NEW YORK – The California municipal market was unchanged with a slightly weaker tone Monday amid light to moderate secondary trading activity.
“We’re mostly flat,” a trader in Los Angeles said. “There’s still a bit of a weaker tone, and we might be down a basis point in spots, but there wasn’t a whole lot of activity in the secondary and we were just pretty flat through most of the curve.”
The Municipal Market Data triple-A scale yielded 2.42% in 10 years and 3.33% in 20 years Monday, matching Friday. The scale yielded 3.72% in 30 years Monday, also matching Friday.
Monday’s flatness ended a string of seven consecutive sessions of rising yields, after just one such sell-off the entire month of August.
Before the recent sell-off, yields dropped to all-time lows in 10-year munis 12 times in the prior 17 sessions. Also, 30-year tax-exempts set record lows four times in the previous eight sessions, while 20-year munis established all-time lows five times over the same time period.
The record lows currently stand at 2.17% and 3.67% in 10- and 30-year tax-exempts, both established August 25. The 20-year low of 3.28% was set August 31.
Friday’s triple-A muni scale in 10 years was at 86.7% of comparable Treasuries and 30-year munis were at 96.1%, according to MMD, while 30-year tax-exempt triple-A general obligation bonds were at 106.3% of the comparable London Interbank Offered Rate.
The Treasury market was showed gains Monday. The benchmark 10-year note was quoted at 2.74% after opening at 2.79%.
The 30-year bond was quoted at 3.84% after opening at 3.86%. The two-year note was quoted at 0.54% after opening at 0.57%.
The economic calendar was light Monday.
Activity in the California new-issue market was light Monday.
Previous Session's Activity
The most actively traded security in the state yesterday was taxable Sonoma County 6s of 2029, which traded 78 times at a high of 102.289 and a low of 99.600.
