Prices of top-rated municipal bonds were unchanged at mid-session, as yields remained flat even as Treasury prices moved lower. Participants are keeping an eye on yields after they reversed course and began rising on Monday.
Primary Market
The primary market was relatively quiet on Thursday after Trinity Health pushed back its planned sale of $1.1 billion of tax-exempt hospital revenue bonds amid this week's rising yields and shifted it to the day-to-day calendar until the market stabilizes. The borrowing would have been one of the largest to hit the market this week.
The Michigan-based provider was set to price the tax-exempt bonds on Feb. 3 and $350 million taxable bonds on Feb. 5 or 6. The marketing team decided to shift the tax-exempt piece to the day-to-day calendar as borrowing rates rose.
The taxable piece could still sell as early as Thursday, according to Mark Melio of Melio & Co., Trinity's financial advisor.
Secondary Market
At midday, the yield on the muni 10-year benchmark general obligation was unchanged from 1.84% on Wednesday, while the yield on 30-year GOs was flat at 2.64%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were lower on Thursday. The two-year note yield rose to 0.52% from 0.51% on Tuesday; the 10-year yield increased to 1.82% from 1.79%, while the 30-year yield rose to 2.42% from 2.38%.
The 10-year muni to Treasury ratio increased to 102.8% on Wednesday from 101.1% on Tuesday, while the 30-year muni to Treasury ratio rose to 110.9% from 109.3%.
MSRB Reports Previous Session's Activity
The Municipal Securities Rulemaking Board reported 38,458 trades on Wednesday on volume of $13.490 billion.
Most active on Wednesday, based on the number of trades, was the New Jersey State Transportation Trust Fund Authority Series AA transportation program 4 1/4s of 2044, which traded 103 times with an average price of 103.547 and an average yield of 3.796%.
Caitlin Devitt contributed to this report
