The tax-exempt market continued to trader stronger Thursday afternoon as traders said the market was very active this week.
"We are seeing decent activity on the retail side, especially in kicker bonds," a trader located in the Southwest region said. "The long par bonds are dying and people would rather buy kicker bonds and zeros."
This trader added that munis feel like a tale of two markets. "Kickers and zeros feel stronger today, but par bonds on the long end still feel weaker."
In the primary market, JPMorgan is expected to price for institutions $1.3 billion of Regents of the University of California general revenue bonds, rated Aa1 by Moody's Investors Service, AA by Standard & Poor's, and AA-plus by Fitch Ratings.
In the competitive market, Bank of America Merrill Lynch won the bid for $268.3 million of Florida State Board of Education public education capital outlay refunding bonds, rated Aa1 by Moody's and AAA by Standard & Poor's and Fitch.
Yields ranged from 0.18% with a 4% coupon in 2014 to 3.25% with a 3.125% coupon in 2032. The bonds are callable at par in 2022.
Bank of America Merrill Lynch also won the bid for $174.9 million of Boston general obligation bonds in two pricings, rated Aaa by Moody's and AA-plus by Standard & Poor's.
Yields on the first pricing of $150.6 million, ranged from 0.18% with a 4% coupon in 2014 to 3.12% with a 3% coupon in 2033. The bonds are callable at par in 2023.
Yields on the second pricing of $24.3 million of refunding bonds, ranged from 0.17% with a 4% coupon in 2014 to 2.20% with a 4% coupon in 2026. The bonds are callable at par in 2023.
Municipal bond market scales finished stronger Wednesday.
Yields on the Municipal Market Data triple-A GO scale ended as much as three basis points lower. The 10-year yield fell two basis points to 1.81% while the 30-year yield dropped one basis point to 2.91%. The two-year closed at 0.31% for the seventh straight session.
Yields on the Municipal Market Advisors 5% coupon triple-A benchmark scale closed as much as one basis point lower. The 10-year and the 30-year yield fell one basis point each to 1.83% and 2.99%, respectively. The two-year was steady at 0.33% for the second session.
Treasuries were steady Thursday afternoon. The benchmark 10-year yield and the 30-year yield traded flat at 1.91% and 3.11%, respectively. The two-year was steady at 0.25%.