Municipal bond traders are set to see $7.7 billion of new issues come to market this week, topped by a big water deal from an issuer in California.
Secondary Market
U.S. Treasuries were narrowly mixed on Monday. The yield on the two-year Treasury was unchanged from 0.89% on Friday, while the 10-year Treasury yield fell to 1.83% from 1.85% and the yield on the 30-year Treasury bond decreased to 2.63% from 2.64%.
Top-rated municipal bonds finished mixed on Friday. The yield on the 10-year benchmark muni general obligation rose one basis point to 1.63% from 1.62% on Thursday while the 30-year muni yield fell two basis points to 2.43% from 2.45%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated at 88.3% on Friday compared to 87.9% on Thursday, while the 30-year muni to Treasury ratio stood at 92.2% versus 93.0%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 30,146 trades on Friday on volume of $9.41 billion.
Prior Week's Actively Traded Issues
Revenue bonds comprised 53.32% of new issuance in the week ended May 20, up from 53.27% in the previous week, according to data released by
General obligation bonds comprised 39.62% of total issuance, up from 38.98%, while taxable bonds made up 7.06%, down from 7.75%.
Some of the most actively traded issues by type were from Puerto Rico and New York issuers.
In the GO bond sector, the Puerto Rico commonwealth 8s of 2035 traded 44 times. In the revenue bond sector, the New York TDC LaGuardia 5s of 2046 traded 139 times. And in the taxable bond sector, the New York TDC LaGuardia 3.673s of 2030 traded 30 times, Markit said.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Citigroup, BAML, Piper Jaffray, Goldman Sachs and RBC Capital Markets, according to Thomson Reuters data. In the week of May 15-21, Citi underwrote $3.07 billion, BAML $2.05 billion, Piper had $986 million, Goldman did $811 million and RBC had $773 million.
Primary Market
The upcoming calendar is composed of $5.44 billion of negotiated deals and $2.23 billion of competitive sales.
The biggest deal of the week is coming from the San Diego Public Facilities Financing Authority. JPMorgan Securities is expected to price the $567.96 million of Series 2016A and 2016B subordinated water revenue bonds on Wednesday. The deal is rated Aa3 by Moody's Investors Service and AA-minus by Fitch Ratings.
On Tuesday, PNC Capital Markets is set to price the Pennsylvania Turnpike Commission's $545.14 million of second series of 2016 subordinate revenue refunding bonds. The deal is rated A3 by Moody's and A-minus by Fitch.
Bank of America Merrill Lynch is expected to price the state of Connecticut's $500 million of Series 2016B general obligation refunding bonds on Tuesday. Connecticut's GOs are rated Aa3 by Moody's, AA-minus by S&P Global Ratings and Fitch, and AA by Kroll Bond Rating Agency.
RBC Capital Markets is expected to price the Massachusetts Educational Financing Authority's $340 million of Series 2016 Issue J education loan revenue bonds, subject to the alternative minimum tax. The deal is rated AA by S&P and A by Fitch.
RBC is also set to price Miami-Dade County, Fla.'s $339.34 million of GOs for the building better communities program. The bonds are rated Aa2 by Moody's and AA by S&P.
In the competitive arena on Tuesday, Denton, Texas, is selling $112.19 million of securities in two separate sales consisting of $83.23 million of Series 2016 certificates of obligation and $28.96 million of Series 2016 GO refunding and improvement bonds. Both deals are rated AA-plus by S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $36.6 million to $13.82 billion on Monday. The total is comprised of $6.82 billion of competitive sales and $6.99 billion of negotiated deals.
