Trading in the tax-exempt market continued to stay quiet with a few bonds in the secondary trading stronger from where they priced in the primary market last week.
Block size trades of Jefferson County, Ala., sewer debt traded firmer as Monday progressed. It was also firmer from where the deal priced last week. “Jefferson County came at an attractive price and if you get past the credit, I’d imagine people will look at it like an attractive piece of paper,” a New Jersey trader said.” The sewer debt was one of the most actively traded securities as of Monday afternoon. A customer bought from a dealer one CUSIP of senior lien sewer revenue convertible capital appreciation 0s of 2038 at 6.33%, down from 6.38% in the morning. Yields were also lower from where a customer bought the bonds on Friday at 6.40% in block size trading. In the general market, activity remained subdued. “We are not seeing a whole lot of change here,” the New Jersey trader said. “It might be a little firmer but there is not a lot of activity. After Tuesday, the market will virtually be shut down.” According to Municipal Securities Rulemaking Board data, volume fell 15% from the average of the past five Monday trading sessions to $2.9 billion. Dealers sold to customers $1.2 billion while dealers bought $927.2 million from customers. Interdealer trading accounted for 28.1% of volume at $816.4 million. On Friday, the triple-A Municipal Market Data scale ended as much as two basis points stronger after weakening for two straight sessions. The 30-year yield fell two basis points to 4.14%. The 10-year was steady for the second session at 2.66% and the two-year closed unchanged for the seventh session at 0.33%. Yields on the Municipal Market Advisors benchmark scale ended mostly unchanged. The 10-year and 30-year yields were flat at 2.72% and 4.37%, respectively. The two-year was steady for the fifth session at 0.38%. Treasuries were mostly stronger on the long end. The benchmark 10-year and 30-year yields fell one basis point each to 2.74% and 3.83%, respectively. The two-year was steady at 0.30%.