Markets

SAN JUAN — Nearly one year after Puerto Rico implemented its fiscal reconstruction plan to reduce operating costs, generate more tax revenue, and curtail borrowing, investors are both optimistic and cautious.

After digesting more than $6 billion of new volume last week, the municipal market is again expected to make room for an additional $6.28 billion in estimated new supply planned this week, according to Ipreo LLC and The Bond Buyer.

Money continued to flood municipal bond mutual funds at a steady pace last week, as continuing concerns about state and local government credit and a hike in the Federal Reserve’s discount rate did little to deter investors.

Nearly all The Bond Buyer’s weekly yield indexes declined this week, as the municipal market spent much of the last week either in unchanged or slightly firmer territory.

After a seven weeks in the desert, tax-exempt money market funds finally saw a modest trickle of inflows in the week ending Feb. 22. The gain of $187.7 million, raising total assets to $381.75 billion, marked only the second time this year that the funds were on the positive side of the ledger, according to the Money Fund Report, a service of iMoneyNet.com.

Oppenheimer & Co. agreed to buy back from clients tens of millions of dollars of auction-rate securities under settlements with two states announced yesterday.The New York-based investment bank was accused by New York and Massachusetts of marketing ARS as safe, liquid alternatives to cash, without explaining the risks.

For anyone still not convinced that Build America Bonds are transforming state and local government finance, behold a municipal bond mutual fund that has filed a prospectus in French.

WASHINGTON — The Securities and Exchange Commission formally released a series of final changes to its Rule 2a-7 on money market funds Tuesday aimed at boosting the resilience of funds during market crises, and set a March 5 effective date for them.

Muriel Siebert likes municipal bonds.

The river of new money flowing into municipal bond mutual funds shows no sign of subsiding, rebounding the past two weeks after a brief dip at the beginning of the month.