The municipal bond market on Monday was preparing to see almost $10 billion of new issues hit the screens this week amid a rising yield environment.
Ipreo estimates volume for the week at $9.98 billion, comprised of $7.42 billion of negotiated deals and $2.56 billion of competitive sales.
Secondary Market
U.S. Treasuries were weaker on Monday. The yield on the two-year Treasury rose to 1.13% from 1.11% on Friday, the 10-year Treasury gained to 2.42% from 2.39%, while the yield on the 30-year Treasury bond increased to 3.09% from 3.06%.
Market participants were eyeing the fallout from Italy's failed referendum on legislative streamlining measures, with the country's prime minister expected to resign after the "no" vote.
Top-shelf municipal bonds finished stronger on Friday. The yield on the 10-year benchmark muni general obligation fell four basis points to 2.54% on Friday from 2.58% on Thursday, while the yield on the 30-year fell one basis point to 3.34% from 3.35%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated at 104.0% on Friday compared to 105.6% on Thursday while the 30-year muni to Treasury ratio stood at 107.8% versus 108.1%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 57,679 trades on Friday on volume of $16.56 billion.
Prior Week's Actively Traded Issues
Revenue bonds comprised 60.48% of new issuance in the week ended Dec. 2, up from 59.78% in the previous week, according to
Some of the most actively traded issues by type were from California and New Jersey. In the GO bond sector, the California 5s of 2034 were traded 28 times. In the revenue bond sector, the New Jersey Economic Development Authority 4s of 2041 were traded 99 times. And in the taxable bond sector, the California 7.6s of 2040 were traded 20 times.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Morgan Stanley, Barclays Capital, Citigroup, Wells Fargo Securities and Bank of America Merrill Lynch, according to Thomson Reuters data. In the week of Nov. 27-Dec. 3, Morgan Stanley underwrote $2.05 billion, Barclays $1.69 billion, Citi $834.9 million, Wells Fargo $735.4 million and BAML $683.3 million.
Primary Market
New York City is coming to market with over $1 billion of general obligation bonds in negotiated and competitive deals this week.
Jefferies is expected to hold a two-day retail order period starting on Monday for the $800.25 million of Fiscal 2008 and 2017 bonds before the institutional pricing on Wednesday.
About $650 million of the deal will fund capital projects and $152 million will convert index-rate bonds to fixed-rate, the city said.
Also on Wednesday, NYC will competitively sell $200 million of taxable GOs in two separate offerings.
The deals are rated Aa2 by Moody's Investors Service and AA by S&P Global Ratings and Fitch Ratings.
Bank of America Merrill Lynch is set to price the Massachusetts Department of Transportation's $445 million of Series 2016A metropolitan highway system senior revenue refunding bonds for retail investors on Monday ahead of the institutional pricing on Tuesday.
The deal is rated A3 by Moody's and A-plus by S&P and Fitch.
BAML is also slated to price Massachusetts DOT's $197 million of Series 2016A metropolitan highway system revenue refunding bonds, subordinated commonwealth contract assistance secured, on Monday for retail ahead of the institutional pricing on Tuesday.
This deal is rated Aa2 by Moody's and AA-plus by S&P and Fitch.
William Blair & Co. is set to price Connecticut's $320 million of Series 2016G GO refunding bonds on Monday for retail ahead of the institutional pricing on Tuesday. The deal is rated Aa3 by Moody's and AA-minus by S&P and Fitch.
On Tuesday, JPMorgan Securities is expected to price the Phoenix Civic Improvement Corp., Ariz.'s $381 million of Series 2016 junior lien water system revenue refunding bonds.
The deal is rated Aa2 by Moody's and triple-A by S&P.
RBC Capital Market is set to price the Minneapolis-St. Paul Metropolitan Airports Commission's $226 million of Series 2016C non-AMT senior airport revenue bonds and Series 2016D AMT subordinate airport revenue bonds. The senior bonds are rated AA-minus by S&P and Fitch and the subordinate bonds are rated AA-plus by S&P and Fitch.
In the competitive arena on Monday, Washington County, Ore., is selling $105.73 million of Series 2016B full faith and credit obligations.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $171.5 million to $15.08 billion on Monday. The total is comprised of $3.70 billion of competitive sales and $11.38 billion of negotiated deals.
