The municipal bond market will see a few new deals come to market on Thursday, the biggest of which was added at the last minute.
The Florida State Board of Education announced late on Wednesday it will sell $236.495 million of full faith and credit public education capital outlay refunding bonds in a competitive sale at noon, EST, on Thursday.
The bonds are rated Aa1 by Moody's Investors Service and AAA by Standard & Poor's and Fitch Ratings.
Primary Market
On Wednesday, J.P. Morgan won the city and county of San Francisco, Calif.'s $293.91 million general obligation refunding bonds with a true interest cost of 2.3421%. The bonds were priced to yield from 0.08% with a 2% coupon in 2015 to 2.59% with a 4% coupon in 2030. The bonds are rated Aa1 by Moody's, AA-plus by S&P and AA by Fitch.
Elsewhere, Morgan Stanley received the official award on the $121.345 million Glendale, Ariz., senior lien water and sewer revenue refunding obligations. The bonds were priced to yield from 0.83% with a 4% coupon in 2018 to 2.54% with a 5% coupon in 2028. The issue is rated A1 by Moody's and AA by S&P.
Also, Citigroup Global Markets priced the $386.845 million Kentucky State Property and Building Commission bonds in two series. The $132.095 million of new money revenue bonds, Project No. 108 Series A, were priced with a top yield of 2.97% in 2034 while the $254.75 million of refunding revenue bonds, Project No. 108 Series B, were priced with a top yield of 2.49% in 2026. Both series are rated Aa3 by Moody's and A-plus by S&P and Fitch.
Secondary Market
Treasury prices were mostly lower on Thursday, with the two-year note yield rising to 0.52% from 0.49% on Wednesday. The 10-year yield rose to 1.74% from 1.73%, while the 30-year yield was unchanged at 2.32%.
Prices of top-rated munis were stronger on Wednesday. The yield on the 10-year benchmark general obligation fell three basis points to 1.75% from 1.78% on Tuesday, while the yield on 30-year GOs fell three basis points to 2.54% from 2.57%, according to the final read of MMD's triple-A benchmark scale.
On Wednesday, the 10-year muni to Treasury ratio increased to 101.7% from 97.8% on Tuesday, while the 30-year muni to Treasury ratio rose to 110.9% from 107.1%
MSRB Reports Previous Session's Activity
The Municipal Securities Rulemaking Board reported 36,331 trades on Wednesday on volume of $12.591 billion.
Most active on Wednesday, based on the number of trades, was the New York City Transitional Finance Authority, 2015 Series S-1 Building Aid revenue bond 3 1/8s of 2032, which traded 55 times with an average price of 101.406 and an average yield of 2.961%.
