The municipal bond market is looking at a $6.87 billion new issue calendar this week, dominated by the state of California’s $2.5 billion general obligation bond deal.

Secondary market
Treasuries were narrowly mixed on Monday. The yield on the two-year Treasury was flat from 1.33% on Friday, the 10-year Treasury yield gained to 2.18% from 2.17% and the yield on the 30-year Treasury bond increased to 2.77% from 2.75%.

Top-rated municipal bonds finished flat on Friday. The yield on the 10-year benchmark muni general obligation was unchanged from 1.88% on Thursday, while the 30-year GO yield was steady from 2.73%, according to the final read of Municipal Market Data's triple-A scale.

On Friday, the 10-year muni-to-Treasury ratio was calculated at 86.7%, compared with 85.8% on Thursday, while the 30-year muni-to-Treasury ratio stood at 99.2% versus 98.6%, according to MMD.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 28,491 trades on Friday on volume of $6.72 billion.

Prior week's actively traded issues
Revenue bonds comprised 55.53% of new issuance in the week ended Aug. 18, down from 56.01% in the previous week, according to Markit. General obligation bonds made up 37.43% of total issuance, up from 37.35%, while taxable bonds accounted for 7.04%, up from 6.64%.

Some of the most actively traded bonds by type in the week were from California, Texas and New Jersey issuers.

In the GO bond sector, the California 5s of 2039 were traded 27 times. In the revenue bond sector, the Texas 4s of 2018 were traded 371 times. And in the taxable bond sector, the Bergen County Improvement Authority, N.J., 2.25s of 2019 were traded 24 times.

Previous week's top underwriters
The top municipal bond underwriters of last week included Bank of America Merrill Lynch, Piper Jaffray, Citigroup, Wells Fargo Securities, and Morgan Stanley, according to Thomson Reuters data.

In the week of Aug. 20 to Aug. 26, BAML underwrote $558.3 million, Piper Jaffray $536.4 million, Citi $504.1 million, Wells Fargo $426.1 million, and Morgan Stanley $381.9 million.

Primary market
This week’s slate is composed of $5.77 billion of negotiated deals and $1.10 billion of competitive sales.

Action kicks off Monday as Goldman Sachs gets ready to price California’s $2.5 billion of various purpose GOs for retail investors ahead of the institutional pricing on Tuesday.

The deal is rated Aa3 by Moody’s Investors Service and AA-minus by S&P Global Ratings and Fitch Ratings.

Also Monday, Bank of America Merrill Lynch will price for retail investors the Illinois Finance Authority’s $558 million of Series 2017 revolving fund revenue bonds under the state of Illinois' clean water initiative. The issue will be priced for institutions on Tuesday.

The deal is rated AAA by S&P and Fitch.

BAML will also price the Oregon Department of Housing and Community Services’ $107 million of single-family mortgage revenue bonds for retail investors ahead of the institutional pricing on Tuesday.

The deal, which consists of Series 2017D bonds not subject to the alternative minimum tax and Series 2017E AMT bonds, is rated Aa2 by Moody’s.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar increased $520.2 million to $9.59 billion on Monday. The total is comprised of $3.20 billion of competitive sales and $6.39 billion of negotiated deals.

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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.