The municipal bond market is awaiting the first of the week’s large new issue slate to hit the screens, lead on Tuesday by a Massachusetts deal and a competitive offering from Seattle, Wash.
Elsewhere, Wayne County, Mich., Deputy Treasurer Christa McLellan said that Thursday was the target date for the county’s sale of $186.9 million of delinquent tax anticipation notes.
The deal was postponed from last week after County Executive Warren Evans asked for state fiscal intervention to help it fix its financial problems.
The delinquent tax anticipation notes are set to be priced by Bank of America Merrill Lynch. Public Financial Management is municipal advisor and Axe & Ecklund is note counsel. The county also obtained the services of Orrick, Herrington & Sutcliffe as special bankruptcy counsel.
Primary Market
Treasury prices were lower on Tuesday with the yield on the two-year Treasury note rising to 0.68% from 0.65% on Monday, while the 10-year yield gained to 2.41% from 2.35% and the 30-year yield increased to 3.21% from 3.15%.
On Monday, the yield on the 10-year benchmark muni general obligation closed up two basis points to 2.29% from 2.27% on Friday, while the yield on the 30-year GO rose two basis points to 3.28% from 3.26%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Monday at 97.0% versus 101.3% on Friday, while the 30-year muni to Treasury ratio stood at 104.1% compared to 106.2%, according to MMD.
Primary Market
Bank of America Merrill Lynch is slated to price the Massachusetts GOs, consolidated loan of 2015, as Series C refunding bonds and Series
Siebert Brandford and Shank on Monday priced for retail the New York State Environmental Facilities Corp.’s $216.87 million of Series
The issue was priced to yield from 1.03% with a 3% coupon in 2018 to 3.43% with a 5% coupon in 2045. No retail orders were taken in the 2031 to 2034, 2036 to 2039 or 2041 to 2044 maturities. The 2016 and 2017 maturities were offered as sealed bids.
The bonds are rated triple-A by Moody's and S&P and AA-plus by Fitch.
Also on Tuesday, Citi is expected to price the Philadelphia Authority for Industrial Development's $273 million of revenue bonds for Temple University. The bonds are rated Aa3 by Moody's and A-plus by S&P.
The largest sale on the competitive calendar is Tuesday's offering from Seattle, Wash. The city is selling $164 million of Series
The last time the city competitively sold comparable bonds was on Oct. 22, 2014 when Wells Fargo Securities won $265.21 million of Series 2014 municipal light and power improvement and refunding revenue bonds with a true interest cost of 3.096%.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 33,654 trades on Monday on volume of $6.554 billion.
The most active bond, based on the number of trades, was the Missouri State Environmental Improvement and Energy Resources Authority’s Series 2015 water facilities revenue bonds for the Tri-County Water Authority project 4s of 2036, which traded 91 times at an average price of 100.651 with an average yield of 3.914%. The bonds were initially priced at 98.759 to yield 4.09%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $284.0 million to $12.14 billion on Tuesday. The total is comprised of $2.68 billion competitive sales and $9.47 billion of negotiated deals.
