Markets

The Bond Buyer's weekly yield indexes rose the week ended July 11.

Investor demand for tax-exempts remained tepid as outflows from muni bond funds for the week of July 10 accelerated to $1.2 billion from $870 million the prior week.

Following last month's historic sell-off, the municipal market offers solid fundamentals and the most compelling value since 2011, additionally bolstered by the strong demand from July and August reinvestments and the demand from crossover buyers, BlackRock Inc. said in its July municipal report.

A $700 million Denver Airport System financing and a $634 million California Health Facilities Financing Authority sale will dominate the primary market this week as more than $6 billion greets investors returning from a long holiday weekend that may be ready, willing, and able to reinvest July 1 cash after a short hiatus.

Modest inflows of $903.9 million crept back into municipal money market funds as total net assets inched up to $262.38 billion in the week ended July 1, according to The Money Fund Report, a service of iMonetNet.com.

Early indications of July 1 reinvestment appeared mediocre this week as investors took a much-need break from the municipal market – some preoccupied by the Fourth of July holiday and Friday's June employment figures, others still reeling from the volatility of the historic sell-off two weeks ago, municipal players said.

The recent market selloff battered municipal bonds unevenly, as those investors holding credits with higher coupons fared the best.

June, traditionally a strong month for municipal bond issuance, provided more bad numbers in a difficult period for the market. Long-term muni bond volume for June plunged 46.5% from the same period in 2012.