After a busy Tuesday, the muni market will pick up right where it left off: busy, as issuers frantically go to market to get certain deals done while they still can — as the tax bill continues to jump hurdles on the long path to becoming law.

Secondary market

  • The MBIS municipal non-callable 5% GO benchmark scale was weaker in early Wednesday morning trading.

The 10-year muni benchmark yield rose to 2.421% on Wednesday from the final read of 2.413% on Tuesday, according to Municipal Bond Information Services. The MBIS 30-year benchmark muni yield increased to 2.910% from 2.902% on Tuesday.

The MBIS benchmark index is updated hourly on the Bond Buyer Data Workstation.

  • U.S. Treasuries were mostly weaker on Wednesday morning. The yield on the two-year Treasury nudged up to 1.77% from 1.75%, the 10-year Treasury yield rose to 2.39% from 2.34% and the yield on the 30-year Treasury jumped to 2.82% from 2.77%.
  • Top-rated municipals ended weaker on Tuesday. The yield on the 10-year benchmark muni general obligation was four basis points higher to 2.16% from 2.12% on Monday, while the 30-year GO yield increased three basis points from to 2.82% from 2.79%, according to a final read of Municipal Market Data’s triple-A scale.
  • On Tuesday, the 10-year muni-to-Treasury ratio was calculated at 92.4% compared with 91.1% on Monday, while the 30-year muni-to-Treasury ratio stood at 101.9% versus 101.0%, according to MMD.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $221.3 million to $18.27 billion on Tuesday. The total is comprised of $6.40 billion of competitive sales and $11.87 billion of negotiated deals.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 44,253 trades on Tuesday on volume of $9.629 billion.

Primary market
Illinois is set to sell a total of $750 million of general obligation bonds in two competitive sales on Wednesday: $655 million and $95 million. Both offerings carry ratings of Baa3 from Moody’s Investors Service, BBB-minus from S&P Global Ratings and BBB from Fitch Ratings.

Since 2007, the Prairie State has issued over $35 billion of bonds, with the most issuance occurring in 2010 when it sold $8.68 billion of bonds. The state did not come to market in 2015. With Wednesday’s sales, this year becomes the second highest issuance total for the state in the past decade.

The only other notable competitive deal of the day will come from the Washington Suburban Sanitary District, which is expected to sell $190.05 million of consolidated public improvement refunding bonds. The deal is rated triple-A by Fitch.

On the negotiated side, Barclays is slated to price the Board of Regents of the University of Texas’ $360 million of revenue financing system bonds.

RBC is set to price the New York State Environmental Facilities Corp.’s $323.55 million of Series 2017E state clean water and drinking water revolving funds revenue bonds for New York City Municipal Water Finance Authority projects. The deal carries ratings of triple-A from Moody’s, S&P and Fitch.

One deal that was planned for Wednesday will no longer be coming. BAML was scheduled to price Maryland Stadium Authority’s $426.44 million of construction and revitalization program revenue bonds for the Baltimore City Public Schools has been delayed. According to a notice, the issuer decided to delay the transaction due to market conditions.

“This is a new-money transaction and does not need to be rushed, especially when market conditions are not pristine” said one market source. “In all likelihood, this transaction will now take place in 2018.”

Data appearing in this article from Municipal Bond Information Services, including the MBIS municipal bond index, is available on The Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Vanessa Kim at 212-803-8474 for more information.

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