The tax-exempt market continued to firm as new issues were well received and bonds traded higher in the secondary market.
Connecticut and New York's Metropolitan Transportation Authority were the largest deals to price for retail investors. "The MTA deal looks OK and priced at plus 80 basis points to the scale," a New Jersey trader said. "So new issue product is still doing OK."
In the secondary market, this trader said bonds issued last week were trading higher. "Healthcare deals that came last week traded up. Puerto Rico is coming back a little bit too."
Still, as yields fell for the sixth consecutive session on Tuesday, some traders are hesitant to buy much more. "We are coming back into hesitation at these lower yields," the trader said. "The market is OK and it's grinding higher but we are having a little resistance."
Siebert Brandford Shank & Co. priced for retail $600 million of Connecticut special tax obligation debt for transportation infrastructure financing. The bonds are rated Aa3 by Moody's Investors Service and AA by both Standard & Poor's and Fitch Ratings. Institutional pricing is expected Wednesday.
By Tuesday afternoon, retail had placed $155 million in orders.
Yields ranged from 0.60% with a 3% and 5% coupon in a split 2016 maturity to 4.25% priced at par in 2033. Bonds maturing in 2014 and 2015 were offered via sealed bid. Portions of bonds maturing between 2025 and 2033 were not offered for retail. The bonds are callable at par in 2023. Spreads ranged from five basis points to 38 basis points above Monday's Municipal Market Data scale.
Goldman, Sachs & Co. priced for retail $630 million of New York's Metropolitan Transportation Authority in two parts, rated A2 by Moody's and A by Standard & Poor's. The pricings will consist of $500 million and $130 million. Institutional pricing is expected Wednesday.
Yields on the first pricing of $500 million ranged from 0.50% with 3% and 5% coupons in a split 2015 maturity to 4.86% with a 5% coupon in 2043. Bonds maturing in 2014 were offered via sealed bid. The bonds are callable at par in 2023.
Yields on the second pricing of $130 million ranged from 3.23% with a 5% coupon in 2023 to 3.91% with a 5% coupon in 2027. The bonds are callable at par in 2023.
Goldman also priced $549.4 million special revenue bonds from the Nevada Unemployment Compensation Fund. The bonds are rated triple-A by Moody's and Standard & Poor's and AA-plus by Fitch.
Yields ranged from 0.23% with a 2% coupon in 2014 to 1.00% with a 5% coupon in 2018. Bonds maturing in 2018 are callable at par in 2017.
Bonds maturing in June between 2015 and 2017 were priced between one basis point richer and one basis point cheaper than Monday's MMD scale. Bonds maturing in December between 2014 and 2017 were priced with spreads ranging from five basis points to 12 basis points above the scale.
On Monday, yields on the triple-A Municipal Market Data scale ended as much as three basis points stronger. The 10-year and 30-year yields fell one basis point each to 2.48% and 4.06%, respectively. The two-year was steady at 0.35% for the 12th session.
Yields on the Municipal Market Advisors benchmark scale ended as much as two basis points firmer. The 10-year slid one basis point to 2.63%. The two-year and 30-year yields were steady at 0.53% and 4.23%, respectively, for the second session.
Treasuries continued to weaken Tuesday. The two-year and 10-year yields rose one basis point each to 0.33% and 2.53%, respectively. The 30-year yield rose three basis points to 3.64%.
