Prices of top-rated municipal bonds were flat at mid-session, traders said, with yields on all maturities remaining unchanged.
Meanwhile, the market is awaiting the last of the week's big new issue supply on Thursday, with issuers from New York, California, Wisconsin and North Carolina topping the calendar.
Primary Market
Jefferies and RBC Capital Markets priced the State of New York Dormitory Authority's $124.64 million of school district revenue and financing program revenue bonds, Series 2015 D, E and F. The bonds in all three series are insured by Build America Mutual Assurance Co., and are rated AA by Standard & Poor's.
The $84.05 million of Series D bonds were priced to yield from 0.67% with a 3% coupon in 2016 to 3.90% with a 3.75% coupon in 2034. The $13.33 million of Series E bonds were priced to yield from 0.67% with a 3% coupon in 2016 to 3.68% with a 3.5% coupon in 2030. The $27.26 million of Series F bonds were priced to yield from 0.87% with a 4% coupon in 2016 to 3.60% with a 3.375% coupon in 2028.
Citi and Goldman, Sachs received the written award on the North Carolina Department of Transportation's $100 million of Series 2015 tax-exempt private activity revenue bonds for the I-77 HOT Lanes project. The PABs, which are subject to the alternative minimum tax, were priced as 5s to yield from 3.72% in 2026 to 4.11% in 2030; a 2037 term bond was priced as 5s to yield 4.31% and a 2054 term was priced as 5s to yield 4.65%. The issue was rated BBB-minus by Fitch and BBB by DBRS.
In the competitive arena, the Santa Clara Unified School District, Calif., sold two separate offerings totaling $243.45 million. Both sales are rated AA by S&P.
Bank of America won the $140.7 million of Series 2015 election of 2014 GO refunding bonds with a true interest cost of 3.60%. Pricing information was not immediately available. Morgan Stanley won the $102.75 million of Series 2015 general obligation refunding bonds with a TIC of 3.27%. Pricing information was not immediately available.
Also on Thursday, Milwaukee competitively sold a $166.11 million single-issue of GOs consisting of $137.54 million Series 2015 N2 GO promissory notes and $28.57 million of Series 2015 B3 GO corporate purpose bonds. Bank of America Merrill Lynch won the issue with a true interest cost of 2.54%. The deal was priced to yield from 0.21% with a 2% coupon in 2016 to yield 3.73% with a 4% coupon in 2032. The issue was rated Aa3 by Moody's and AA by both S&P and Fitch.
Milwaukee also sold $125 million Series 2015 R1 revenue anticipation notes. TD Securities won the issue with an effective rate of 0.1413% and a premium of $610,750. The notes are due Dec. 23 and carry a coupon of 1.00% The RANs were rated MIG-1 by Moody's, SP1-plus by S&P and F1-plus by Fitch.
Secondary Market
The yield on the 10-year benchmark muni general obligation on Thursday was flat from 2.24% on Wednesday, while the yield on the 30-year GO was flat at 3.23%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were higher on Thursday as the yield on the two-year Treasury note dropped to 0.56% from 0.58% on Wednesday, while the 10-year yield declined to 2.24% from 2.28% and the 30-year yield decreased to 3.06% from 3.07%.
The 10-year muni to Treasury ratio was calculated on Wednesday at 98.2% versus 99.2% on Tuesday, while the 30-year muni to Treasury ratio stood at 105.2% compared to 106.5%, according to MMD.
Tax-Exempt Money Market Funds Post Outflow
Tax-exempt money market funds reversed course and experienced outflows of $1.32 billion, bringing total net assets to $244.52 billion in the period ended May 11, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $1.16 billion to $245.84 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 106th straight week.
The total net assets of the 990 weekly reporting taxable money funds fell $6.99 billion to $2.376 trillion in the period ended May 12, after experiencing an inflow of $7.82 billion to $2.383 trillion in the prior week.
The average, seven-day simple yield for the taxable money funds remained at 0.02% for the 16th consecutive week.
Overall, the combined total net assets of the 1,385 weekly reporting money funds decreased $8.32 billion to $2.621 trillion in the period ended May 12, which followed an inflow of $8.98 billion to $2.629 trillion in the prior period.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $1.836 billion to $11.753 billion on Thursday. The total is comprised of $4.139 billion competitive sales and $7.614 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 45,974 trades on Wednesday on volume of $45.974 billion.
The most active bond, based on the number of trades, was the Calabasas, Calif.'s 2015 certificates of participation for the Civic Center project 4s of 2041, which traded 160 times at an average price of 100.389 with an average yield of 3.945%. The bonds were initially priced at 100.00 to yield 4.00%.
