Markets

The Affordable Housing Credit Improvement Act is reintroduced in the House of Representatives with bipartisan support to increase the development of affordable housing by leveraging private activity bonds and loosening restriction on Low Income Housing Tax Credits.

Weakness in the muni market has been partly amplified by ETF selling; high-grade yields rose more than 60 basis points on parts of the curve over two sessions.

A new S&P upgrade and one last year from Moody's burnish the Colorado Statewide Bridge and Tunnel Enterprise ahead of a $212 million revenue bond deal.

"The changing momentum on what the market is looking for on tariffs and the volatility in the equity market is spilling over into the Treasury market, and munis can only fight the Treasury market for so long," said Pat Luby, head of municipal strategy at CreditSights.

"In the aftermath of this week's Treasury yield move lower, MMD-UST ratios have reached short-term highs," Barclays strategists said.

"With the initial announcement proving to be more aggressive than expected, the market responded overwhelmingly negatively," said Principal Asset's Seema Shah.

Parity Plus gives muni issuers increased transparency and resources to determine market demand prior to a bond sale.

Details surrounding the tariffs — which could be anything from reciprocal tariffs to finally implementing delayed tariffs on Canada and Mexico and on pharmaceuticals — have remained unclear, but uncertainty has plagued the market for weeks.

Fallout from the Legacy Cares deal includes bondholder lawsuits against the underwriter and bond counsel, payment defaults, a Chapter 11 bankruptcy, and now fraud charges from the SEC and DOJ.

The deal will raise money for general purposes as the Ivy League school faces cuts to government grants as the Trump administration attacks higher education.