Markets

Fitch follows Moody's in revising the Empire State's debt to negative from stable.

Moody’s revised its outlook on Illinois’ Baa3 rating to negative from stable; a university study warns of a worst-case $28 billion multi-year revenue hit.

The Fed will help the muni market navigate the short-term pain caused by coronavirus via direct purchases of bonds on the short end. However, the Fed will effectively hand off the responsibility to choose winners and losers to state officials, a move the market generally greeted positively.

Jobless claims declined 261,000 from the previous week’s revised level of 6.87 million, originally reported as 6.65 million.

Christopher Philips, CFA, head of Vanguard Institutional Advisory Services, discusses the importance of asset allocation during uncertain times as the coronavirus hits investors’ portfolios. He talks about looking at the fundamentals while distancing from the day-to-day value fluctuations. John Hallacy hosts this podcast, which was recorded March 20.

The market appears to be moving toward some semblance of normal conditions as the new-issue pricings and moderating bid volume create a more stable tone.

The review by Moody's Investors Service comes as the district is working on new money and refinancing deals.

Despite a muted month of March due to the COVID-19 pandemic which included two weeks of no negotiated deals, muni bond issuers still sold more long-term debt than they did during the first three months of 2019. Issuers accounted for a total of $84.87 billion of bonds throughout 2,119 transactions, compared to $75.84 billion in 1,809 deals in first quarter of 2019. The top 10 features five newcomers from a year ago, including the top spot.

Underwriters of municipal bonds did the majority of business during the first two months of the year, before COVID-19 swept the country with sickness and severe spreading. The top underwriters accounted for $87.84 billion of bonds throughout 2,119 transactions, compared to $75.84 billion in 1,809 deals in first quarter of 2019.

Tax-exempt and taxable deals priced as dealers opened up their balance sheets to new issues while the market still awaits word from the Fed on coronavirus-led purchase programs.