NEW YORK – The tax-exempt market slowed Monday afternoon as secondary activity stalled and the primary market failed to provide direction. Munis were still firmer following the risk-off trade in the morning.
“It’s just slow,” a New York trader said. “Nothing is really going on. It’s mostly just retail buying.”
Munis continued to strengthen Monday, according to the Municipal Market Data scale. Inside three years, yields were steady while outside four years, yields dropped up to three basis points.
On Friday, the two-year yield closed at 0.31% while the 30-year yield finished at 3.28%. The 10-year closed the week at 1.88%.
Treasuries were still weaker after global stocks fell. The benchmark 10-year yield and the 30-year yield each fell four basis points to 1.93% and 3.08%. The two-year was steady at 0.27%.
Janney Montgomery Scott price for retail $118.5 million of Rhode Island and Providence Plantations general obligation bonds, rated Aa2 by Moody’s Investors Service and AA by Standard & Poor’s. Pricing information was not yet available.
In the secondary market, trades reported by the Municipal Securities Rulemaking Board showed firming.
A dealer sold to a customer California State Public Works Board 4s of 2027 at 3.83%, 35 basis points lower than where they traded Friday.
A dealer bought from a customer New Jersey’s Tobacco Settlement Financing Corp. 5s of 2041 at 6.82%, eight basis points lower than where they traded a week prior.
A dealer sold to a customer Virginia Small Business Financing Authority 6s of 2037 at 4.90%, five basis points lower than where they traded last Thursday.
A dealer bought from a customer Puerto Rico Electric Power Authority 5s of 2029 at 4.70%, three basis points lower than where they traded last Thursday.