Finance

The outlook revision to negative for the Texas Biomedical Research Institute cited weakened liquidity and reliance on federal grants, the rating agency said.

"On a month-to-date basis, AAA munis have outperformed Treasuries across the entire curve. … This outperformance can be attributable to an improvement in market technicals," said Daryl Clements, a portfolio manager at AllianceBernstein.

The college's most recent annual comprehensive financial report is for the fiscal year ending June 30, 2023, and S&P is concerned by the lack of timely reporting.

Munis have outperformed USTs and corporates by more than 1.0% month-to-date on the heels of this rally so far, BofA strategists said.

Munis saw cuts, albeit small ones, for the first time in nearly two weeks as yields rose up to four basis points, depending on the scale.

The rating agency cited New Jersey's "robust budgetary surplus" while continuing to make actuarially based pension contributions.

By the close, muni yields were bumped up to four basis points, depending on the curve, while UST yields rose two to five basis points.

Walter O'Connor's decades-long tenure as a municipal bond portfolio manager at BlackRock will come to an end next year. 

As the "slope of the municipal yield curve remains extremely steep and long bonds are cheap relative to U.S. Treasuries," Daryl Clements, a portfolio manager at AllianceBernstein, predicts "long municipal bonds have a long way to go until they are considered fair value."

"This was a much-needed rally as the long end struggled throughout the year, but now has been pushed back into positive territory," said Jason Wong, vice president of municipals at AmeriVet Securities.