Finance

Munis should do "relatively well" this month, as investors will "focus on heavy summer redemptions; tax-exempt supply should remain healthy but is unlikely to overwhelm," said Barclays strategists.

"The rates market has started to turn from the upper end of the trading range this week," Barclays strategists wrote, but with the war with Iran still driving the market, nothing is certain.

New research from The Bond Buyer finds the federal policy environment once again threatens the tax-exempt status for municipal bonds.

Munis and U.S. Treasuries have been more reactive to geopolitical news than to economic data that traditionally moves the market, according to MMA's Kevin McGuigan.

The rating agency cited an improving governance profile, which incorporates a trend of budgetary reserve fund maintenance and increasing pension contributions.

The muni new-issue market got a breather after a heavy supply day on Tuesday, according to Franklin Templeton's Jennifer Johnston.

Spirit's ceasing operations after a failed $500 million bailout comes as the airport sector remains resilient despite ongoing geopolitical tensions, with spreads compressing compared to other transportation sectors despite rising fuel costs, Barclays strategists said.

Senior bonds most recently traded for 30 cents on the dollar.

The muni market digested Tuesday's heavy supply in the way analysts expected, H.J. Sims analyst Tim Iltz said.

SWBC's Chris Brigati said he doesn't expect the geopolitical tensions to cause similar losses to muni yields unless oil prices or Treasury yields move significantly higher.

The ratings agency cited the school's compressed operating margins in recent years.

With continued geopolitical tensions and surging oil prices, things could change on a dime, said Sweta Singh, founding partner and portfolio manager at City Different Investments.

Munis were quiet on Friday after an eventful April.

Moody's Ratings revised Missouri's outlook to negative from stable, citing a large structural deficit that will push fund balances below its Aaa-rated peers.

Investors are digesting developments in the Middle East and the Fed's decision not to cut rates, according to FHN Financial's Ajay Thomas.

The average muni bond trade size fell below $204,000 in the first quarter, down 5% from 2025, according to Municipal Securities Rulemaking Board data.

Saint Michael's College was downgraded to B3 from B1, as Moody's cited growing expenses and lower revenues.

"The market is starting to feel a little bit on the heavy side," said Jamie Iselin, head of municipal fixed income at Neuberger Berman. "The Treasury market has been leaking higher as, I think, people are getting concerned that the conflict in the Middle East is going to [last] longer."

Moody's Ratings downgraded Northern Illinois University's issuer and revenue bond ratings to Ba1 from Baa3.

Muni yields increased "in sympathy with the Treasury market," according to Charles Schwab's Cooper Howard.