The muni market is skidding to a halt from a break-neck issuance filled two weeks, as an eerie quiet pervades ahead of the long holiday weekend.

Secondary market
The MBIS municipal non-callable 5% GO benchmark scale was mixed in trading through Thursday’s midway point.

The 10-year muni benchmark yield was steady at 2.386% from Wednesday’s final read, according to Municipal Bond Information Services. The MBIS 30-year benchmark muni yield decreased to 2.852% from 2.853%.

The MBIS benchmark index, which is comprised of investment-grade municipal securities, is updated hourly on the Bond Buyer Data Workstation.

Top-rated municipal bonds were mixed on Thursday around midday. The yield on the 10-year benchmark muni general obligation was steady at 2.13% from Wednesday, while the 30-year GO increased by as many as two basis points from 2.73%, according to a read of MMD’s triple-A scale.

U.S. Treasuries were mostly stronger around noon on Thursday. The yield on the two-year Treasury nudged up to 1.87% from 1.86%, the 10-year Treasury yield slipped to 2.48% from 2.50% and the yield on the 30-year Treasury fell to 2.84% from 2.88%.

On Wednesday, the 10-year muni-to-Treasury ratio was calculated at 85.4% compared with 84.5% on Tuesday, while the 30-year muni-to-Treasury ratio stood at 94.9% versus 94.9%, according to MMD.

Tax-exempt money market funds saw inflows
Tax-exempt money market funds experienced inflows of $690.4 million, bringing total net assets to $131.19 billion in the week ended Dec. 18, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $271.3 million to $130.50 billion in the previous week.

The average, seven-day simple yield for the 199 weekly reporting tax-exempt funds rose to 0.62% from 0.53% in the previous week.

The total net assets of the 827 weekly reporting taxable money funds decreased $22.62 billion to $2.659 trillion in the week ended Dec. 19, after an inflow of $34.30 billion to $2.682 trillion the week before.

The average, seven-day simple yield for the taxable money funds jumped to 0.85% from 0.76% from the prior week.

Overall, the combined total net assets of the 1,026 weekly reporting money funds decreased $21.93 billion to $2.791 trillion in the week ended Dec. 19, after inflows of $34.57 billion to $2.813 trillion in the prior week.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 52,688 trades on Wednesday on volume of $20.193 billion.

Bond Buyer 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $1.49 billion to $5.18 billion on Thursday. The total is comprised of $879 million of competitive sales and $4.30 billion of negotiated deals.

Primary market
The muni market has all but come to a complete stop, with the long holiday weekend right away the corner. After weeks of fast and furious activity, where issuers rushed to market to beat impending tax legislation changes — a lot of people have decided to start the weekend early, as if often the case before a holiday.

“It has been a harrowing month of hyper-partisanship in Washington that finally led to a bi-cameral (but not bi-partisan) agreement on tax cuts,” said Natalie Cohen, senior analyst and managing director, municipal securities research, Wells Fargo. "Interestingly, the bill may not be signed for a bit, until spending caps can be lifted.”

President Trump may have to wait until January to sign the sweeping overhaul of the nation’s tax system that cleared Congress midday Wednesday.

Data appearing in this article from Municipal Bond Information Services, including the 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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Aaron Weitzman

Aaron Weitzman

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