Municipal bond traders are set to see the last of the week's big new issues come to market on Thursday, led by issuers in New York and the Midwest.
Secondary Market
U.S. Treasuries were narrowly mixed on Thursday. The yield on the two-year Treasury inched up to 0.91% from 0.90% on Wednesday, while the 10-year Treasury yield was unchanged from 1.86% and the yield on the 30-year Treasury bond decreased to 2.66% from 2.68%.
Top quality municipal bonds finished weaker on Wednesday. The yield on the 30-year general obligation rose six basis points to 2.45%, up from Tuesday's record low of 2.39%, according to the final read of Municipal Market Data's triple-A scale. The yield on the 10-year benchmark muni increased six basis points to 1.60% from 1.54% on Tuesday, according to MMD.
The 10-year muni to Treasury ratio was calculated at 85.1% on Wednesday compared to 87.6% on Tuesday, while the 30-year muni to Treasury ratio stood at 91.3% versus 92.4%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 40,793 trades on Wednesday on volume of $14.82 billion.
Primary Market
Roosevelt & Cross is set to price for institutions the Dormitory Authority of the State of New York's $206.48 million of Series E, F, G, H, I and J revenue bonds under the school districts revenue bond financing program after a retail order period on Wednesday.
The $79.68 million of Series 2016E bonds were priced for retail to yield from 0.74% with a 2% coupon in 2017 to 2.58% with a 5% coupon in 2036; a 2041 maturity was priced as 3s to yield 3.11% and a 2044 maturity was priced as 3s to yield 3.14%. This series is rated A-plus by S&P Global Ratings and AA-minus by Fitch Ratings except for the 2041 and 2044 maturities which are insured by Build America Mutual and rated AA by S&P.
The $41.71 million of Series 2016F bonds were priced to yield from 0.67% with a 2% coupon in 2017 to 2.51% with a 5% coupon in 2036; a 2041 maturity was priced as 3s to yield 3.08% and a 2043 maturity was priced as 3s to yield 3.10%. This series is rated AA by S&P and AA-minus by Fitch.
The $36.87 million of Series 2016G bonds were priced to yield from 0.68% with a 2% coupon in 2017 to 2.25% with a 5% coupon in 2031. This series is rated AA-minus by S&P and Fitch.
The $21.37 million of Series 2016H bonds were priced to yield from 0.68% with a 2% coupon in 2017 to 2.25% with a 5% coupon in 2031. This series is rated Aa3 by Moody's Investors Service and AA-minus by Fitch.
The $10.07 million of Series 2016I bonds were priced to yield from 0.84% with a 2% coupon in 2017 to 2.64% with a 2.50% coupon in 2031. This series is rated A-plus by S&P and AA-minus by Fitch except for the 2019-2031 maturities which are insured by Assured Guaranty Municipal and rated AA by S&P.
The $16.80 million of Series 2016J bonds were priced to yield from 0.84% with a 2% coupon in 2017 to 2.30% with a 5% coupon in 2029. This series is rated A-plus by S&P and AA-minus by Fitch except for the 2020-2029 maturities which are insured by AGM and rated AA by S&P.
Morgan Stanley is set to price the Illinois Finance Authority and the Iowa Finance Authority's $214.84 million of Series 2016D health facilities revenue bonds for UnityPoint Health.
Raymond James is set to price the Indianapolis Local Public Improvement Bond Bank's $167.38 million of Series 2016A refunding bonds for the Indianapolis Airport Authority project, Series 2016A-1 AMT and Series 2016-2 non-AMT. The deal is rated A1 by Moody's and A by S&P and Fitch.
In the competitive arena, the Clark County School District, Nev., is selling $315.94 million of bonds in three separate sales. The sales consist of $188.84 million of Series 2016A limited tax general obligation refunding bonds, $92.61 million of Series 2016B limited tax GO refunding bonds additionally secured by pledged revenues, and $34.5 million of Series 2016C limited tax GO mid-term bonds.
All three deals are rated A1 by Moody's and AA-minus by S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $1.93 billion to $11.61 billion on Thursday. The total is comprised of $5.66 billion of competitive sales and $5.94 billion of negotiated deals.
Tax-Exempt Money Market Funds See Outflows
Tax-exempt money market funds experienced outflows of $2.55 billion, bringing total net assets to $212.39 billion in the week ended May 16, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $1.10 billion to $214.94 billion in the previous week.
The average, seven-day simple yield for the 296 weekly reporting tax-exempt funds rose to 0.06% from 0.05% in the previous week.
The total net assets of the 894 weekly reporting taxable money funds decreased $16.29 billion to $2.477 trillion in the week ended May 17, after an inflow of $10.54 billion to $2.494 trillion the week before.
The average, seven-day simple yield for the taxable money funds was unchanged from 0.10% in the prior week.
Overall, the combined total net assets of the 1,190 weekly reporting money funds decreased $18.84 billion to $2.690 trillion in the period ended May 17, which followed an inflow of $9.44 billion to $2.709 trillion.
