NEW YORK – The tax-exempt market was firmer Wednesday morning as buyers seemed eager to eat up leftovers from the year.
Still, some traders noted it was a relatively quiet week overall.
“It’s very quiet,” said a trader in New York. “Half of my sales coverage has a ‘red dot’ next to their names on Bloomberg.”
“It is a trade-by-appointment week,” he added. “The lack of new issues does support the bid-side somewhat, even though it’s pretty thin, but I wouldn’t want to be the guy that suddenly has a portfolio to liquidate before year-end.”
Munis were flat to firmer in morning trading, according to the Municipal Market Data scale. Yields were steady within the five-year and fell two basis points on the long end.
On Tuesday, the two-year yield closed flat at 0.36% for its 14th consecutive trading session. The benchmark 10-year yield held at a record low 1.91%, as recorded by MMD last week. The 30-year muni yield remained flat at 3.63%.
Treasuries were firmer across the curve. The two-year yield fell one basis point to 0.29%. The benchmark 10-year yield and the 30-year yield fell five basis points each to 1.97% and 2.99%, respectively.
While the primary market is mostly shut down for the week, the secondary market is trying to take over. Indeed, trades reported by the Municipal Securities Rulemaking Board showed firming.
Bonds from an interdealer trade of New York Liberty Development Corp. 5s of 2041 yielded 4.21%, eight basis points lower than where they traded last week.
A dealer bought from a customer New York City Municipal Finance Authority 5s of 2044 at 4.13%, four basis points lower than where they traded last week.
A dealer sold to a customer Virginia Public School Authority 5s of 2022 at 2.26%, two basis points lower than where they traded the previous week.
Bonds from an interdealer trade of Detroit Water Supply 5.25s of 2041 yielded 5.26%, two basis points lower than where they traded last week.
One deal was added to Thursday’s competitive calendar: $299 million Municipal Electric Authority of Georgia revenue bonds.
