Markets

The range of risks facing the higher education sector could lead to uneven credit performance in 2013, according to Standard & Poor's.

Short and selective. That is the fixed-income philosophy that Guy LeBas, director of fixed income strategy at Janney Montgomery Scott, is putting increased focus on in 2013 because of the predominance of interest-rate risk in the market.

Municipal bond investors have watched credit spreads in the market narrow considerably over the past three years. And they aren't expected to reverse course anytime over the next 12 months.

A leaden and lackluster municipal market shuffled into the afternoon Monday. While the retail order periods for some of the week's issuance seep in, market participants, particularly institutions, have been holding their fire in the secondary in anticipation of larger offers to come, giving the market a ponderous tone.

Chicago received 16 responses in its first market outreach to identify prospective bidders in a possible deal to privatize Midway International Airport, according to the city's chief financial officer Lois Scott.

The municipal bond market adopted a weaker tone beyond the front end of the curve out of the gate Monday.

After the municipal market struggled to get through a heavy new-issue calendar last week, another slate of sizable new deals will test the market this week, anchored by a $1.3 billion California higher education deal.

Nearly all The Bond Buyer's weekly yield indexes increased the week ended Feb. 21.

Flows to municipal bond mutual funds remained positive for a seventh straight week, but only modestly so, recording $292 million in inflows for the week of Feb. 20.

Moody's Investors Service has a negative outlook on local governments, which continue to be pressured in the slow and uneven economic recovery.