The municipal bond market will see a variety of pricings and sales in the primary. About $12 billion in new bonds are scheduled to come to market this week, most of which are set for sale on Tuesday and Wednesday.
Tuesday's Primary
California's Bay Area Toll Authority will bring $731 million of revenue debt to market. Bank of America Merrill Lynch will price $431 million of San Francisco Bay Area toll revenue senior lien bonds structured as Series D and Series 3 term-rate bonds, and Series G and H index-rate bonds. The bonds are rated Aa3 by Moody's Investors Service, AA by Standard & Poor's, and AA-minus by Fitch Ratings. The $300 million subordinate toll bridge revenue bonds in Series S6 will be priced by Citigroup Global Markets and are structured as a 2054 bullet maturity and rated A1 by Moody's and A-plus by S&P.
Bank of America Merrill Lynch is slated to price the California Statewide Communities Development Authority's $650 million tax-exempt and taxable bonds for the Loma Linda University Medical Center. The deal is rated BBB by S&P and BBB-minus by Fitch and will be priced with a structure consisting of $550 million of 2014 A tax-exempt debt and $100 million of 2014 B taxable bonds.
Morgan Stanley is set to price the Harris County-Houston Sports Authority's $569 million tax-exempt and taxable senior lien revenue refunding bonds and second lien revenue refunding bonds. Series 2014 A totals $458.43 million of tax-exempt senior lien revenue refunding bonds, while Series 2014 B consists of $33.19 of taxable senior lien revenue refunding bonds. Series 2014 C is comprised of $77.28 million of second lien revenue refunding debt. Series 2014 A and B are rated A2 by Moody's and A-minus by S&P and Series 2014 C is rated A3 by Moody's and BBB by S&P.
Wells Fargo Securities is set to price Dallas' $530 million general obligation and refunding bonds. The bonds are rated Aa1 by Moody's and AA-plus by S&P and are structured as serial bonds maturing from 2015 to 2034.
Bank of America Merrill Lynch will price $412 million Northeast Ohio Regional Sewer District wastewater improvement revenue and refunding bonds. The bonds are rated Aa1 by Moody's and AA-plus by S&P.
JPMorgan Securities will price New York City Housing Development Corp.'s $344 million fixed-rate revenue bonds, structured as serial bonds maturing from 2015 to 2048. The issue is rated Aa2 by Moody's and AA-plus by S&P.
Secondary Market
Treasury yields were lower on Tuesday with the two-year note yield declining to 0.60% from 0.63% on Monday. The 10-year yield dropped to 2.22% from 2.25% while the 30-year decreased to 2.87% from 2.90% on Monday.
On Monday, high-grade municipal bond yields fell. The yield on the benchmark 10-year general obligation lost two basis points to 2.07% from 2.09% at Friday's close while the yield on 30-year GOs dropped four basis points to 2.96% from 3.00% on Friday, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni-to-Treasury ratio closed on Monday at 91.7% versus 90.6% on Friday; the 30-year muni to Treasury ratio closed at 102.0%, compared with 101.2% on Friday.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 33,772 trades on Monday for volume of $7.444 billion.
Most active on Monday, based on the number of trades, was the New Jersey Transportation Trust Fund Authority transportation program bonds, Series AA 4 1/4s of 2044, which traded 155 times with an average price of 99.639 and an average yield of 4.256%.
