Municipal market participants continue to hold off in preparation for the large new-issue calendar.
A quiet market opening has lingered into the early afternoon, traders said, marked by sparse retail activity. An uncertain and vacationing investor base is waiting for the week's bigger deals to arrive.
Yields appear steady, a trader in Chicago said. Most will try to get the new deals priced cheap to go away, which should find wide support in the marketplace, he added.
"It seems like really not much of an environment for secondary trading," he said, "especially since you're not going to buy some of the retread blocks that have been sitting around out there."
This week, an estimated $9.65 billion of new volume is expected to price, Ipreo LLC and The Bond Buyer report. This represents an increase from a revised $5.38 billion that arrived last week, according to Thomson Reuters. In the pole position sits a $2.9 billion Texas transportation deal expected from the Grand Parkway Transportation Corporation.
Piper Jaffray held a second day of retail on $228 million of University of Connecticut general obligation bonds. The bonds were rated Aa3 by Moody's Investors Service, AA by Standard & Poor's, and AA-minus by Fitch Ratings.
Yields on the first series of $174.2 million ranged from 0.50% with a 3% coupon in 2015 to 4.32% with a 4.25% coupon in 2033. Bonds maturing in 2014, 2030 and 2032 were not offered for retail. The bonds are callable at par in 2023.
Yields were lowered as much four basis points at five and six-years, and one or two basis points at the short and far ends the curve.
Yields on the second series of $53.9 million ranged from 0.40% with a 3% coupon in 2015 to 3.13% with a 4% coupon in 2024. Bonds maturing in 2014 were not offered for retail. The bonds are callable at par in 2023.
Yields were lowered as much as five basis points. Institutional pricing should be held Tuesday.
Tax-exempt yields mid-Monday are mostly steady across the curve, according to one market gauge. They're up to two basis points lower at six and seven years.
On Friday, the 10-year and 30-year yields slid one basis point each to 2.66% and 4.00%, respectively. The two-year was steady at 0.45% for the second session, according to the Municipal Market Data scale read.
Yields on the Municipal Market Advisors scale ended as much as three basis points lower Friday. The 10-year and 30-year yields slipped one basis point each to 2.84% and 4.11%, respectively. The two-year was steady at 0.54% for the second session.
Treasuries crossed into the afternoon a tad stronger. The benchmark 10-year yield has fallen two basis points to 2.57%. The two-year and 30-year yields have both slipped one basis point 0.34% and 3.63%, respectively.