Municipal bond traders are set to see the last of the week's big new issues come to market, topped by the sale of four competitive offerings from Columbus, Ohio.
Secondary Market
U.S. Treasuries were weaker on Thursday. The yield on the two-year Treasury rose to 0.72% from 0.71% on Wednesday as the 10-year Treasury yield gained to 1.62% from 1.58% and the yield on the 30-year Treasury bond increased to 2.35% from 2.30%.
Top-shelf municipal bonds finished steady to slightly weaker on Wednesday. The yield on the 10-year benchmark muni general obligation was unchanged from 1.45% on Tuesday, while the yield on the 30-year muni rose one basis point to 2.12% from 2.11%, according to the final read of Municipal Market Data's triple-A scale.
On Wednesday, the 10-year muni to Treasury ratio was calculated at 91.9% compared to 93.2% on Tuesday, while the 30-year muni to Treasury ratio stood at 92.4% versus 92.8%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 35,225 trades on Wednesday on volume of $12.77 billion.
Primary Market
In the competitive arena on Thursday, Columbus, Ohio, will sell four separate issues totaling almost $470 million. The deals consist of $372.32 million of Series 2016A various purpose unlimited tax bonds, $81.35 million of Series 2016B various purpose limited tax bonds, $13.36 million of Series 2016D taxable various purpose limited tax bonds and $2.58 million of Series 2016C taxable various purpose unlimited tax bonds.
All four deals are rated triple-A by Moody's Investors Service, S&P Global Ratings and Fitch Ratings.
In the negotiated sector, Morgan Stanley is expected to price Aurora, Colo.'s $426.91 million of Series 2016 first lien water refunding bonds. The deal is rated AA-plus by Fitch.
Since 2006, Aurora has issued about $1.5 billion of debt, with the largest issuance before this sale occurring in 2007 when it sold $422 million of securities. Aurora has barely come to market over the past 10 years and took a three-year hiatus from 2011-2013.
JPMorgan Securities is set to price the North Harris County Regional Water Authority, Texas' $259.21 million of Series 2016 senior lien revenue and refunding bonds. The deal is rated AA-minus by S&P and A-plus by Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $821.3 million to $11.13 billion on Thursday. The total is comprised of $4.38 billion of competitive sales and $6.75 billion of negotiated deals.
Tax-Exempt Money Market Fund Outflows
Tax-exempt money market funds experienced outflows of $1.25 billion, bringing total net assets to $188.42 billion in the week ended July 18, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $4.29 million to $189.67 billion in the previous week.
The average, seven-day simple yield for the 274 weekly reporting tax-exempt funds increased to 0.07% from 0.06% the previous week.
The total net assets of the 888 weekly reporting taxable money funds decreased $7.99 billion to $2.502 trillion in the week ended July 19, after an inflow of $22.22 billion to $2.510 trillion the prior before.
The average, seven-day simple yield for the taxable money funds was steady at 0.11% from the week before.
Overall, the combined total net assets of the 1,162 weekly reporting money funds decreased $9.24 billion to $2.691 trillion in the period ended July 19, which followed an inflow of $17.92 billion to $2.700 trillion.
