Municipal bonds were steady Thursday morning as activity levels remained low in light of a snowstorm in the northeast.
"There's not much reaction to anything right now because of the weather today," one trader in New Jersey said.
New York City received 5.4 inches of snow Thursday since the storm began, according to The Weather Channel. Snow and rain accumulating up to an additional four inches is forecast into the evening.
Market participants said trading desks were empty Thursday, slowing down a municipal market that's already been hampered by a lack of new bond issues ahead of a three-day weekend.
"Issuance this month is not a drop in the bucket compared to what we need," the trader said. "Right now we need $10 billion a week to get rolling again."
Volume this week was estimated at just $2.65 billion, with $1.52 billion in negotiated deals and $1.14 billion in the competitive arena. The lack of supply has favored issuers who are able to bring bonds to the market at low yields.
"A lot of bonds that have been leaving this market, maturing or getting called, and they're not getting replaced by any new bonds," the New Jersey-based trader said. "If we had the product, we could move it right now, but everything's that's coming is just too expensive."
One deal not scheduled on the calendar that came Wednesday was $201.5 million of Dallas-ort Worth International Airport revenue refunding bonds, led by Citigroup.
Yields on the bonds ranged from 0.20% with a 1% coupon in 2014 to 4.70% with a 5% coupon maturing in 2032. Bonds maturing in 2024 were offered with a 3.87% yield and a 4% coupon. Rated A-plus by Standard & Poor's and A by Fitch Ratings, the bonds are callable at par in 2023.
Municipal bond yields were steady Thursday morning, according to Municipal Market Data's AAA scale. Yields on some bonds maturing from 2018 to 2027 rose one basis point.
Treasuries yields fell, with the 30-year moving two basis points lower to 3.70% and the 10-year falling two basis points to 2.75%. The two-year yield also slid two basis points to 0.33%.
