The municipal bond market on Thursday is seeing the last of the week's big issues come to market while eying a slight pause in the recent rally in muni prices that has left yields lower.
J.P. Morgan Securities priced the New York Metropolitan Transportation Authority's $500 million transportation revenue bonds in two series.
The $400 million fixed-rate Subseries 2015A-1 bonds were priced to yield from 0.80% with a 5% coupon in 2017 to 2.93% with a 5% coupon in 2037. A 2040 term bond was priced as 5s to yield 2.98% while a 2045 term was priced as 5s to yield 3.04%. The 2015-2016 maturities were offered as sealed bids.
The $100 million SIFMA floating-rate Subseries 2015A-2 tender notes were priced at par to yield 60 basis points over the SIFMA rate in 2039.
The entire issue is rated A2 by Moody's Investors Service AA-minus by Standard & Poor's and A by Fitch Ratings.
Primary Market
RBC Capital Markets received the official award on the Regents of the University of Colorado's $106.375 million University of Enterprise revenue and refunding bonds. The $102.45 million Series A bonds were priced to yield from 0.17% with a 2% coupon in 2015 to 3.29% with a 3.35% coupon in 2039. The $3.925 million Series B bonds were priced to yield from 0.22% with a 2% coupon in 2015 to 3.09% with a 3% coupon in 2033; a 2035 term was priced as 5s to yield 2.71%. The issue is rated Aa2 by Moody's and AA-plus by Fitch.
Barclays Capital received the award on the Los Angeles County Public Works Financing Authority, Calif.'s $153.94 million lease revenue bonds for multiple capital projects. The issue was priced to yield from 0.43% with a 3% coupon in 2016 to 2.95% with a 5% coupon in 2034; a 2039 term bond was priced as 5s to yield 3% while a 2044 term was priced as 5s to yield 3.06%. The bonds are rated A1 by Moody's Investors Service, AA by Standard & Poor's, and A-plus by Fitch Ratings.
Secondary Market
Prices of top-quality municipal bonds were mixed on Thursday. The yield on the benchmark 10-year general obligation was as much as one basis point lower from 1.78% on Wednesday, while the yield on 30-year GOs was unchanged at 2.54%, according to a recent read of Municipal Market Data's triple-A scale.
Treasury prices were higher on Thursday, with the two-year note yield falling to 0.46% from 0.49% on Wednesday. The 10-year yield was down to 1.80% from 1.84%, while the 30-year yield slipped to 2.44% from 2.45%.
On Wednesday, the 10-year muni to Treasury ratio was at 96.7% compared to 97.6% on Tuesday, while the 30-year muni to Treasury ratio was at 103.5% versus 105.7%.
MSRB Reports Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,457 trades on Wednesday on volume of $11.889 billion.
Most active on Wednesday, based on the number of trades, was the New Jersey Transportation Trust Fund Authority transportation program bonds, Series AA 4 1/4s of 2044, which traded 87 times with an average price of 103.352 and an average yield of 3.822%.
Tax-Exempt Money Market Funds See Outflows
Tax-exempt money market funds experienced an outflow of $1.463 billion, bringing their total net assets to $263.194 billion in the week ended Jan. 13, according to The Money Fund Report, a service of iMoneyNet.com. The funds saw $4.371 billion of inflows in the prior week.
The average seven-day yield for the 396 weekly reporting tax-exempt money funds held steady at 0.1%, while the average maturity decreased by one day to 35 days compared to the previous week.
Taxable money fund assets increased $4.07 billion to $2.471 trillion. The average seven-day yield for the 993 weekly reporting taxable funds held steady at 0.1%, while the average maturity decreased by one day to 37 days compared to the previous week.
Meanwhile, assets of all money-market funds rose $2.61 billion for the week ending Jan. 13, bringing total assets to $2.734 trillion.
