Stronger trading in the secondary market pushed municipals higher Wednesday morning following positive reception for newly priced deals this week.
“The market feels firm,” a New York trader said. “There is good secondary activity. The new issues pricing Tuesday seem to have helped. People are looking at the secondary now that that's out of the way.”
The last of the week’s largest deals priced Wednesday morning as the market traded higher for a seventh consecutive session.
Siebert Brandford Shank & Co. priced for institutions $600 million of Connecticut special tax obligation debt for transportation infrastructure financing, following a retail order period Tuesday. The bonds are rated Aa3 by Moody’s Investors Service and AA by both Standard & Poor’s and Fitch Ratings. By Tuesday afternoon, retail had placed $155 million in orders.
In institutional pricing Wednesday morning, yields ranged from 0.56% with a 3% and 5% coupon in a split 2016 maturity to 4.25% priced at par and 4.11% with a 5% coupon in a split 2033 maturity. Bonds maturing in 2014 and 2015 were offered via sealed bid. The bonds are callable at par in 2023. Yields were lowered as much as four basis points from retail pricing on bonds maturing between 2016 and 2023. Yields were raised one basis point on bonds maturing in 2028 and 2032.
Goldman, Sachs & Co. is expected to price for institutions $630 million of New York’s Metropolitan Transportation Authority in two parts, rated A2 by Moody’s and A by Standard & Poor’s. The pricings will consist of $500 million and $130 million.
In retail pricing Tuesday, yields on the first pricing of $500 million ranged from 0.50% with 3% and 5% coupons in a split 2015 maturity to 4.86% with a 5% coupon in 2043. Bonds maturing in 2014 were offered via sealed bid. The bonds are callable at par in 2023.
Yields on the second pricing of $130 million ranged from 3.23% with a 5% coupon in 2023 to 3.91% with a 5% coupon in 2027. The bonds are callable at par in 2023. Retail investors placed $17 million in order on Tuesday.
Vallejo, Calif., came to market with $18 million of water revenue refunding bonds in its first public financing since it emerged from bankruptcy in 2011. De La Rosa priced the bonds, rated A-plus by Standard & Poor’s. Yields ranged from 4.32% with a 5.25% coupon in 2027 to 4.81% with a 5.25% coupon in 2031. The bonds are callable at par in 2023.
On Tuesday, yields on the triple-A Municipal Market Data scale ended as much as five basis points stronger. The 10-year yield slid four basis points to 2.44%. The two-year and 30-year yields fell one basis point each to 0.34% and 4.05%, respectively.
Yields on the Municipal Market Advisors benchmark scale ended as much as two basis points firmer. The 10-year slid one basis point to 2.62%. The two-year and 30-year yields were steady for the third session at 0.53% and 4.23%, respectively.
Treasuries were flat to firmer Wednesday morning. The two-year and 30-year yields were steady at 0.32% and 3.62%, respectively. The benchmark 10-year yield slid two basis points to 2.49%.