The tax-exempt market ended Tuesday on a slightly weaker note after three consecutive steady to firmer trading sessions.
Market participants said trading picked up a bit from Monday, though overall activity felt subdued.
“There is not much going on,” a New York trader said. “It’s par for the course as per the last few days. It’s about steady to weaker and moving very conservative.”
“Munis are quiet but weaker by a few basis points,” a second New York trader said. “Treasuries are down and equities are up. The focus is not on munis right now.”
In the primary market, Bank of America Merrill Lynch priced $273.3 million of Arizona Health Facilities Authority bonds for the Phoenix Children’s Hospital in three pricings. The bonds are rated BBB-plus by Standard & Poor’s.
The first pricing of $150 million were variable rate revenue refunding bonds. Both series of $75 million each were priced 185 basis points above the SIFMA index maturing in 2048 with a mandatory tender date in 2020. The bonds are callable at par in 2019.
The second pricing of $75 million were variable rate revenue refunding bonds. Both series of $37.5 million each were priced 185 basis points above the SIFMA index maturing in 2058 with a mandatory tender date of 2023. The bonds are callable at par in 2022.
Yields on the third pricing of $48.3 million ranged from 2.65% with a 3% coupon in 2021 to 4.17% with a 5% coupon in 2048. The bonds are callable at par in 2023.
Goldman, Sachs & Co. priced $260.4 million of Wisconsin transportation revenue bonds, rated Aa2 by Moody’s Investors Service and AA-plus by Standard & Poor’s and Fitch Ratings. The deal was expected to price last week and was postponed due to market conditions.
Yields ranged from 0.60% with a 4% coupon in 2016 to 3.04% with a 4% coupon and 2.84% with a 5% coupon in a split 2033 maturity. The bonds are callable at par in 2023.
Barclays priced $196.9 million of Phoenix Civic Improvement Corporation senior lien airport revenue refunding bonds, subject to the alternative minimum tax. The bonds are rated Aa3 by Moody’s Investors Service and AA-minus by Standard & Poor’s.
Yields ranged from 0.67% with a 4% coupon in 2015 to 3.27% with a 5% coupon in 2032. Bonds maturing in 2014 were offered via sealed bid. The bonds are callable at par in 2023.
In the competitive market, triple-A rated Prince George’s County in Maryland auctioned $340.2 million of general obligation consolidated public improvement refunding bonds in two pricings.
Bank of America Merrill Lynch won the bid for the first series of $202.6 million. Yields ranged from 0.20% with a 3% coupon in 2014 to 2.92% with a 3% coupon in 2028. The bonds are callable at par in 2023.
Citi won the bid for the second series of $137.6 million. Yields ranged from 0.19% with a 2% coupon in 2014 to 3.05% with a 3% coupon in 2033. The bonds are callable at par in 2023.
In the secondary market, trades compiled by data provider Markit showed mostly weakening.
Yields on Arizona Transportation Board 5s of 2025 jumped five basis points to 2.32% while Central Lake County, Ill., Join Action Water Agency 4s of 2019 spiked up four basis points to 1.49%.
Yields on Indiana State Finance Authority 5s of 2028 rose three basis points to 2.84% while Massachusetts School Building Authority 5s of 2025 increased two basis points to 2.25%.
Yields on California Health Facilities Authority 5s of 2040 and New Jersey Transportation Trust Fund Authority 5.754s of 2028 rose two basis points each to 3.18% and 4.12%, respectively.
Municipal bond market reads showed small losses after three sessions of steady to firmer gains.
Yields on the Municipal Market Data triple-A GO scale finished steady to one basis point higher. The 30-year yield rose one basis point to 2.86%. The 10-year yield finished flat at 1.81% while the two-year held steady at 0.34% for the seventh session.
The Municipal Market Advisors 5% coupon triple-A benchmark scale also showed steady to higher yields. The 30-year yield increased one basis point to 2.95%. The 10-year yield held steady at 1.84% for the fifth consecutive trading session while the two-year closed unchanged at 0.35% for the seventh session.
Treasuries finished weaker Tuesday. The benchmark 10-year yield and the 30-year yield jumped four basis points each to 2.01% and 3.21%, respectively. The two-year yield increased one basis point to 0.27%.