Municipal market participants won't have much volume to work with this week, as recent market volatility and a holiday shortened week factor into an extremely light $1.04 billion week.
Secondary Market
U.S. Treasuries were narrowly mixed on Monday morning. The yield on the two-year was unchanged from 1.06% on Friday, the 10-year Treasury fell to 2.32% from 2.33%, while the yield on the 30-year Treasury bond decreased to 3.00% from 3.02%.
Municipal bonds finished Friday weaker, as the yield on the 10-year benchmark muni general obligation was five basis points higher to 2.26% from 2.21% on Thursday, while the yield on the 30-year increased by two basis points to 3.03% from 3.01%, according to a final read of Municipal Market Data's triple-A scale.
Since Election Day, muni yields have risen as much as 55 basis points. On Tuesday, Nov. 8, the 10-year muni yield stood at 1.71% while the 30-year yield was at 2.54%.
The 10-year muni to Treasury ratio was calculated at 96.9% on Friday compared to 97.2% on Thursday, while the 30-year muni to Treasury ratio stood at 100.5% versus 100.7%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 46,107 trades on Friday on volume of $15.34 billion.
Prior Week's Actively Traded Issues
Revenue bonds comprised 59.44% of new issuance in the week ended Nov. 18, up from 58.86% in the previous week, according to Markit. General obligation bonds comprised 35.51% of total issuance, down from 35.83%, while taxable bonds made up 5.05%, down from 5.31%.
Some of the most actively traded issues by type were from California and North Carolina, according to Markit. In the GO bond sector, the California state 4s of 2035 were traded 20 times. In the revenue bond sector, the University of North Carolina at Chapel Hill Hospital 4s of 2046 were traded 64 times. And in the taxable bond sector, Los Angeles Department of Airports 3.887s of 2038 were traded 45 times.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Bank of America Merrill Lynch, Morgan Stanley, Wells Fargo Securities, Stifel and Piper Jaffray, according to Thomson Reuters data. In the week of Nov. 13-Nov. 19, BAML underwrote $1.29 billion, Morgan Stanley $1.28 billion, Wells Fargo $721.5 million, Stifel $688.9 million and Piper Jaffray $630.2 million.
Primary Market
The upcoming slate is composed of $897 million of negotiated bond deals and $145 million of competitive bond sales. The week will be shorted to essentially two days, with Thanksgiving coming on Thursday.
JPMorgan is scheduled to price the state of New York Mortgage Agency's $97.615 million of homeowner mortgage revenue bonds, consisting of both alternative minimum tax and non-AMT for retail investors on Monday, proceeding institutional pricing on Tuesday. The deal is rated Aa1 by Moody's Investors Service.
A bunch of deals that were originally expected to price last week are now on the day-to-day calendar, as market volatility from post-presidential election jitters rocked the market as yields shot up 22 basis points on Monday, Nov. 14.
Among those deals were $1.024 billion of New York's Tobacco Settlement bonds, Public Hospital District No. 1 of King County, Wash.'s $186 million of limited tax general obligation bonds, Montgomery County Municipal Utility District No. 13, Texas' $141 million of road and limited tax refunding bonds and Mississippi's $223 million of GO refunding bonds.
There are no scheduled competitive deals larger than $100 million.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $1.32 billion to $8.06 billion on Monday. The total is comprised of $2.57 billion of competitive sales and $5.49 billion of negotiated deals.
