Municipal bond traders were clearing the decks on Monday, preparing to take on the week's heftier new issue calendar.
Secondary Market
Treasury prices were lower on Monday, with the yield on the two-year Treasury rising to 0.74% from 0.73% on Friday, while the 10-year yield rose to 2.17% from 2.15% and the 30-year yield increased to 2.95% from 2.93%.
On Friday, municipals closed unchanged. The yield on the 10-year benchmark muni general obligation finished steady from 2.04% on Thursday, while the yield on the 30-year GO was unchanged from 3.07%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Friday at 93.8% versus 93.8% on Thursday, while the 30-year muni to Treasury ratio stood at 103.5% compared to 103.5%, according to MMD.
Primary Market
Total volume for the week is estimated at $6.24 billion, which is comprised of $4.81 billion of negotiated deals and $1.43 billion of competitive sales.
The Clark County School District, Nev., leads off the calendar on Tuesday with two separate competitive sales totaling over $500 million.
The school district will sell $342 million of Series 2015C limited tax general obligation building and refunding bonds and $200 million of Series 2015B limited tax GO school bonds additionally secured by pledged revenues.
The bonds are rated A1 by Moody's Investors Service and AA-minus by Standard & Poor's.
The district last sold comparable bonds on Feb. 24 when Bank of America Merrill Lynch won $258 million of Series 2015A GOLT refunding bonds with a true interest cost of 1.05%.
On the competitive short term slate, the Louisville and Jefferson County, Ky., Metropolitan Sewer District is selling $226 million of Series 2015 sewer and drainage system subordinated bond anticipation notes. The BANs, which are due Nov. 22, 2016, are rated MIG1 by Moody's.
The district last sold BANs on Nov. 4, 2014, to BAML, which won the Series 2014 notes with a TIC of 0.29%
Bank of America Merrill Lynch is expected to price the Los Angeles Municipal Improvement Corp.'s $298 million of Series 2015A taxable convention center lease revenue refunding bonds on Tuesday. The issue is rated A-plus by S&P and Fitch Ratings.
Wells Fargo Securities is set to priced San Antonio, Texas' $235 million of CPS energy electric and gas system revenue bonds on Tuesday. The bonds are rated Aa1 by Moody's, AA by S&P and AA-plus by Fitch.
On Thursday, a group including Citigroup and BAML as senior managers is set to price the Massachusetts Transportation Fund's $450 million of Series 2015A special obligation revenue bonds under the Rail Enrichment Program (REP) after a one-day retail order period on Wednesday. The bonds are rated triple-A by Moody's and S&P.
The REP was established to issue either general obligation or special obligation bonds to fund the capital expenditures of MassDOT for the MBTA. This issuance is the first special obligation sale under Chapter 79 of the state's general laws.
Proceeds of the sale will be used to fund six REP major projects, including the Green Line extension, Orange and Red Line vehicle replacements, the South Coast Rail Extension, the Knowledge Corridor improvements, South Station improvements, and Fairmount Line improvements.
Barclays Capital is slated to price the California Health Facilities Financing Authority's Series 2015 refunding revenue bonds for the Cedars-Sinai Medical Center on Thursday afternoon after a morning retail order period. The issue is rated Aa3 by Moody's and AA-minus by Fitch Ratings.
The Previous Week's Actively Traded Sectors
Revenue bonds comprised 55.38% of new issuance in the week ended Oct. 30, down from 56.55% in the previous week, according to Markit. General obligation bonds comprised 36.47% of total issuance, up from 35.44%, while taxable bonds made up 8.15%, up from 8.01%.
Some of the most actively traded issues in the week were in New Jersey, Puerto Rico and California.
In the revenue bond sector, the New Jersey Turnpike Authority 5s of 2045 were traded 119 times. In the GO bond sector, the Puerto Rico commonwealth 8s of 2035 were traded 38 times. And in the taxable bond sector, the California 7.55s of 2039 were traded 27 times, Markit said.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 30,490 trades on Friday on volume of $9.44 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $625.3million to $9.95 billion on Monday. The total is comprised of $3.71 billion competitive sales and $6.24 billion of negotiated deals.
