Munis cheapened Tuesday, as U.S. Treasuries saw small gains out long and equities ended lower.
Muni yields were cut by up to seven basis points, depending on the scale, as USTs richened by up to two basis points.
Heavy issuance and misaligned muni-UST ratios are driving a correction, NewSquare Capital's Kim Olsan said. However, there's still "underlying cash available."
"One thing I would say that stood out [Tuesday] is there appeared to be pretty good response to cut prices, higher yields," Olsan said.
The customer buy-to-sell ratio was around 60% buys across most major maturity ranges, Olsan said, citing Bloomberg data.
New-issue market
In the primary market Tuesday, Jefferies priced for the Los Angeles Department of Airports (/AA/AA/) $2.69 billion of senior revenue and refunding revenue bonds. The first tranche, $1.249 billion of private activity/AMT green Series 2026A bonds, with 5s of 5/2027 at 2.82%, 5s of 2031 at 3.37%, 5s of 2036 at 3.85%, 5s of 2041 at 4.37%, 5.25s of 2046 at 4.69%, 5.5s of 2051 at 4.85% and 5.5s of 2056 at 4.90%, callable 5/2036.
The second tranche, $654.11 million of private activity/AMT Series 2026B bonds, saw 5s of 5/2027 at 2.82%, 5s of 2031 at 3.37%, 5s of 2036 at 3.85%, 5.25s of 2041 at 4.37%, 5.25s of 2046 at 4.69% and 5.5s of 2051 at 4.85%, callable 5/2036.
The third tranche, $768.23 million of governmental purpose/non-AMT Series 2026C bonds, saw 5s of 5/2027 at 2.27%, 5s of 2031 at 2.70%, 5s of 2036 at 3.28%, 5s of 2041 at 3.90%, 5s of 2046 at 4.22%, 5s of 2051 at 4.53% and 5.25s of 2056 at 4.61%, callable 5/2036.
BofA priced for Hamilton County, Ohio, (Aa1/AA-//) $460.92 million of Paycor Stadium improvement project sales tax improvement and refunding bonds, with 5s of 12/2029 at 2.82%, 5s of 2031 at 3.01%, 5s of 2036 at 3.58% and 5s of 2039 at 3.91%, callable 12/2034.
In the competitive market, the Maryland Transportation Authority (Aa2//AA/) sold $370.86 million of transportation facilities projects revenue bonds to Morgan Stanley, with 5s of 7/2027 at 2.53%, 5s of 2031 at 2.88%, 5s of 2036 at 3.48%, 5s of 2041 at 3.99%, 5s of 2046 at 4.36%, 5s of 2051 at 4.67% and 5s of 2056 at 4.86%, callable 7/2036.
