The municipal bond market is in store for more volume as the last of the week’s bigger sales are set to hit the screens on Thursday.
U.S. Treasuries were weaker on Thursday. The yield on the two-year Treasury rose to 1.31% from 1.27% on Wednesday as the 10-year Treasury yield gained to 2.24% from 2.20% while the yield on the 30-year Treasury bond increased to 2.89% from 2.86%.
Municipal bond ended stronger on Wednesday. The yield on the 10-year benchmark muni general obligation fell three basis points to 1.90% from 1.93% on Tuesday, while the 30-year GO yield dropped three basis points to 2.74% from 2.77%, 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 92.5%, compared with 87.2% on Tuesday, while the 30-year muni to Treasury ratio stood at 95.8%, versus 96.0%, according to MMD.
MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 39,763 trades on Wednesday on volume of $12.16 billion.
Morgan Stanley will price Connecticut’s $370 million of state revolving fund general revenue bonds for institutions after holding a one-day retail order period.
The $250 million of Series 2017A SRF green bonds were priced for retail to yield from 1.02% with a 3% coupon in 2020 to 3.08% with 3% and 4% coupons in a split 2036 maturity. The 2018 and 2019 maturities were offered as sealed bids. No retail orders were taken in the 2029-2032, 2034-2035 or 2037 maturities.
The $120 million of Series 2017B refunding bonds were priced for retail as 5s to yield 1.16% in 2021 and 1.46% in 2023. No retail orders were taken in the 2020, 2022 or 2024-2027 maturities.
The deal is rated triple-A by Moody’s Investors Service, S&P Global Ratings and Fitch Ratings.
Since 2007, the Constitution State has sold roughly $30.69 billion of securities, with the most issuance occurring in 2008 when it sold $4.21 billion. The state has sold more than $1 billion every year for the past decade and has sold more than $3 billion in a year five times. The lowest issuance year came in 2007, when it sold $1.38 billion.
JPMorgan Securities is expected to price the Colorado High Performance Transportation Enterprise’s $165.5 million of Series 2017 C-470 express lane senior revenue bonds. The deal has a provision BBB rating from DBRS.
RBC Capital Markets is expected to price the Massachusetts Educational Financing Authority’s $162.23 million of Series 2017 Issue K education loan revenue bonds. The deal consists of Series 2017A senior series bonds, rated AA by S&P and Fitch, and Series 2017B subordinate series bonds, rated A by S&P.
In the competitive arena, Loudoun County, Va., is selling $108.13 million of Series 2017A general obligation public improvement bonds.
The deal is rated triple-A by Moody’s, S&P and Fitch.
Also on Thursday, Nassau County, N.Y., is competitively selling $90.53 million of Series 2017B general improvement bonds.
The deal is rated A2 by Moody’s, A-plus by S&P and A by Fitch.
Bond Buyer 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $1.45 billion to $11.09 billion on Thursday. The total is comprised of $5.39 billion of competitive sales and $5.70 billion of negotiated deals.
Tax-Exempt Money Market Fund outflows
Tax-exempt money market funds experienced outflows of $347.4 million, lowering total net assets to $129.33 billion in the week ended May 29, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $169.2 million to $129.68 billion in the previous week.
The average, seven-day simple yield for the 232 weekly reporting tax-exempt funds held frim at 0.32% from the previous week.
The total net assets of the 855 weekly reporting taxable money funds increased $8.66 billion to $2.498 trillion in the week ended May 30, after an inflow of $5.56 billion to $2.489 trillion the week before.
The average, seven-day simple yield for the taxable money funds increased to 0.46% from 0.45% last week.
Overall, the combined total net assets of the 1,087 weekly reporting money funds increased $8.31 billion to $2.627 trillion in the week ended May 30, after inflows of $5.73 billion to $2.619 trillion in the prior week.