Most of The Bond Buyer's weekly yield indexes rose this week, as municipal yields rose in almost all the week's sessions.
George Strickland, managing director and portfolio manager at Thornburg Investment Management, said that two trends stand out for the week.
"One is higher yields in general, sort of following what's going on in the Treasury market, and I think some steepening that went along with that, so more yield give-up, more price pressure on the long end of the market," he said. "And then I think we've seen some decent spread-tightening happening in the marketplace. Spreads seem to be continually compressing for things like weaker insured bonds, or gas prepayment bonds, and those kind of things."
"In general, there's a weaker trend, but it's hitting high grades more than low grades," Strickland continued.
The municipal market was slightly firmer Friday, following the Treasury market. Then, Monday, munis were mixed, as Banc of America Securities LLC priced $475 million of general obligation bonds for New York City. The bonds were slated for retail pricing yesterday, but retail orders were cut off during the session, and the deal was priced for institutional investors.
Tuesday, tax-exempts were unchanged to slightly weaker yesterday after stronger than expected economic data. In the new-issue market, Goldman, Sachs & Co. priced $608.8 million of airport system revenue bonds for Denver in two series.
The muni market was unchanged to slightly weaker Wednesday as Bear, Stearns & Co. priced $2.3 billion of taxable general obligation bonds for Connecticut's retirement fund. Also, Goldman Sachs priced $428.8 million of subordinated power supply revenue refunding bonds for the Intermountain Power Agency in Utah.
Then yesterday, the municipal market was again slightly weaker.
The Bond Buyer 20-bond index of GO yields rose one basis point this week to 4.62%, but it remained well below the 4.90% level from two weeks ago.
The 11-bond index was unchanged from last week at 4.53%.
The revenue bond index rose two basis points, to 5.06%, but remained below its 5.18% level from two weeks ago.
The 10-year Treasury note rose 19 basis points to 3.72%, its highest level since Feb. 21, when it was 3.76%.
The 30-year Treasury bond rose 19 basis points to 4.51%, its highest level since March 13, when it was 4.57%.
The Bond Buyer one-year note index rose two basis points to 1.56%, but remained below its 1.58% level from two weeks ago.
The weekly average yield to maturity on The Bond Buyer 40-bond municipal bond index finished at 4.95%, down 9 basis points from last week's 5.04%.