The tax-exempt market was stronger for the ninth session Friday as traders said the muni rally was unstoppable.

The municipal bond market climbed for two consecutive weeks and said the rally could likely continue ahead of Thanksgiving.

“It doesn’t look like there is an end in sight,” a Texas trader said. “Zeros are starting to move. It’s the place where people can get yield without sacrificing duration or quality. The market has moved so much it’s hard to find anything with real value in it.”

He added some people are in disbelief about the low levels of yields right now. “People are looking at new issue scales and scratching their heads and then seeing the follow through in the secondary and saying I guess these levels are right.”

This trader added the market was taking a small breather Friday afternoon. “We’ve been focusing on finding things to buy,” he said. “So I’d definitely say it’s slower today and it’s a good day to catch your breath. Next week should be slower too.”

Other traders had the same reaction. “Munis feel like they can’t be stopped,” wrote Dan Toboja at Ziegler Capital Markets. “Demand was extremely solid and new issues were again scooped up.”

Looking to holiday-shortened trading week due to Thanksgiving, Toboja said the market is expected to be quiet. “Next week is holiday-shortened again and the new issue calendar shows it. Away from the $1 billion [Texas Municipal Gas Acquisition and Supply Corp.] deal slated there is little in the way of issuance. With only a fraction of normal supply and higher-than-average demand the market has not backed off these low yields.”

“Most likely there won’t be any kind of selloff prior to the Thanksgiving holiday, but supply is unusually anemic for Q4; whether or not that continues remains to be seen,” he added.

The Municipal Market Data scale set new record low yields with each passing day throughout the week. On Friday, the 10-year yield dropped one basis point to a new record low of 1.50%, beating the previous record of 1.51% set Thursday. Before that, the MMD record was 1.54% set Wednesday and the 1.55% set Tuesday.

The 30-year MMD yield also fell one basis point to 2.54%, setting a new record low. The previous record was 2.55% set Thursday and before that, 2.60% set Wednesday and 2.64% set Tuesday.

The two-year finished steady at 0.30% for the 36th consecutive trading session.

Treasuries were mostly steady Friday. The two-year and benchmark 10-year yields were flat at 0.24% and 1.58%, respectively. The 30-year yield rose one basis point to 2.73%.

Since Hurricane Sandy, municipal bonds have been on a tear, with yields falling to record lows. Investment grade municipals bonds have moved up 1.19% since the hurricane and have returned 7.74% year-to-date as measured by the S&P National AMT-Free Municipal Bond Index. Similarly, high-yield municipals have experienced demand, with a tax-exempt yield of 5.62% or a taxable equivalent yield of 8.65% as measured by the S&P Municipal Bond High Yield Index.

JR Rieger, vice president of fixed income indices at Standard & Poor’s Down Jones Indices, noted high-yield municipal bonds have fallen nine basis points over the last week while high-yield corporate bonds have seen prices fall and yields rise by 25 basis points for the same time period.

“High yield municipal bonds remain attractive in relative terms to high yield corporate bonds which are yielding a taxable 6.74%,” he said, adding high-yield munis have returned 16.96% year-to-date while high-yield corporates have returned only 12.21%.

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