Markets

The 12th-hour deal to keep the U.S. from plunging over the fiscal cliff and the yearly rollover of rates provided the impetus for municipal bond yields and indexes on the week to climb.

Natixis Global Asset Management, which recently acquired McDonnell Investment Management, has launched a new municipal bond fund.

Long-term municipal bond volume rose modestly for the month of December, closing the door gently on a year that saw record low interest rates spur an upsurge in refundings.

Volume in the municipal bond market should climb incrementally from the holiday week, to $161.3 million, up from total sales of just $14.0 million last week.

For a second consecutive week, flows to muni bond mutual funds got hammered. Funds that report their flows weekly recorded outflows of $423 million for the week ended Dec. 26.

Slight activity in the municipal market during the holiday week left tax-exempt yields mostly unchanged since last Friday, but accounted for mostly lower indexes.

Traders took a varied view of the municipal market Thursday. While some secondary market traders reported a decent amount of activity in the intermediate part of the muni yield curve throughout the day's session, others said they heard little more than crickets over the span.

Healthcare bond issuance is expected to continue its increase next year, with an estimated $34 billion, according to a BofA Merrill Lynch report.

Columbus, Ohio, Auditor Hugh J. Dorrian intends to ask for authority to refund up to $475 million of Build America Bonds and recovery zone economic development bonds if federal subsidies are cut under sequestration or in a deal to avoid the fiscal cliff.