Municipal bond traders are set to see more deals price in the primary on Wednesday after the biggest deal of the year to date came to market on Tuesday when California sold $2.9 billion of general obligation bonds.
Secondary Market
Treasuries were lower on Wednesday. The yield on the two-year Treasury rose to 0.89% from 0.87% on Tuesday, while the 10-year Treasury yield gained to 1.89% from 1.83% and the 30-year Treasury bond yield increased to 2.67% from 2.63%.
Top quality municipal bonds finished stronger on Tuesday. The yield on the 10-year benchmark muni general obligation fell two basis points to 1.88% from 1.90% on Monday, while the 30-year muni yield fell four basis points to 2.86% from 2.90%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Tuesday at 102.6% compared to 100.0% on Monday, while the 30-year muni to Treasury ratio stood at 108.5% versus 107.4%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,984 trades on Tuesday on volume of $8.05 billion.
Primary Market
On Wednesday, the New Jersey Educational Facilities Authority is competitively selling two issues totaling $217.22 million. The deals consist of $117.22 million of Series 2016B Princeton University revenue refunding bonds and $100 million of Series 2016A Princeton University revenue bonds. Both issues are rated triple-A by Moody’s Investors Service and Standard & Poor’s.
Alaska is set to competitively sell $134.79 million of Series 2016A general obligation bonds. The deal is rated Aa1 by Moody’s, AA-plus by S&P and AAA by Fitch Ratings.
Since 2006, Alaska has issued bonds an average of 2.3 times a year, selling about $1.8 billion, with the largest issuances in 2006 and 2010 when it offered $413 million and $371 million, respectively. The lows came in 2007 and 2008, when the 49th state of the U.S. did not issue any bonds.
Mesirow Financial is expected to price Sweetwater Union High School, Calif.’s $264.5 million of GOs on Wednesday. The deal is rated A1 by Moody’s A-plus by S&P and triple-A by Fitch.
Ramirez & Co. is set to price Ohio Water Development Authority’s $160 million of Fresh Water Series 2016A water development revenue bonds on Wednesday. The deal is rated triple-A by Moody’s and S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $2.14 billion to $10.08 billion on Wednesday. The total is comprised of $2.80 billion of competitive sales and $7.28 billion of negotiated deals.
