The busiest day of the week is underway as deals from issuers in Texas, Maryland and Georgia have hit screens.
Munis were stronger on Thursday at midday, as yields on some maturities were three to five basis points lower, according to traders.
Primary Market
Morgan Stanley priced the Dallas Area Rapid Transit's $482.53 million of Series 2016A senior lien sales tax revenue refunding bonds. The bonds were priced to yield from 2.00% with a 5% coupon in 2026 to 2.70% with a 5% coupon in 2036. Term bonds in 2041, 2046 and 2048 were priced as 5s to yield 2.96%, 3.02% and 3.07%, respectively. The DART deal is rated Aa2 by Moody's Investors Service and AA-plus by Standard & Poor's.
Since 2007, DART has issued bonds on average once a year, selling about $4.32 billion, with the largest issuances in 2009 and 2010 when it offered $1 billion and $825 million, respectively. It did not issue any bonds in 2011, 2013 or 2015.
In the competitive arena, the Metropolitan Atlanta Rapid Transit Authority, Ga., sold $247.725 million of refunding series 2016B sales tax revenue bonds, Third Indenture Series. The bonds were won by Morgan Stanley with a true interest cost of 3.30%. No other pricing information was immediately available. The deal is rated Aa2 by Moody's.
MARTA last competitively sold comparable bonds on Nov. 5, 2015, when Wells Fargo Securities won $181.57 million of Series 2015B sales tax revenue bonds, Third Indenture Series with a TIC of 3.899%.
The Maryland University System competitively sold two issues totaling $201.33 million. The deals consist of $140 million of Series 2016A auxiliary facility and tuition revenue bonds and $61.33 million of refunding Series 2016B auxiliary facility and tuition revenue bonds. Both sales are rated Aa2 by Moody's and AA-plus by S&P.
The Series 2016A bonds were won by Citi with a TIC of 2.55%. The bonds were priced to yield from 0.41% with a 5% coupon in 2017 to 3.08% with a 3% coupon in 2036.
Citi also won the Series 2016B bonds with a TIC of 1.85%. The bonds were priced to yield from 0.41% with a 2% coupon in 2017 to 2.50% with a 2.375% coupon in 2030.
The Chicago Board of Education's $725 million GOs were free to trade at noon, eastern time.
Secondary Market
On Thursday afternoon, the yield on the 10-year benchmark muni general obligation was steady from 1.66% on Wednesday, while the 30-year muni yield was flat at 2.72%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were stronger Thursday midday. The yield on the two-year Treasury was down to 0.71% from 0.72% on Wednesday, while the 10-year Treasury yield was down to 1.86% from 1.88% and the 30-year Treasury bond yield fell to 2.70% from 2.71%.
The 10-year muni to Treasury ratio was calculated on Wednesday at 85.8% compared to 90.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 99.6% versus 101.7%, according to MMD.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $1.21 billion to $11.21 billion on Thursday. The total is comprised of $4.44 billion of competitive sales and $6.77 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,194 trades on Wednesday on volume of $8.189 billion.
Tax-Exempt Money Market Funds Post Outflows
Tax-exempt money market funds experienced outflows of $1.57 billion, bringing total net assets to $247.37 billion in the week ended Feb. 1, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $6.06 billion to $248.94 billion in the previous week.
The average, seven-day simple yield for the 354 weekly reporting tax-exempt funds remained at 0.01% for the 144th straight week.
The total net assets of the 946 weekly reporting taxable money funds increased $8.55 billion to $2.523 trillion in the week ended Feb. 2, after an inflow of $22.13 billion to $2.514 trillion the prior week.
The average, seven-day simple yield for the taxable money funds increased to 0.09% after two consecutive weeks at 0.08%.
Overall, the combined total net assets of the 1,300 weekly reporting money funds rose $6.98 billion to $2.770 trillion in the period ended Feb. 2, which followed an inflow of $16.06 billion to $2.763 trillion in the prior week.
