NEW YORK — The municipal market started the day quietly.
Traders saw some deals being priced, including the week’s largest. There are also many bid-wanteds in the secondary, but few bites, a trader in New York said.
“We’re not going crazy, but we’re staying involved,” he said. “I can’t get excited about these levels. It seems like there’s money out there.”
Tax-exempt yields are firmer across all but the front end of the curve, according to the Municipal Market Data scale. Maturities beyond 2020 are flat to two basis points lower.
The benchmark 10-year yield Wednesday reached a new MMD record after falling one basis point to 2.09%. It has fallen 15 points since Sept. 1.
The 30-year yield ticked down two basis points on the day to 3.68%, its lowest level since Sept. 28, 2010.
The two-year yield remained unchanged at 0.30% for a 20th consecutive session, hovering at its lowest level in more than 40 years.
Treasury yields, which weakened Wednesday, were back on the rally track Thursday morning. The 10-year benchmark yield fell four basis points to 2.01%, still very low for the year.
The 30-year yield also dropped four basis points to 3.33%. The two-year yield trimmed one basis point to 0.20%.
The holiday-shortened week is still expected to result in a larger amount of new-issuance than last week’s. Industry estimates place the total for the week at almost $3 billion, versus a rather slight $1.72 billion last week.
The competitive market is expected to be notably lacking in large-scale deals; only a few in excess of $50 million are slated to come to market this week.
In the primary Thursday, Goldman, Sachs & Co. priced $512 million of Metropolitan Transit Authority of Harris County, Texas, sales and use tax bonds in two series. The bonds are rated Aa2 by Moody’s Investors Service and AA by Standard & Poor’s.
Yields for the first series, $463 million of sales and use tax bonds, ranged from 0.88% with a 5.00% coupon in 2015 to 4.23% with a 5.00% coupon in 2041. Yields for the second series, $49.1 million of sales and use tax contractual obligations, ranged from 0.50% with a 4.00% coupon in 2013 to 3.06% with a 5.00% coupon in 2023. Debt maturing in 2012 was offered in a sealed bid.
In economic news, the Labor Department reported Thursday that initial jobless claims rose by 2,000 to 414,000 on a seasonally adjusted basis for the week ending Sept. 3. Continuing claims fell to 3.72 million for the week ending Aug. 27.
Economists polled by Thomson Reuters predicted 405,000 initial claims and 3.72 million continuing claims.
Also, the Commerce Department reported Thursday that the U.S. trade balance shrank 13.1% in July to $44.8 billion. Exports increased and import prices for petroleum products eased.
Exports rebounded, increasing by $6.2 billion, or 3.6%, following two months of declines. The gain was led by more exports of industrial supplies, capital goods and autos.
