The tax-exempt market got off to a typical start Monday morning with traders struggling to get to work. The market was mostly steady and quiet, despite a few deals pricing for retail in the primary market.
"Munis aren't doing much," a New York trader said. "There is some buying and selling but it's not rallying or going down."
In the primary market this week, $7.45 billion is expected to be priced, down slightly from last week's revised $7.47 billion. In the negotiated market, $6.35 billion is expected to be issued, up from last week's revised $6.14 billion. On the competitive calendar, $1.1 billion should be auctioned, down from last week's revised $1.33 billion.
The Pennsylvania Economic Development Financing Authority is expected to issue for retail $2.6 billion of tax-exempt bonds in two pricings, rated Aaa by Moody's Investors Service, and AA-plus by Standard & Poor's and Moody's Investors Service. Institutional pricing is expected Tuesday.
Citi is expected to price $1.4 billion of unemployment compensation bonds. Bank of America Merrill Lynch is expected to price $1.6 billion of unemployment compensation revenue bonds.
JPMorgan is expected to price a second retail order period of $825 million of City of New York general obligation bonds, following a retail order period Friday. Institutional pricing is expected Tuesday. The bonds are rated Aa2 by Moody's and AA by Standard & Poor's and Fitch.
On Friday, the 10-year Municipal Market Data yield fell one basis point to 1.71% while the 30-year yield dropped three basis points to 2.85%. The two-year closed flat for the fourth session at 0.30%.
Since the most recent rally streak began Sept. 17, the 10-year MMD yield has plunged 23 basis points from 1.93% while the 30-year yield has plummeted 21 basis points from the 3.06% where it traded on Sept. 17.
The 10-year yield is now at its lowest since Aug. 2 when it touched 1.66%. It hovers only six basis points above its record low of 1.60% set July 26.
The 30-year yield is at its lowest since Aug. 2 when it yielded 2.84%, just five basis points above its 2.79% record low yield hit July 25.
Treasuries were slightly weaker Monday morning. The benchmark 10-year yield and the 30-year yield rose one basis point each to 1.65% and 2.84%, respectively. The two-year yield increased one basis point to 0.24%.