Nearly all The Bond Buyer's weekly yield indexes declined this week, as tax-exempts finished firmer in each of the week's sessions.
"Monday was the last day of the quarter, and we did see a bit of buying interest, but mostly people were closing their books," said Evan Rourke, portfolio manager at MD Sass. "Then Tuesday, munis kind of hit the ground running, and we got some solid outperformance in the market, relative to Treasuries and swaps. [Yesterday], however, it was a little more of a mixed bag."
"I think we're definitely up, but there's some bifurcation going on in the market, where you're seeing the high grades attracting very strong interest, and anything less than a natural double-A GO is sort of lagging," Rourke continued. "Some of this bid may be being driven by some crossover buyers, because just in general, if you had a triple-A GO, you're probably up 10 basis points from Monday, but if you had an insured hospital, you're unchanged, or maybe even worse. But overall, there's been some real nice outperformance this week."
The municipal market was firmer in light trading Friday, with equities showing further declines after Thursday's plunge. Munis were then again firmer in light trading Monday, even as Treasuries were largely unchanged.
On Tuesday, munis were firmer by about three to five basis points, despite the Treasury market showing losses. Then, yesterday, tax-exempt yields were lower by about three basis points, following the Treasury market, which posted some gains.
The 20-Bond and 11-Bond GO indexes both fell 16 basis points this week, to 4.67% and 4.58%, respectively. These are their lowest levels since June 5 when they were 4.59% and 4.49%, respectively.
The Revenue Bond Index fell 11 basis points, to 5.14%, which is the lowest since June 12, when it was also 5.14%.
The 10-year Treasury note yield fell eight basis points, to 3.97%, which is the lowest since May 22, when it was 3.92%.
The 30-year Treasury note yield fell 10 basis points, to 4.51%, which is the lowest since May 1, when it was 4.49%.
The One-Year Note Index rose one basis point, to 1.70%, but remained below its 1.73% level from two weeks ago.
The weekly average yield to maturity of The Bond Buyer Municipal Bond Index fell 8 basis points this week, to 5.17%. That is the same as the 5.17% average for two weeks ago, the week ended June 19.