The municipal bond market on Thursday was awaiting the pricing of the last of the week's large new issues. On Wednesday, top-shelf municipal bond yields moved higher as a slew of new issues came to market.
Secondary Market
Treasury prices were little changed on Thursday. The yield on the two-year Treasury note remained at 0.53% from Wednesday, while the 10-year yield was flat at 1.90% and the 30-year yield slipped to 2.52% from 2.53%.
Prices of top-quality munis closed lower on Wednesday. The yield on the 10-year benchmark muni general obligation rose two basis points to 1.94% from 1.92% on Tuesday , while the yield on 30-year GO was up by one basis point to 2.81% from 2.80%, according to the final read of MMD's triple-A scale.
On Wednesday, the 10-year muni to Treasury ratio was calculated at 102.4% versus 101.5% on Tuesday, while the 30-year muni to Treasury ratio stood at 111.6% compared to 110.8%.
Primary Market
Morgan Stanley on Wednesday priced the New York State Dormitory Authority's $682.73 million of Series 2015A revenue bonds for retail investors ahead of the institutional pricing on Thursday.
The DASNY deal was priced for retail to yield from 0.70% with a 3% coupon in 2017 to 3.00% with a 5% coupon in 2035. A 2038 term bond was priced as 4s to yield 3.47%; a 2041 term bond was priced at par to yield 2.50%; a 2045 term bond was priced as 5s to yield 3.15% and a 2048 term bond was priced as 5s to yield 3.32%. The 2016 maturity was offered as a sealed bid.
Morgan Stanley is expected on Thursday to price DASNY's $265.97 million of Series 2015B taxable revenue bonds for NYU. All the NYU bonds are rated Aa3 by Moody's Investors Service and AA-minus by Standard & Poor's.
On Wednesday, JPMorgan priced the North Texas Tollway Authority's Series 2015A system second tier revenue refunding bonds to yield from 0.43% with a 2% coupon in 2016 to 3.58% with a 5% coupon in 2035. A 2038 term bond was priced as 4s to yield 4.07%. The deal was rated A3 by Moody's and BBB-plus by S&P.
Tax-Exempt Money Market Funds Post Outflow
Tax-exempt money market funds had an outflow of $1.84 billion, bringing total net assets to $259.50 billion in the period ended April 6, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $521.6 million to $259.47 billion in the previous week.
The average, seven-day simple yield for the 396 weekly reporting tax-exempt funds remained at 0.01% for a 101st straight week.
The total net assets of the 991 weekly reporting taxable money funds fell $6.76 billion to $2.412 trillion in the period ended April 7, after experiencing an outflow of $42.55 billion to $2.418 trillion in the prior week.
The average, seven-day simple yield for the taxable money funds remained at 0.02% for the 11th consecutive week.
Overall, the combined total net assets of the 1,387 weekly reporting money funds decreased $4.92 billion to $2.671 trillion in the period ended April 7, which followed an inflow of $44.36 billion to $2.676 trillion in the prior period.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $2.514 billion to $8.611 billion on Wednesday. The total is comprised of $4.139 billion competitive sales and $4.472 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 40,277 trades on Wednesday on volume of $9.705 billion.
Most active, based on the number of trades, was the Knoxville, Tenn., Series 2015A water system revenue refunding 3 1/2s of 2040, which traded 88 times at an average price of 99.791 with an average yield of 3.505%. The bonds were initially priced at 98.00 to yield 3.622%.
