The municipal bond market was awaiting the last of the week's larger deals to come to market, with a competitive sale from Massachusetts and the institutional pricing of a New York issuer on tap for Thursday.
Secondary Market
Treasury prices were mixed on Thursday with the yield on the two-year Treasury note down to 0.56% from 0.57% on Wednesday, while the 10-year yield was unchanged at 2.05% and the 30-year yield rose to 2.76% from 2.75%.
The yield on the 10-year benchmark muni general obligation on Wednesday rose four basis points to 2.07% from 2.03% on Tuesday, while the yield on the 30-year GO was up five basis points to 3.00% from 2.95%, according to a read of MMD's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Wednesday at 101.8% versus 102.5% on Tuesday, while the 30-year muni to Treasury ratio stood at 109.5% compared to 110.2%, according to MMD.
Primary Market
Siebert, Brandford, Shank is slated to price the New York State Dormitory Authority's $266.84 million of State University of New York Series 2015A dormitory facilities revenue bonds for institutional investors on Thursday. A one-day retail order period was held on Wednesday.
The bonds were priced for retail to yield from 0.73% with 3% and 5% coupons in a split 2017 maturity to 3.79% with a 3.75% coupon in 2036. No retail orders were taken in the 2028-2032 or 2034 maturities. The 2016 maturity was offered as a sealed bid.
The SUNY issue is rated Aa3 by Moody's Investors Service and A-plus by Standard & Poor's and Fitch Ratings.
The state of Massachusetts is coming to market with two separate competitive sales of general obligation bonds totaling $550 million.
The offerings consist of $450 million of Series B consolidated loan of 2015 GOs and $100 million of consolidated loan of 2015 GOs. Proceeds will benefit various capital purposes.
The bonds are rated Aa1 by Moody's and AA-plus by Standard & Poor's and Fitch.
The sale was originally structured to include a taxable component, but this was changed during the sale process.
"We determined that we wouldn't need taxable proceeds," said Matthew T. Sheaff, communications director for state Treasurer Deborah Goldberg. "Because all of the bonds will be tax-exempt, that changed where and how much we wanted to place at particular spots on the curve."
The Bay State last sold bonds by competitive bid on Dec. 17, 2014, when it auctioned various issues.
Since 1995, Massachusetts has issued $47.22 billion of general obligation debt, with high years of issuance occurring in 2002 and 2005 when it issued $4.63 billion and $3.36 billion, respectively.
The Bay State saw low years of issuance in 1999 and 2008, when it issued only $995.2 million — the only year since 1995 when the commonwealth didn't issue at least $1 billion — and $1.2 billion, respectively.
Tax-Exempt Money Market Funds Post Outflow
Tax-exempt money market funds had an outflow of $5.36 billion, bringing total net assets to $244.69 billion in the period ended April 27, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $5.71 billion to $250.04 billion in the previous week.
The average, seven-day simple yield for the 395 weekly reporting tax-exempt funds remained at 0.01% for a 104th straight week.
The total net assets of the 990 weekly reporting taxable money funds rose $905.7 million to $2.375 trillion in the period ended April 28, after experiencing an outflow of $10.44 billion to $2.374 trillion in the prior week.
The average, seven-day simple yield for the taxable money funds remained at 0.02% for the 14th consecutive week.
Overall, the combined total net assets of the 1,385 weekly reporting money funds decreased $4.45 billion to $2.620 trillion in the period ended April 28, which followed an outflow of $16.15 billion to $2.624 trillion in the prior period.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 40,901 trades on Wednesday on volume of $13.299 billion.
The most active bond, based on the number of trades, was the Genesee County, Mich., limited tax Series 2015 water supply system revenue 4s of 2045, which traded 255 times at an average price of 99.458 with an average yield of 4.012%. The bonds were initially priced at 97.445 to yield 4.15%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $623.7 million to $7.805 billion on Thursday. The total is comprised of $4.481 billion competitive sales and $3.324 billion of negotiated deals.
