The institutional pricing of the New York City Transitional Finance Authority's $700 million deal is scheduled for Thursday, one of the last big deals coming to market this week.
Municipal bond market participants are already looking ahead to the upcoming week, when large offerings from California and Maryland have been slated.
Secondary Market
Treasury prices were higher on Thursday. The yield on the two-year Treasury note declined to 0.59% from 0.61% on Wednesday while the 10-year yield decreased to 1.96% from 1.99% and the 30-year yield dropped to 2.56% from 2.60%.
Prices of top-quality municipal bonds finished stronger on Wednesday. The yield on the 10-year benchmark muni general obligation was off three basis points to 2.04% from 2.07% on Tuesday, while the yield on 30-year GO was down one basis point to 2.86% from 2.87%, according to the final read of Municipal Market Data's triple-A scale.
On Wednesday, the 10-year muni to Treasury ratio was calculated at 103.5% versus 104.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 111.3% compared to 110.6%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $2.326 billion to $10.008 billion on Thursday. The total is comprised of $3.259 billion competitive sales and $6.750 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 38,854 trades on Wednesday on volume of $9.877 billion.
Most active on Wednesday, based on the number of trades, was the Winnebago and Boone Counties, Ill., School District No. 205's 2015 Series B 4s of 2035, which traded 89 times at an average price of 101.479, with an average yield of 3.801%.
Primary Market
Wells Fargo Securities is set to price the NYC TFA's $700.495 million of tax-exempt fixed-rate refunding bonds for institutions on Thursday. The offering had an order period for retail investors on Tuesday and Wednesday.
The TFA $654.23 million future tax secured tax-exempt subordinate bonds, Fiscal 2015 Series C, were priced for retail to yield from 0.70% with a 4% coupon in 2017 to 3.25% with a 3.25% coupon in 2031; a 2016 maturity was offered as a sealed bid. The $46.265 million future tax secured tax-exempt subordinate bonds, Fiscal 2015 Series D, were priced for retail to yield from 0.70% in 2017 with a 4% coupon to 2.71% with a 4% coupon in 2027; the 2015 and 2016 maturities were offered as sealed bids.
The bonds are rated Aa1 by Moody's Investors Service and triple-A by Standard & Poor's and Fitch Ratings.
Several large deals are already on the calendar for next week.
Bank of America Merrill Lynch and Morgan Stanley are scheduled to price California's $1.9 billion of general obligation bonds for retail investors on Tuesday followed by the institutional pricing on Wednesday. The deal is rated Aa3 by Moody's and A-plus by both S&P and Fitch.
On the competitive side, Maryland is scheduled to auction two issues totaling about $922 million on Wednesday. The deals consist of $518 million tax-exempt First Series A State and Local Facilities Loan of 2015 GOs and $404 million First Series B State and Local Facilities Loan of 2015 refunding GOs. The issue is rated triple-A by Moody's, S&P and Fitch.
