The municipal bond market will be very quiet on Tuesday as traders and investors look ahead to the early market close on Wednesday and the Christmas holiday on Thursday.
On Monday, only a big competitive note sale from Colorado broke the silence. Few deals are scheduled for this holiday-shortened week.
Primary Market
Only four deals are slated on today's competitive calendar — one bond sale and three note sales, two each under $1 million — totaling less than $10 million. No other bond issues are currently scheduled for negotiated or competitive sale until after the start of the new year.
On Monday, a $245 million Colorado tax and revenue anticipation note sale was won by JPMorgan Securities with a bid of 1.75% and a $1,952,650 premium, an effective rate of 0.1002%. The TRANs are rated MIG1 by Moody's Investors Service and SP1-plus by Standard & Poor's. RBC Capital Markets was the financial adviser on the sale.
Looking ahead to the new year, the Dormitory Authority of the State of New York has scheduled a $1 billion bond sale in a negotiated transaction for January. DASNY plans to offer $1 billion of general purpose state personal income tax revenue bonds. A group including Barclays, Citigroup and Rice Financial Products is slated to price the bonds. Proceeds of the sale will be used to refund various outstanding issues.
Also in January, Washington state will offer about $1 billion of bonds in four separate competitive sales. The sales on Jan. 21 will consist of $464.52 million various purpose general obligation refunding bonds, $270 million various purpose GOs, $206 million motor vehicle fuel tax GOs, and $58 million taxable GOs.
Miami-Dade County, Fla., will put out for bid on Jan. 6 three separate competitive sales of general obligation bonds totaling $372 million. Proceeds from the sales will be used for parks, public health and its "Building Better Communities" program.
Secondary Market
Treasury prices were lower on Tuesday, with the two-year note yield rising to 0.72% from 0.65% on Monday. The 10-year yield increased to 2.18% from 2.16% while the 30-year rose to 2.76%, from 2.75% on Monday.
On Monday, high-grade municipal bond prices were barely mixed. The yield on the benchmark 10-year general obligation note dipped one basis point to 2.07%, from 2.08% on Friday. While the yield on 30-year GOs stayed the same as Friday at 2.92%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni-to-Treasury ratio was calculated at 95.7% on Monday versus 95.9% on Friday; the 30-year muni to Treasury ratio was at 106.1%, compared with 105.4% on Friday.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 30,564 trades on Monday on volume of $5.322 billion.
Most active on Monday, based on the number of trades, was the Bolingbrook, Ill., refunding bonds of 12/29/14 Series A 4s of 2038, which traded 326 times with an average price of 99.686 and an average yield of 4.018%.
Second most active was the New Jersey Transportation Trust Fund Authority transportation program bonds, Series AA 4 1/4s of 2044, which traded 121 times with an average price of 99.652 and an average yield of 4.253%.
Reporter Aaron Weitzman contributed to this report.
