Lynne Funk

Triple-A benchmarks saw cuts of one to two basis points across the curve, but still outperformed two days of UST weakness and have outperformed UST losses since the start of the month.

Better-than-expected job gains, a rising UST complex and an increase in supply to test municipals' resolve.

Secondary trading petered off into Thursday afternoon, holding triple-A benchmarks steady as most participants await Friday's nonfarm payrolls.

The firm has brought on Kalotay Analytics' quantitative libraries to calculate certain metrics, including average life dates and cash-flow yields for taxable term bonds.

The short end of the market has little room to fall lower.

With all eyes on Friday’s employment report, since several additional strong months of gains are needed for the Federal Reserve to be comfortable announcing a tapering of its asset purchases, Wednesday’s news could signal trouble.

Tighter bidding on bonds 10 years and in pushed high-grade benchmark curves to bump yields.

Municipals returned 0.83% in July with a year-to-date return of 1.90%. High-yield returned 1.20% in July and 7.40% year-to-date. Taxables led July with 1.65% returns and 1.95% for the year.

That expansion wholly depends on Washington actually bringing back the taxable product and making it permanent, a diminishing scenario in 2021.

Muni participants await a new month with growing issuance, but perhaps not quite enough as issuers are hesitant to add more debt before final word from Washington on infrastructure.

Washington GOs came at tighter spreads than a spring sale in the competitive market while sizable negotiated deals saw bumps in repricings. Refinitiv Lipper reported $1.4 billion of inflows in the 21st consecutive week.

The massive summer reinvestment into municipal bond mutual funds continue and are both sustaining the strength of investor demand and solidifying the technical footing of the market.

With municipal yields at exceedingly low absolute levels, the spread tightening between credits also continues.

The pilot program aims to expand its all-to-all Open Trading marketplace by allowing investor clients to select a diversity dealer to intermediate in secondary trading.

The last week of July marks a lighter calendar while August redemptions are huge compared to the expected supply. Investors need to get in line and likely accept lower yields and continued historically low ratios.

Whether a BABs-like program could make it into actual law in Washington is still highly uncertain. What is certain: Some form of infrastructure spending is must-pass legislation because federal-aid highway funding is set to expire in October.

The larger new issues and aggressive swings in taxables had investors on guard as triple-A curves were pressured outside 10-years, but the asset class still vastly outperformed UST while ICI reports nearly $3 billion more inflows.

The agency withdrew its ratings on the commonwealth and all of its authorities for its own business reasons.

Negotiated deals were repriced to lower yields while competitive deals saw levels coming in through triple-A benchmarks. High-grade benchmarks were little changed.

Municipal triple-A benchmarks were pushed to lower yields by one to three basis points across the curve, with the bigger moves out long, but still vastly underperformed the 10-plus basis point moves in UST.