NEW YORK – The tax-exempt market was quiet Tuesday morning as traders waited for the primary market to provide direction. Trading activity was muted as participants recovered from a long weekend.
“The market is dead,” an Atlanta trader said, adding it’s the first work day after a holiday weekend and traders are still trying to wake up.
Munis were steady Tuesday morning, according to the Municipal Market Data scale. On Friday, the 10-year yield and the 30-year yield finished steady for the fourth consecutive trading session at 1.83% and 3.14%. The two-year yield also closed flat at 0.33% for the fourth consecutive trading session.
Treasuries were mixed Tuesday morning. The two-year yield rose one basis point to 0.30% while the benchmark 10-year yield fell one basis point to 1.73%. The 30-year was steady at 2.84%.
In the primary market this week, $4.62 billion in municipal bonds are expected, down from last week’s revised $9.21 billion. In the negotiated market, $2.91 billion is expected to be priced, down from last week’s revised $6.45 billion. On the competitive calendar, $1.71 billion is expected, down from last week’s $2.76 billion.
Later today, Jefferies & Co. is expected to price for retail $232.8 million of Massachusetts Water Pollution Abatement Trust state revolving fund bonds in two parts - $136.8 million new money and $96 million of refunding bonds. The credit is rated triple-A from all three major rating agencies. The bonds are expected to price for institutional investors Wednesday.
