Market participants expect that volume will be weak during the shortened four-day Memorial Day week.
Total potential volume for this week is $4.2 billion, down from $6.2 billion last week, according to data compiled by Ipreo and The Bond Buyer.
"I think the market will be slow coming off of a long weekend," a trader in Chicago said. "Mondays have been bad enough the last couple weeks, and typically volume is low after a long weekend."
Volume has been light the entire year totaling $89.34 billion through April 30, compared to $122.7 billion for the same period in 2013.
"There is becoming less and less to analyze, we need some sort of volatile event to put momentum back in the market," the trader in Chicago said. "I don't care if it goes up or down 50 basis points."
A trader in New Jersey said in addition to the low supply, there may be reduced trading this week because many investors will be on vacation.
"This is the type of week many people extend to take time off," he said. "I imagine volume will be light."
There are no negotiated deals totaling over $100 million scheduled to price on Tuesday, and no competitive deals over $100 million expected to come to market the entire week.
"The market is not moving, and no one cares about [explicative]," the trader in Chicago said.
Janney Capital Markets wrote in a report released on Tuesday that airport and utility deals will dominate this week.
The city of Chicago will issue $784 million of second lien revenue and revenue refunding bonds, the largest deal in the negotiated market, on Thursday. Barclays is the lead underwriter. The deal received an A3 rating from Moody's Investors Service and an A-minus from both Standard & Poor's and Fitch Ratings.
The second largest deal this week is $561.2 million of Massachusetts Water Pollution Abatement Trust state revolving fund refunding bonds. Bank of America Merrill Lynch is the lead underwriter and the deal is rated triple-A by Moody's, S&P and Fitch.
Janney also listed the Los Angeles Department of Water and Power's $322 million second lien revenue bonds as a top utility deal expected to price this week. The bonds are scheduled for retail order on Wednesday and will begin institutional sale on Thursday.
Barclays is bringing the issuance to market, and the bonds earned ratings of Aa3 from Moody's, and AA-negative from S&P and Fitch.
Treasuries were steady Tuesday morning, with the 30-year and the two-year note unchanged at 3.40% and 0.36%, respectively, from Friday's market close.
