The tax-exempt market traded softer Tuesday morning ahead of some big deals in the primary market as traders said bid lists surfaced early.
"There is a little selling pressure," a New York trader said. "Ratios are a little tighter and maybe there is a little selling in sympathy there and people trying to cheapen up the market for the new deals. But overall it's a very quiet week in the negotiated."
The biggest deal Tuesday is expected to price in the competitive market with Louisiana auctioning $300 million of general obligation bonds in two pricings. The bonds are rated Aa2 by Moody's Investors Service and AA by Standard & Poor's and Fitch Ratings. The sale consists of $130.7 million and $169.3 million.
Elsewhere in the primary market, Loop Capital Markets is expected to price $190 million of Houston Combined Utility System first lien revenue and refunding bonds, rated Aa2 by Moody's and AA by Standard & Poor's.
Morgan Stanley is expected to price $152.4 million of Illinois Finance Authority revenue bonds for the University of Chicago, rated Aa1 by Moody's, AA by Standard & Poor's, and AA-plus by Fitch.
Citi is expected to price $147 million of Maryland Health and Higher Educational Facilities Authority revenue Medstar Health issue bonds, rated A2 by Moody's, A-minus by Standard & Poor's, and A by Fitch.
Municipal bond scaled ended up to six basis points weaker Monday after posting losses Friday.
Yields on the Municipal Market Data triple-A GO scale finished as much as six basis points higher. The 10-year and 30-year yields jumped five basis points each to 1.73% and 2.87%, respectively. The two-year finished flat at 0.29% for the 22nd session.
Yields on the Municipal Market Advisors 5% scale ended as much as five basis points higher. The 10-year and 30-year yields increased three basis points each to 1.79% and 3.01%, respectively. The two-year finished unchanged at 0.32% for the 22nd session.
Treasuries were slightly weaker Tuesday morning for the second session this week. The benchmark 10-year and 30-year yields increased one basis point each to 1.78% and 2.99%, respectively. The two-year also rose one basis point to 0.23%.