Top-quality municipal bonds were mixed at mid-session, according to traders, as some of the biggest deals of the week hit the market.
But one deal that traders won't be seeing is Alaska's $2.35 billion of taxable pension obligation bonds. The deal was originally slated to be priced by Citigroup on Wednesday, but Gov. Bill Walker called it off due to a lack of legislative support.
Secondary Market
The yield on the 10-year benchmark muni general obligation was flat from 1.72% on Tuesday, while the yield on the 30-year was as much as one basis point higher from 2.54%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were weaker on Wednesday. The yield on the two-year rose to 0.87% from 0.85% on Tuesday, the 10-year Treasury yield gained to 1.78% from 1.76% and the yield on the 30-year Treasury bond increased to 2.53% from 2.50%.
On Tuesday, the 10-year muni to Treasury ratio was calculated at 97.9% compared to 99.1% on Monday, while the 30-year muni to Treasury ratio stood at 101.6% versus 102.0%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 38,741 trades on Tuesday on volume of $10.38 billion.
Primary Market
In the negotiated sector, Bank of America Merrill Lynch priced the New Jersey Transportation Trust Fund Authority's $2.81 billion of Series 2016A federal highway reimbursement revenue notes.
The $1.52 billion section of the issue was priced as 5s to yield from 2.17% in 2019 to 3.47% in 2025 and from 3.80% with a 5% coupon in 2027 to 4.15% at par in 2031. The $1.3 billion part of the deal was priced as 5s to yield from 2.36% in 2021 to 2.54% in 2024 and as 5s to yield from 2.79% in 2028 to 3.05% in 2031.
The deal is rated A3 by Moody's Investors Service, A-plus by S&P Global Ratings and A-minus by Fitch Ratings.
Citigroup priced the Grand Dam Authority, Okla.'s $491.04 million of Series 2016A revenue refunding bonds and Series 2016B taxable revenue refunding bonds.
The $470.12 million of Series 2016A bonds were priced to yield from 1.07% with 3% and 5% coupons in a split 2019 maturity to 3.26% with a 4% coupon in 2039. The $20.92 million of Series 2016B taxables were priced at par to yield from 1.828% in 2020 to 3.503% in 2033.
The deal is rated A1 by Moody's, AA-minus by S&P and A-plus by Fitch.
Piper Jaffray priced the Denver Convention Center Hotel Authority's $273.2 million of Series 2016 senior revenue refunding bonds.
The issue was priced to yield from 1.69% with a 4% coupon in 2019 to 4% at par in 2037; a 2040 maturity was priced as 5s to yield 3.72%. The deal is rated Baa2 by Moody's and BBB-minus by S&P.
Barclays Capital is slated to price the California Health Facilities Financing Authority's $675 million of revenue and refunding bonds for the Cedars-Sinai Medical Center. The deal is rated Aa3 by Moody's and AA-minus by Fitch.
In the competitive arena, the Maryland Department of Transportation auctioned $629.06 million of bonds in two separate offerings.
BAML won the $385 million of Series 2016 consolidated transportation bonds with a true interest cost of 2.31%. The issue was priced to yield from 0.95% with a 5% coupon in 2019 to 2.80% with a 3% coupon in 2031.
JPMorgan Securities won the $244.06 million of refunding Series 2016 consolidated transportation bonds with a TIC of 1.56%. Pricing information was not available.
Both deals are rated Aa1 by Moody's, AAA by S&P and AA-plus by Fitch.
Since 2006, MDOT has issued roughly $3.7 billion of securities, with the largest issuance occurring in 2015, when it sold $961 million. The Old Line State's DOT saw a low year of issuance in 2014, when it issued $100 million.
The South Broward Hospital District, Fla., sold $150.93 million of Series 2016A hospital refunding revenue bonds for the South Broward Hospital District Obligated Group.
JPMorgan won the deal with a TIC of 3.79%. Pricing information was not available. The deal is rated Aa3 by Moody's and AA by S&P.
The California Public Works Board sold $147.39 million of Series 2016E lease revenue bonds for the Department of Corrections and Rehabilitation's RJ Donovan Correctional Facility's various buildings.
BAML won the deal with a TIC of 2.77%. The issue was priced to yield from 0.80% with a 5% coupon in 2017 to 3.24% with a 3% coupon in 2036. The deal is rated A1 by Moody's and A-plus by S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $2.25 billion to $19.10 billion on Wednesday. The total is comprised of $3.94 billion of competitive sales and $15.16 billion of negotiated deals.