NEW YORK – It has come down to the last minute for traders looking for bonds during the final trading session of 2011.
“People are looking for bonds but not paying list prices,” said a trader in New York. “They are not being aggressive and there is no bid side, but they are throwing out some bids to see if anyone bites.”
Munis were flat to firmer in Friday morning trading. Yields inside the five-year were steady while the six-year to nine-year yields fell between one and three basis points. The 10-year yield fell two basis points while yields outside 11-year fell one basis point.
On Thursday, the 10-year muni yield fell one basis point to 1.86%, to set a record low as recorded by Municipal Market Data. Thursday’s record broke the previous record of 1.87% set Wednesday and the 1.91% record set the week before Christmas.
The two-year yield closed flat at 0.36% for its 16th consecutive trading session. The 30-year yield dropped two basis points to 3.56%.
Treasuries strengthened Friday morning. The two-year yield fell two basis points to 0.26%. The benchmark 10-year yield and 30-year yield each fell four basis points to 1.86% and 2.87%, respectively.
Looking ahead to next week’s calendar, RBC Capital Markets is expected to issue $171 million of Texas Tech University System Board of Regents bonds Thursday.
On the competitive calendar, the largest deals will come Thursday with New York’s Suffolk County Water Authority issuing $83.64 million of revenue bonds. The credit is rated AA-plus by Standard & Poor’s.
Also on Thursday, Texas A&M University System Board of Regents will issue $65 million of bonds.
