Traders and other market participants are eagerly awaiting the first sales from the hefty $12.7 billion calendar, which should pair nicely with continued strong demand from investors.
Secondary Market
U.S. Treasuries were weaker on Monday morning. The yield on the two-year Treasury rose to 0.80% from 0.78% on Friday, while the 10-year Treasury yield increased to 1.72% from 1.70% and the yield on the 30-year Treasury bond gained to 2.53% from 2.52%.
Top-shelf municipal bonds were mostly higher on Friday. The yield on 10-year benchmark muni general obligation was four basis points lower to 1.62% from 1.66% on Thursday, while the 30-year muni yield was three basis points lower to 2.40% from 2.43% on Thursday, according to a final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated at 95.1% on Friday compared to 91.8% on Thursday, while the 30-year muni to Treasury ratio stood at 95.3% versus 94.0%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 33,702 trades on Friday on volume of $13.90 billion.
Prior Week's Actively Traded Issues
Revenue bonds comprised 52.19% of new issuance in the week ended June 3, down from 53.06% in the previous week, according to data released by Markit.
General obligation bonds comprised 40.94% of total issuance, up from 39.99%, while taxable bonds made up 6.87%, down from 6.95%.
Some of the most actively traded issues by type in the week ended June 3 were from Massachusetts and New York issuers. In the GO bond sector, the Massachusetts Educational Financing Authority 3.5s of 2033 were traded 29 times. In the revenue bond sector, the Dormitory Authority of the State of New York 4s of 2043 were traded 37 times. And in the taxable bond sector, the Dormitory Authority of the State of New York 3.879s of 2046 were traded 66 times, Markit said.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Citigroup, Morgan Stanley, Bank of America Merrill Lynch, Wells Fargo Securities and RBC Capital Markets, according to Thomson Reuters data. In the week of May 29-June 4, Citi underwrote $1.45 billion, Morgan Stanley did $837.7 million, BAML had $367.7 million, Wells Fargo did $326.4 million and RBC had $238.7 million.
Primary Market
Total volume for the coming week is estimated by Ipreo at $12.71 billion, more than three times the revised total of $3.95 billion in the past holiday shortened week, according to Thomson Reuters data. The calendar includes $7.29 billion of negotiated deals and $5.42 billion of competitive sales. IPreo's calendar on Thursday showed more than $6 billion of competitive deals on tap.
On Tuesday, Georgia will competitively sell about $1.37 billion of bonds in five separate offerings. The deals include $382 million of Series 2016C-1 and C-2 general obligation refunding bonds, $362 million of Series 2016A Tranche 1 GOs, $356 million of Series 2016A Tranche 2 GOs, $200 million of Series 2016B taxable GOs, and $68 million of Series 2016D taxable refunding GOs.
In the negotiated arena, the preliminary slate is topped by the New York Transportation Development Corp.'s $850 million of special facility revenue refunding AMT bonds for the American Airlines JFK Project, expected on Tuesday.
Also on Tuesday, the Greater Chicago Metropolitan Water District's $432 million of Series A, B, C, D, E, F GO green bonds will be priced by Bank of America Merrill Lynch. The deal is rated AA-plus by S&P Global Ratings and triple-A by Fitch Ratings.
JP Morgan is expected to price the District of Columbia's $422 million of Series 2016A of GO bonds. It is anticipated that the deal will mature serially from 2018-2036 as well as feature a CAB in 2041. The deal is rated Aa1 by Moody's Investors Service and AA by both S&P and Fitch.
Barclays Capital is scheduled to price Pennsylvania State University's $349.270 million of Series 2016B refunding bonds. The deal is rated Aa1 by Moody's and AA by S&P.
