Bids continued to surface in the tax-exempt market Tuesday afternoon as sellers looked to purge bonds, though traders cautioned the bids didn't necessarily turn into actual trades.
"It's pretty brutal for the month of June," a New York trader said. "I just walked in this morning and Treasuries were down nicely and that continued to set tone for munis. People are just waiting to for guidance and for things to settle in before they jump back in."
This trader added there was a "decent amount" of bid-wanteds from all types of investors. Dealers are providing swap trades more than liquidity.
In the primary market, Loop Capital Markets held a second retail pricing of $800 million New York City Transitional Finance Authority future tax secured subordinate bonds. The TFA bonds are rated Aa1 by Moody's Investors Service and triple-A by Standard & Poor's and Fitch Ratings. In the first retail pricing Monday, $167 million orders were placed.
In the second retail pricing Tuesday, yields ranged from 0.63% with 3% and 4% coupons in a split 2016 maturity to 4.15% with a 4% coupon in 2043. Credits maturing in 2015 were offered in a sealed bid. Bonds maturing in 2030, 2031, 2032, 2038, and 2042 were not offered for retail. The bonds are callable at par in 2023.
Yields were raised as much as 10 basis points from the first retail pricing.
Barclays priced $600 million of Build Illinois Bonds. The sales tax revenue bonds are rated AAA by Standard & Poor's and AA-plus by Fitch.
Yields ranged from 0.50% with a 4% coupon in 2015 to 3.43% with a 5% coupon in 2026. Bonds maturing in 2014 were offered via sealed bid. The bonds are callable at par in 2023.
In the competitive market, Alabama Public School and College Authority auctioned $175 million of revenue bonds, rated Aa1 by Moody's, AA by Standard & Poor's, and AA-plus by Fitch, in two pricings.
Bank of America Merrill Lynch won the bid on $119.1 million of capital improvement pool bonds. Yields ranged from 0.44% with a 5% coupon in 2014 to 4.18% with a 4% coupon in 2033. The bonds are callable at par in 2023.
B of A Merrill won the bid on $55.92 million. Yields ranged from 0.44% with a 4% coupon in 2014 to 4.18% with a 4% coupon in 2033. The bonds are callable at par in 2023.
Monday, yields on the Municipal Market Data scale ended as much as seven basis points higher. The triple-A 10-year yield rose six basis points to 2.19% and the 30-year yield vaulted seven basis points to 3.41%. The two-year was unchanged at 0.30% for the sixth session.
Muni yields on the Municipal Market Advisors 5% scale closed out as much as six basis points higher. The 10-year yield climbed five basis points to 2.25% and the 30-year yield jumped five basis points to 3.51%. The two-year ticked up one basis point to 0.37%.
The Treasury yield curve flattened Tuesday afternoon. The two-year and benchmark 10-year yield rose one basis point each to 0.34% and 2.22%, respectively. The 30-year yield fell two basis points to 3.35%.
