The municipal bond market posted gains Thursday afternoon, following Treasuries, and yields fell across the curve.

Traders said new issue supply was received well and bonds were subsequently trading up in the secondary.

"You see that 10-year Treasury? Everyone was calling for higher rates and look where we are now," a New Jersey trader said. "There is very little supply here right now and institutions are loaded with cash. There is still not a lot of retail, especially on the front end of the curve."

The combination of firmer Treasuries and little supply pushed munis higher. "We are definitely better today," he said. "At least three to five basis points 19 years and out."

In the remainder of the primary market, Wells Fargo Securities priced $345.3 million of Charleston Educational Excellence Financing Corp. installment purchase revenue refunding bonds on behalf of the Charleston County School District. The bonds are rated Aa3 by Moody's Investors Service and AA by Standard & Poor's.

Yields ranged from 1.27% with a 2% coupon in 2018 to 3.18% with a 5% coupon in 2030. The bonds are callable at par in 2023.

JPMorgan priced for institutions $137.9 million of Pennsylvania Housing Finance Agency single family mortgage revenue bonds followed a retail order period Wednesday. The bonds are rated Aa2 by Moody's and AA-plus by Standard & Poor's.

The first series of $127.9 million of bonds subject to the alternative minimum tax were priced at par with 0.20% and 0.65% coupons in a split 2014 maturity to a 4.35% coupon in 2035. The bonds are callable at par in 2022. Coupons were lowered as much as five basis points from retail pricing.

The second series of $10 million, not subject to the alternative minimum tax, was priced at par with a 4% coupon in 2038 and a 4.10% coupon in 2043. The bonds are callable at par in 2022. The coupon on the 2043 maturity was lowered five basis points from retail pricing Wednesday.

Municipal bond scales ended as much as three basis points firmer Wednesday in a mixed week so far. Munis posted gains Monday and were weaker Tuesday.

Yields on the Municipal Market Data triple-A GO scale ended as much as three basis points lower. The 10-year yield fell three basis points to 1.86% and the 30-year yield slid two basis points to 3.07%. The two-year finished flat at 0.31% for the 31st consecutive session.

Yields on the Municipal Market Advisors 5% coupon triple-A benchmark scale also ended as much as three basis points lower. The 10-year yield dropped three basis points to 1.92% and the 30-year yield fell two basis points to 3.17%. The two-year held at 0.33% for the 26th session.

Treasuries continued to gain Thursday afternoon. The benchmark 10-year yield slid four basis points to 1.77% while the 30-year yield dropped five basis points to 3.00%. The two-year was steady at 0.23%.

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