The tax-exempt market showed signs of slowing as the majority of deals expected in the primary market had been priced. Munis held a flat tone despite weaker Treasuries.
"The market is kind of boring," a New York trader said. "It's doing a little. But maybe a touch down."
Still, the Municipal Market Data scale showed munis were steady to firmer. Yields inside 12 years fell one basis point. Yields outside 13 years were flat.
On Wednesday, the 10-year and 30-year yields each closed down one basis point to set record lows. The 10-year closed at 1.61%, breaking the previous record of 1.62% set Tuesday. The 30-year yield ended the day at 2.79%, breaking the previous record of 2.80% set Tuesday. The two-year closed at 0.31% for the eighth consecutive trading session.
The tax-exempt market has been steady or firmer for 23 consecutive sessions. Since the most recent rally began on June 22, yields on the 10-year have fallen 25 basis points while the 30-year yield has plunged 37 basis points.
Treasuries were weaker as fears from the Eurozone subsided. The two-year yield increased two basis points to 0.24%. The benchmark 10-year yield jumped four basis points to 1.44% while the 30-year yield increased three basis points to 2.49%.
In the primary market, Barclays Capital priced for institutions $997.3 million of University of California Regents limited project revenue bonds in tax-exempt and taxable series, following a retail order period Wednesday. The bonds are rated Aa2 by Moody's Investors Service, AA-minus by Standard & Poor's and AA by Fitch Ratings.
Yields on the first series, $896.9 million of tax-exempt bonds, ranged from 0.36% with a 3% coupon and 0.36% priced at par in a split 2014 maturity to 3.17% with a 5% coupon in 2042. Credits maturing in 2013 were offered via sealed bid. The bonds are callable at par in 2022.
The second series of $100.4 million of taxable bonds, were priced at par to yield 4.053% in 2041. The bonds were priced 160 basis points above the comparable Treasury yield.
RBC Capital Markets repriced $181.1 million of North East Independent School District unlimited tax school building and refunding bonds, rated Aa1 by Moody's and AA-minus by Standard & Poor's. The credit is backed by the Texas Permanent School Fund Guarantee Program, which carries triple-A ratings.
Yields ranged from 0.22% with a 2% coupon in 2013 to 3.29% with a 4% coupon in 2042. The bonds are callable at par in 2022. Yields were lowered as much as six basis points in the repricing.
Bank of America Merrill Lynch priced $172.9 million of California Health Facilities Financing Authority bonds in two series, rated Baa2 by Moody's and BBB-plus by Standard & Poor's.
Yields on the first series, $121.2 million of revenue bonds, ranged from 1.78% with a 5% coupon in 2015 to 4.28% with a 5% coupon in 2034. The bonds are callable at par in 2022.
The second series, $51.7 million of variable rate bonds, were priced 180 basis points above the SIFMA index maturing in 2042. The bonds are callable at par in 2017.