Markets

A pair of deals from two New York municipalities and a Texas sale will headline an estimated slate of $4.47 billion in total new-issue supply in the primary market this week - more than double the revised figures from last week - as municipal volume continues to show signs of recovery from the month-long dry spell inflicted by the nation's financial and economic turmoil.

Weekly reporting municipal bond mutual funds had a net outflow of $1.126 billion during the period ending Oct. 15, AMG Data Services reported.

The Bond Buyer's weekly yield indexes plummeted this week, after a sizeable rally Tuesday led to a historic one Wednesday, and the market then held firm yesterday.

Amid increased demand and liquidity in the short-term market, inflows kept tax-exempt money market funds in positive territory for a third week in a row, gaining $7 billion in new cash for the week ending Oct. 20, according to the Money Fund Report, a service of iMoneyNet.com.

Following the pricing of last week's $5 billion revenue anticipation note sale by California, both the short- and long-term primary markets will be much more subdued this week, with only a handful of negotiated deals expected to be priced by issuers willing to enter the market at the prevailing higher interest rates.

Weekly reporting municipal bond mutual funds had a net outflow of $2.285 billion during the period ending Oct. 15, AMG Data Services reported.

SAN FRANCISCO - The Bond Buyer's weekly yield indexes surged this week, as the market continued to struggle against a wave of capital rushing to exit.

For the second week in a row, tax-free money market funds showed signs of slow but steady recovery, demonstrated by the arrival of $6.12 billion in new cash, which caused assets to inch up to $490.86 billion for the week ending Oct. 13, according to the Money Fund Report, a service of iMoneyNet.com.

A quest for cash in a highly illiquid market and a lack of investor confidence in the tax-exempt bond market in general are among the factors that have sent the yield for The Bond Buyer 40 Bond Index soaring in recent days.

The arrival of a handful of new issues this week will help revive the recently lifeless primary market after it all but shut down for nearly the last month.