One day after the Chicago Public Schools postponed what would have been the largest deal of the week, the municipal bond market on Thursday is awaiting the last of the week's new issue supply.
Secondary Market
Treasuries were mixed in early trading on Thursday. The yield on the two-year Treasury fell to 0.81% from 0.84% on Wednesday, while the 10-year Treasury yield declined to 1.98% from 2.00% and the 30-year Treasury bond yield increased to 2.80% from 2.79%.
Top-quality municipal bonds finished mixed on Wednesday. The yield on the 10-year benchmark muni general obligation was unchanged from 1.75% on Tuesday, while the 30-year muni yield gained two basis points to 2.77% from 2.75%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Wednesday at 87.5% compared to 87.8% on Tuesday, while the 30-year muni to Treasury ratio stood at 98.2% versus 98.9%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 36,483 trades on Wednesday on volume of $7.07 billion.
Primary Market
On Wednesday, the CPS pulled its $875 million general obligation bond deal and placed it on day-to-day status.
The district's finance officials said the decision was made to give investors more time to digest the deal and the underwriting syndicate time to tinker with an accommodating structure.
In the competitive arena on Thursday, Waco, Texas, will competitively sell two issues totaling $104.31 million.
The sales consist of $77.75 million of Series 2016 combination tax and revenue certificates of obligation and $26.56 million of Series 2016 GO refunding bonds.
Both issues are rated Aa2 by Moody's Investors Service and AA-plus by Standard & Poor's.
Since 2005, the city of Waco has sold about $560 million of bonds. In the same time period, Waco has issued bonds an average of 1.2 times a year.
Also on Thursday, JPMorgan is set to price the Connecticut Health and Educational Facilities Authority's $250 million of revenue bonds for Yale University in a remarketing of two- and five-year put bonds.
The issue is rated triple-A by Moody's and S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $1.1 billion to $5.69 billion on Thursday. The total is comprised of $2.25 billion of competitive sales and $3.44 billion of negotiated deals.
Tax-Exempt Money Market Funds Post Outflows
Tax-exempt money market funds experienced outflows of $6.06 billion, bringing total net assets to $248.94 billion in the week ended Jan. 25, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $2.12 billion to $255.00 billion in the previous week.
The average, seven-day simple yield for the 354 weekly reporting tax-exempt funds remained at 0.01% for the 143rd straight week.
The total net assets of the 941 weekly reporting taxable money funds increased $22.13 billion to $2.514 trillion in the week ended Jan. 26, after an outflow of $11.43 billion to $2.492 trillion the prior week.
The average, seven-day simple yield for the taxable money funds remained at 0.08% for a second straight week.
Overall, the combined total net assets of the 1,295 weekly reporting money funds rose $16.06 billion to $2.763 trillion in the period ended Jan. 26, which followed an outflow of $13.56 billion to $2.747 trillion in the prior week.
Yvette Shields contributed to this report
