Markets

After the selloff municipal strategists preparing for the start of the third quarter were torn between taking advantage of buying opportunities and being ultra conservative to protect assets from future weakness.

The muni market, reeling from one of the worst selloffs in 25 years this week, witnessed record-breaking outflows to muni bond funds of $4.53 billion for the week of June 26.

The Bond Buyer's weekly yield indexes posted pronounced losses the week ended June 27, reflecting the market selloff.

Municipal bond mutual funds that report flows weekly recorded $4.53 billion in outflows for the week of June 26, Lipper FMI numbers showed, after $2.22 billion of outflows reported the previous week.

Tax-exempt money market funds had outflows of $314.7 million in the week ended June 24, decreasing total net assets to $261.48 billion, according to The Money Fund Report, a service of iMoneyNet.com.

Falling yields for single-A and triple-B bonds with longer maturities on Tuesday signaled the municipal market was ready to pause after one of the heaviest selloffs in more than two decades.

Current tax-free yields are attractively priced compared to Treasuries, creating opportunity for municipal investors, says Alan Schankel of Janney Capital Markets.

Municipal bond investors, spooked that interest rates' climb from record lows is accelerating, continue to pull money from the market in record-breaking droves.

The Bond Buyer's weekly yield indexes increased significantly the week ended June 20.