Prices of top-rated municipal bonds were stronger at mid-session, traders said, with yields on some maturities weakening by as much as three basis points.
In the primary, traders saw some new deals hit the screens from issuers in California and Washington state.
Secondary Trading
The yield on the 10-year benchmark muni general obligation on Tuesday was from one to three basis points weaker from 2.06% on Monday, while the yield on the 30-year GO was from one to three basis points weaker from 3.07%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were mixed on Tuesday, with the yield on the two-year Treasury note falling to 0.66% from 0.67% on Monday, while the 10-year yield fell to 2.08% from 2.09% and the 30-year yield increased to 2.88% from 2.86%.
The 10-year muni to Treasury ratio was calculated on Monday at 98.4% versus 96.5% on Friday, while the 30-year muni to Treasury ratio stood at 107.0% compared to 104.8%, according to MMD.
Primary Market
RBC Capital Markets priced the California State of Public Works Board's $555.54 million of Series 2015F and 2015G lease revenue refunding bonds.
The $433.3 million of Series 2015F Department of General Services' various state office buildings bonds were priced to yield from 0.25% with a 3% coupon in 2016 to 3.05% with a 5% coupon in 2030. The $122.24 million of Series 2015G Department of Public Health's Richmond Laboratory bonds were priced to yield from 0.58% with a 2% coupon in 2017 to 3.47% with a 3.375% coupon in 2031.
The bonds are rated A1 by Moody's Investors Service, A-plus by Standard & Poor's and A by Fitch Ratings.
Bank of America Merrill Lynch priced Energy Northwest, Wash.'s $107.63 million of Series 2015C Project 1 electric revenue refunding bonds, electric revenue refunding bonds for the Columbia Generation Station and Project 3 electric revenue refunding bonds.
The $42.11 million of Project 1 bonds were priced as 3s and 5s to yield 2.32% in a split 2025 maturity. The $38.72 million of Columbia Generating bonds were priced as 5s to yield 2.87% in 2030 and 2.94% in 2031. The $26.81 million of Project 3 bonds were priced as 5s to yield 2.47% in 2026.
The issue is rated Aa1 by Moody's, AA-minus by S&P and AA by Fitch.
Washington state this week is offering about $983 million of bonds, which are made up of four competitive sales and one negotiated deal.
On Tuesday, Bank of America Merrill Lynch repriced and restructured the state's $53 million of Series 2016A-2 various purpose general obligation green bonds.
The issue was upsized from the $39 million tentatively priced on Monday and was repriced to yield from 0.27% with a 2% coupon in 2016 to 2.30% with a 5% coupon in 2025. A 2030 maturity was priced as 3s to yield 3.20%; a 2035 maturity was priced as 3 3/8s to yield 3.55%; and a 2040 maturity was priced as 3 3/4s to yield 3.76%.
On Wednesday, the Evergreen State will be selling four competitive issues consisting of $61 million of Series 2016T GO taxable bonds, $192 million of Series 2016B motor fuel tax GOs, $194 million of Series R-2016A various purpose GO refunding bonds, and $498 million of Series 2015A-1 various purpose GOs.
All of the issues are rated Aa1 by Moody's and AA-plus by S&P and Fitch.
Including this week's issues, the state has sold about $41 billion of debt since 1995, with the biggest offerings coming in 2010 and 2012 when it sold $3.4 billion and $3.5 billion, respectively. The lowest years of issuance were in 1996 and 1998 when the state offered $550 million and $546 million, respectively.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 31,962 trades on Monday on volume of $5.353 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $4.94 billion to $12.89 billion on Tuesday. The total is comprised of $3.56 billion competitive sales and $9.34 billion of negotiated deals.
