After a busy week filled with many new deals, the municipal bond market is looking ahead to the Thanksgiving week’s calendar, which is headlined by the New York Metropolitan Transportation Authority’s $2 billion green bond offering.

Secondary market
U.S. Treasuries were mixed on Friday. The yield on the two-year Treasury was unchanged from 1.71% on Thursday, the 10-year Treasury yield decreased to 2.35% from 2.36% and the yield on the 30-year Treasury increased to 2.81% from 2.80%.

Municipals ended weaker on Thursday. The yield on the 10-year benchmark muni general obligation rose one basis point to 2.00% from 1.99% on Wednesday, while the 30-year GO yield increased one basis point to 2.69% from 2.68%, according to a read of Municipal Market Data’s triple-A scale.

On Thursday, the 10-year muni-to-Treasury ratio was calculated at 84.9% compared with 85.3% on Tuesday, while the 30-year muni-to-Treasury ratio stood at 96.1% versus 96.4%, according to MMD.

AP-MBIS 10-year muni at 2.278%, 30-year at 2.793%
The Associated Press-MBIS municipal non-callable 5% GO benchmark scale was stronger at in early trade.

The 10-year muni benchmark yield dipped to 2.278% on Friday from the final read of 2.279% on Thursday, according to Municipal Bond Information Services, a national consortium of municipal interdealer brokers. The AP-MBIS 30-year benchmark muni yield dropped to 2.793% from 2.801%.

The AP-MBIS benchmark index is a yield curve built on market data aggregated from MBIS member firms and is updated hourly on the Bond Buyer Data Workstation

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 43,611 trades on Thursday on volume of $12.37 billion.

Week's actively traded issues
Some of the most actively traded bonds by type in the week ended Nov. 17 were from Puerto Rico, Ohio and New Jersey, according to Markit.

In the GO bond sector, the Puerto Rico 8s of 2035 were traded 26 times. In the revenue bond sector, the Ohio Air Quality Development Authority 4.5s of 2048 were traded 70 times. And in the taxable bond sector, the New Jersey Educational Facilities Authority 3.836s of 2047 were traded 17 times.

Week's actively quoted issues
Puerto Rico, Pennsylvania and Illinois names were among the most actively quoted bonds in the week ended Nov. 17, according to Markit.

On the bid side, Puerto Rico Public Buildings Authority revenue 5.25s of 2042 were quoted by 43 unique dealers. On the ask side, Pennsylvania Turnpike Commission revenue 4s of 2039 were quoted by 319 dealers. And among two-sided quotes, Illinois taxable 5.1s of 2033 were quoted by 21 unique dealers.

Week’s primary market
JPMorgan Securities priced the Chicago Board of Education’s $1.025 billion of Series 2017 unlimited tax dedicated revenue general obligation and GO refunding bonds. The GOs are rated B by S&P Global Ratings, BB-minus by Fitch Ratings and BBB by Kroll Bond Rating Agency.

JPMorgan also priced the board’s $64.9 million Series 2017 dedicated capital improvement tax bonds. The CITs are rated A by Fitch and BBB by Kroll.

“The ripple effects of the hard-fought education funding reform and management improvements continue to help CPS devote more resources to the classroom, and put the district on much stronger financial footing. The latest example is this week’s bond sales, which generated $208 million in savings and $318 million for capital improvements,” said Chicago Public Schools CEO Forrest Claypool.

“In the past few months, three ratings agencies have either upgraded CPS or improved their view of the district’s financial outlook, and we will continue to build on this tremendous progress so that students can continue their remarkable academic progress,” Claypool said.

In the competitive arena, Washington state sold $742.65 million of Series R-2018C various purpose general obligation refunding bonds on Tuesday. Bank of America Merrill Lynch won the bonds with a true interest cost of 2.75%. The deal is rated Aa1 by Moody’s Investors Service and AA-plus by S&P and Fitch.

“Pending Congressional action potentially changing future tax policy and restricting the state’s ability to issue refunding bonds helped support the biggest single bond refunding issue in Washington state history," State Treasurer Duane Davidson said in a press release. “The sale was the single largest series of refunding bonds issued in state history and will reduce debt service costs to the state by almost $138 million, or 13.24% on a present value basis.”

In the 2017-2019 biennium the state will save $9,008,500 in interest, with an average of $7.25 million saved per year until the final maturity date. In net present value terms the refunding produces savings of $107,782,059 or 13.24%, according to the Treasurer’s office.

“Right now, due to policy changes being debated in Congress, there is uncertainty in the market and that creates opportunity. We were able to issue our biggest ever series of refunding bond at an excellent rate,” Davidson said. Congress is considering eliminating the ability to issue tax-exempt advance refunding bonds. The possibility that such a policy change might take effect as of Jan. 1, 2018, likely helped fuel the strong demand for this refunding, he added.

In the negotiated sector, Citigroup priced the Metropolitan Pier and Exposition Authority’s $472.74 million of McCormick Place expansion project and expansion project refunding bonds. The deal is rated BB-plus by S&P and BBB-minus by Fitch except for the Series 2017B CAB 2056 maturity which is insured by Assured Guaranty Municipal and rated AA by S&P.

Barclays Capital priced New York City Municipal Water Finance Authority’s $398.12 million of Fiscal 2018 Series CC water and sewer system second general resolution revenue bonds. The deal is rated Aa1 by Moody’s and AA-plus by S&P and Fitch.

Citigroup priced the South Jersey Port Corp.’s $255 million of Series 2017A and B subordinated marine terminal revenue bonds. The deal is rated Baa1 by Moody’s.

Morgan Stanley priced the New Jersey Educational Facilities Authority’s $183.84 million of Series 2017C taxable revenue refunding bonds. The deal is rated A2 by Moody’s and A-minus by S&P.

Bank of America Merrill Lynch priced the Pittsburgh Water and Sewer Authority’s $164.85 million of Series 2017A tax-exempt and Series 2017B taxable water and sewer system first lien revenue refunding bonds. The series is insured by Assured Guaranty Municipal and rated A2 by Moody’s and AA by S&P. The $5.595 million Series 2017B taxables were rated A2 by Moody’s and A by S&P.

JPMorgan Securities priced Norfolk, Va.’s $162.73 million of general obligation capital improvement and refunding bonds. The deal is rated Aa2 by Moody’s and AA-plus by S&P and Fitch.

Siebert Cisneros Shank priced Tallahassee, Fla.’s $115.41 million of Series 2017 consolidated utility systems refunding bonds. The deal is rated AA by S&P and AA-plus by Fitch.

Wells Fargo priced the Champaign County Community Unit School District No. 4, Ill.’s $110 million of Series 2017 GO school building bonds. The deal is rated Aa2 by Moody’s and AA by S&P.

Piper Jaffray priced the Illinois Finance Authority’s $51.31 million of Series 2017A charter school refunding and improvement revenue bonds for the Chicago International Charter School project. The deal is rated BBB by S&P.

Loop Capital Markets priced the Illinois State Toll Highway Authority’s $300 million of Series 2017A toll highway senior revenue bonds. The deal is rated Aa3 by Moody’s and AA-minus by S&P and Fitch.

Bank of America Merrill Lynch priced the Ohio Air Quality Development Authority’s $210 million of Series 2017 exempt facilities revenue bonds, subject to the alternative minimum tax, for the Pratt Paper LLC project. The deal is unrated.

In the competitive sector, Wisconsin sold $272.67 million of Series 2017B GOs. Wells Fargo Securities won the bonds with a TIC of 3.446%.The deal is rated Aa1 by Moody’s, AA by S&P and AA-plus by Fitch.

Dallas sold $302.85 million of Series 2017 GO refunding and improvement bonds. RBC Capital Markets won the bonds with a true interest cost of 2.8850%. The deal is rated AA-minus by S&P and AA by Fitch.

Charleston County, S.C., sold $212.5 million of GOs in three separate sales. JPMorgan Securities won the $103.18 million of Series 2017A GO capital improvement bonds with a TIC of 2.8638%; BAML won the $93.615 million of Series 2017C GO transportation sales tax refunding GOs with a TIC of 2.320% and BAML also won the $15.705 million of Series 2017B GO refunding bonds with a TIC of 2.153%. The deals are rated triple-A by Moody’s, S&P and Fitch.

The Cook County Community College District No. 512, Ill., sold $107.12 million of Series 2017B general obligation refunding bonds. BAML won the bonds with a TIC of 2.1738%.The deal is rated Aaa by Moody’s.

The East Bay Regional Park District., Calif., sold $125.67 million of GOs in two separate offerings. Morgan Stanley won the $80 million of Series 2017A-1 Election of 2008 GOs and Series 2017A-2 Election of 2008 GO green bonds with a TIC of 2.4785% while BAML won the $45.67 million of Series 2017B-1 GO refunding bonds and Series 2017B2 GO refunding green bonds with a TIC of 1.9123%. The deals are rated triple-A by Moody’s and S&P.

The Dublin Unified School District, Calif., sold $100 million of Series B Election of 2016 GOs. Robert W. Baird won the bonds with a TIC of 3.3981%. The deal is rated Aa1 by Moody’s and AA by S&P.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $801.8 million to $6.19 billion on Thursday. The total is comprised of $912.1 million of competitive sales and $5.279 billion of negotiated deals.

Lipper: Muni bond funds see inflows
Investors in municipal bond funds again put cash back into the funds in the latest week, according to Lipper data released late Thursday.

The weekly reporters saw $417.719 million of inflows in the week of Nov.15, after inflows of $463.044 million in the previous week.

Exchange traded funds reported inflows of $23.098 million, after inflows of $35.922 million in the previous week. Ex-ETFs, muni funds saw $394.621 million of inflows, after inflows of $427.122 million in the previous week.

The four-week moving average was positive at $121.942 million, after being in the green at $151.552 million in the previous week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.

Long-term muni bond funds had inflows of $373.985 million in the latest week after inflows of $315.728 million in the previous week. Intermediate-term funds had outflows of $1.017 million after inflows of $100.973 million in the prior week.

National funds had inflows of $453.793 million after inflows of $462.979 million in the previous week.

High-yield muni funds reported inflows of $203.559 million in the latest week, after inflows of $206.612 million the previous week.

Data appearing in this article from Municipal Bond Information Services, including the AP-MBIS municipal bond index, is available on The Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Vanessa Kim at 212-803-8474 for more information.

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Chip Barnett

Chip Barnett

Chip Barnett is a journalist with more than 40 years of experience. Barnett is currently Senior Market Reporter for The Bond Buyer.
Aaron Weitzman

Aaron Weitzman

Aaron Weitzman is a markets reporter for The Bond Buyer, focusing on the sell side of the municipal bond market.