The primary muni market is set for another busy week with $10 billion in new paper, as one deal from Illinois accounts more almost half of the calendar.

Ipreo estimates volume will dip to $10.05 billion from the revised total of $10.24 billion sold in the past week, according to updated figures from Thomson Reuters. The calendar for the week ahead is composed of $8.32 billion of negotiated deals and $1.73 billion in competitive sales.

If all the deals come as scheduled, it will mark the first time this year there have been consecutive weeks of $10 billion or greater volume.

“Issuance was decent last week and the market softened a little bit,” said Dawn Mangerson, senior portfolio manager at McDonnell Investment Management. “Still seeing very strong demand and that will continue.”

She said that the volume is a little bit misleading, since most of the negotiated calendar is from one deal.

The biggest deal of the year is set to splash into the market, as Illinois is preparing to come with $4.5 billion general obligation bonds. Barclays is set to run the books and the deal is rated Baa3 by Moody’s Investors Service, BBB-minus by S&P Global Ratings and BBB by Fitch Ratings.

According to market sources, the underwriter sent around a pre-market scale late on Thursday that gauges interest, with the deal most likely to be priced on Tuesday or Wednesday.

The pre-market scale has the deal maturing serially from 2020 through 2028 with 5% coupons. The 2028 maturity was about 115 basis points above the MMD scale, while the 2028 maturity was about 170 basis points about the scale.

Market sources were optimistic about the deal, though some said that it may be challenging to sell that amount in a single transaction.

“It will definitely need the non-traditional, crossover buyers to come in and support it,” said a source. “I think some institutional foreign investors might come in and be interested in it, but it is shorter-term which [is] another possible kink. I have noticed that has been decent trading volume in Puerto Rico. I am thinking that those people might be looking to replace yield and could buy Illinois.”

The biggest competitive deal on the docket is Washington Suburban Sanitary District's, M.D.’s $493.8 million of consolidated public improvement bonds of 2017. Washington Suburban will also sell $218.8 million of consolidated public improvement refunding bonds of 2017. Both deals carry top ratings of triple-A from Moody’s, S&P and Fitch.

Goldman Sachs is scheduled to price the city of Gainesville, Fla.’s $415.87 million of utility system revenue bonds on Tuesday. The deal is rated Aa3 by Moody’s and AA-minus by S&P and Fitch.

RBC Capital Markets is slated to price the N.Y. Utility Debt Securitization Authority’s $369.47 million of restructuring bonds on Monday. The deal is rated triple-A by Moody’s, S&P and Fitch.

Secondary market
Municipal bonds finished weaker on Friday. The yield on the 10-year benchmark muni general obligation rose three basis points to 1.95% from 1.92% on Thursday, while the 30-year GO yield gained five basis points to 2.74% from 2.69%, according to the final read of Municipal Market Data's triple-A scale.

U.S. Treasuries were weaker on Friday. The yield on the two-year Treasury gained to 1.58% from 1.56%, the 10-year Treasury yield rose to 2.38% from 2.32% and yield on the 30-year Treasury bond increased to 2.89% from 2.83%.

On Friday, the 10-year muni-to-Treasury ratio was calculated at 81.9% compared with 82.7% on Thursday, while the 30-year muni-to-Treasury ratio stood at 94.7% versus 95.1%, according to MMD.

AP-MBIS 10-year muni at 2.263%, 30-year at 2.826%
The Associated Press-MBIS 10-year municipal benchmark 5% general obligation was at 2.263% in late activity on Friday, compared to the final read of 2.254% on Thursday, according to Municipal Bond Information Services, a national consortium of municipal interdealer brokers. The AP-MBIS 30-year muni was at 2.826% versus 2.813% on Thursday.

The AP-MBIS benchmark index is a yield curve built on market data aggregated from MBIS member firms and is updated hourly on the Bond Buyer Data Workstation.

Week's actively traded issues
Some of the most actively traded bonds by type in the week ended Oct. 20 were from California and New York issuers, according to Markit.

In the GO bond sector, the San Diego Unified School District 4s of 2047 were traded 97 times. In the revenue bond sector, the NYC TFA 4s of 2042 were traded 91 times. And in the taxable bond sector, the California 2.5s of 2022 were traded 19 times.

Week's actively quoted issues
Puerto Rico and California names were among the most actively quoted bonds in the week ended Oct. 20, according to Markit.

On the bid side, the Puerto Rico Highway and Transportation Authority revenue 4.75s of 2038 were quoted by 71 unique dealers. On the ask side, the California taxable 7.5s of 2034 were quoted by 100 dealers. And among two-sided quotes, the Puerto Rico Commonwealth GO 8s of 2035 were quoted by 27 unique dealers.

Lipper: Muni bond funds see inflows
Investors in municipal bond funds again put cash back into the funds in the latest week, according to Lipper data released late Thursday.

The weekly reporters saw $536.158 million of inflows in the week of Oct. 18, after inflows of $43.576 million in the previous week.

Exchange traded funds reported inflows of $184.768 million, after inflows of $104.014 million in the previous week. Ex-EFTs, muni funds saw $351.390 million of inflows, after outflows of $60.438 million in the previous week.

The four-week moving average was positive at $204.402 million, after being in the green at $213.857 million in the previous week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.

Long-term muni bond funds had inflows of $424.977 million in the latest week after outflows of $84.362 million in the previous week. Intermediate-term funds had inflows of $164.276 million after inflows of $108.248 million in the prior week.

National funds had inflows of $547.592 million after inflows of $230.791 million in the previous week.

High-yield muni funds reported inflows of $222.947 million in the latest week, after outflows of $93.973 million the previous week.

Data appearing in this article from Municipal Bond Information Services, including the AP-MBIS municipal bond index, is available on the Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Vanessa Kim at 212-803-8474 for more information.

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