The week's two largest deals being priced for retail weren't enough to get the municipal market rallying Wednesday, traders said.
"We're marginally better but nothing crazy," a New York-based trader said in an interview. "Of course anything is going to be received pretty well, you have no issuance."
Yields, according to Municipal Market Data's triple-A scale, were steady on the short end of the curve Wednesday afternoon as yields on bonds maturing from 2017 and out fell as much as two basis points.
Traders said two new bond issues, $400 million of Metropolitan Transportation Authority bonds and $201 million of Louisiana State Highway bonds, drew some attention even as the market remained mostly quiet.
"What saved us before was the refundings, and now all those are gone, and historically supply is never that large in January or February," the trader said. "People are hesitant right now. We're not moving the paper like we used to as people see what's happening in Detroit, Chicago and Puerto Rico, they get a little gun-shy."
Morgan Stanley led the retail pricing of $400 million of MTA transportation revenue bonds, rated A2 by Moody's Investors Service, A-plus by Standard & Poor's and A by Fitch Ratings.
Citigroup Global Markets brought the retail pricing of $201 million Louisiana highway revenue bonds, which carried an Aa3 Moody's rating and AA-minus scores from S&P and Fitch.
Yields on the Louisiana bonds ranged from 0.25% with a 2% coupon maturing in 2015 to 3.95% with a 5% coupon in 2034. The bonds feature an optional call in 2024.
The benchmark 30-year Treasury yield was up one basis points to 3.70%, while the 10-year climbed the same amount to 2.73%. The two-year yield fell one basis point to 0.31%.
