Markets

The New York City Transitional Finance Authority is set up to refund Build America Bonds as part of a $2.11 billion deal slated to land in the market this week.

In the summer, the market will largely move "sideways" and underperform late in the third quarter to early in the fourth quarter, "while possibly recouping most of its losses late in the year depending on the outcome of November elections," said Barclays strategists.

The Public Finance Authority, a Wisconsin-based conduit issuer, approved the municipal bond sale for the roads operated by Spanish firm Abertis in a P3.

"Bond yields are plunging [Thursday] as rate cut expectations soar following this morning's consumer price index release, which depicted the first month of deflation since July 2022," noted José Torres, senior economist at Interactive Brokers.

Large-scale issuers, including state-level transportation authorities, counties and sales tax entities, have "planned volume to coincide with implied demand," said Kim Olsan, senior vice president of municipal bond trading at FHN Financial.

Unfunded public pension liabilities have dropped more than 60%, or $3 trillion, from the peak in 2020, according to a new Moody's Ratings report.

A revenue bond issue for Galveston Wharves will price Tuesday after Hurricane Beryl interrupted port operations earlier this week.

Overall, demand is "high," an ongoing tailwind for munis, along with solid fundamentals, Nuveen strategists said.

The company says merging Assured Guaranty Municipal Corp. into Assured Guaranty Inc. will reduce duplication and represents a better use of capital.

S&P Global Ratings revised the outlook on the city's AA rating to negative from stable, citing increased debt and costs from a settlement with firefighters.