The two-year held steady over the week from Friday at 0.29% for a fifth consecutive session.
Muni ratios to Treasuries beyond the front end of the yield curve pushed lower into rich territory over the week. Both the 10-year and the 30-year settled below 100%.
Assets for all muni funds that report their flows weekly rose for a fourth straight week to $327.4 billion. The week prior, they reported $326.8 billion.
The value of the holdings for weekly reporting funds rose by $1.15 billion. The week before, they rose by $869 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly was $303 million of outflows, falling from $174 million in outflows the week before.
Long-term bond funds that report their flows weekly still saw outflows, but they were considerably lighter than they have been over the past several weeks, at just $54 million. That represented a large increase from the $205 million of outflows they reported the week before.
High-yield muni funds are shifted back to reporting inflows after a week of outflows, and have been oscillating back and forth over the past month. For most of 2012 and 2013, flows were and have been positive.
High-yield funds that report weekly saw $66 million in inflows, Lipper said. The previous week, they reported $41 million in outflows.
Assets for high-yield funds that report their flows weekly rose to $45.61 billion. They're up from $45.35 billion reported the week before.
The value of the holdings for weekly reporting high-yield funds rose by $195 million. Last week, they increased by $171 million.
The four-week moving average for all high-yield municipal bond funds that report their flows weekly showed just $1.1 million of inflows, rising slightly from $36 million of outflows the week before.