NEW YORK – The tax-exempt market took a breather Thursday morning after the rush of primary deals priced earlier in the week and allowed traders to digest activity. A few large deals remained to be sold this week, but the largest deals have already hit the market.
Munis were steady Thursday morning, according to the Municipal Market Data scale. On Wednesday, the two-year yield closed flat at 0.31% for the 11th consecutive trading session. The 10-year yield dropped two basis points to 1.85% while the 30-year fell three basis points to 3.22%.
Treasuries drifted slightly higher. The benchmark 10-year yield and the 30-year yield each rose one basis point to 1.93% and 3.12%. The two-year was steady at 0.28%.
In the primary market, JPMorgan is expected to price $170 million of Connecticut Housing Finance Authority housing mortgage finance program bonds, rated triple-A by Moody’s Investors Service and Standard & Poor’s.
Morgan Stanley is expected to price $155 million of Orange County, Fla., Health Facilities Authority hospital revenue bonds, rated A2by Moody’s and A by Standard & Poor’s and Fitch Ratings.
In economic news, seasonally adjusted initial jobless claims fell 27,000 to 365,000 for the week ending April 28. Continuing claims fell 53,000 to 3.276 million for the week ending April 21.
The initial claims were lower than the 380,000 estimated by economists while the continuing claims also came in below the 3.310 that economists had expected.
“Given the volatility in weekly jobless claims, it is too soon to declare that the decline in the latest week confirms our view that the run up in claims around the Easter holiday was a temporary seasonal phenomenon – especially since the four-week average edged slightly higher,” wrote economists at RDQ Economics. “This report, therefore, provides no reassurance about Friday’s payroll forecasts. The next two weeks of claims data, which lead into the May payroll survey week, will be important in shaping expectations.”
