Prices of top-rated municipal bonds were slightly weaker at mid-session, according to traders, with yields on some maturities up by as much as one basis point.
The muni market was looking ahead to next week's $8.2 billion of new supply, led by a large issue from a Hawaiian issuer.
Secondary Market
Prices of top-quality munis were weaker at midday. The yield on the 10-year benchmark muni general obligation was up as much as one basis point from 2.14% on Thursday, while the yield on 30-year GO was as much as one basis point higher from 2.94%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were mixed on Friday. The yield on the two-year Treasury note dropped to 0.64% from 0.66% on Thursday, while the 10-year yield rose to 2.10% from 2.09% and the 30-year yield increased to 2.69% from 2.67%.
On Thursday, the 10-year muni to Treasury ratio was calculated at 102.1% versus 103.3% on Wednesday, while the 30-year muni to Treasury ratio stood at 109.7% compared to 111.0%.
Primary Market
There are $6.9 billion of negotiated deals scheduled for sale next week and $1.3 billion of competitive sales slated.
Topping next week's negotiated calendar is the city and county of Honolulu, Hawaii's $879 million of Series A-D tax-exempt and Series E taxable general obligation bonds, scheduled to be priced on Tuesday by Bank of America Merrill Lynch.
Citigroup Global Markets is expected to price the North Carolina Medical Care Commission's $376 million of bonds for Vidant Health on Monday. The issue is expected to be structured as serials from 2016-35 with a 2039 term bond.
Citi is also scheduled to price the state of Oregon's $296 million of GOs, under Article XI for state projects on Wednesday.
And Goldman, Sachs is set to price the Illinois Finance Authority's $283 million of Series 2015C revenue refunding bonds for the Silver Cross Hospital and Medical Center on Tuesday.
The largest competitive bond sale during the week is slated for Wednesday - the Omaha Public School District No. 001, Neb.'s $141 million of Series 2015 GOs. The bonds, rated Aa1 by Moody's Investors Service and triple-A by Standard & Poor's, mature serially from 2024 to 2040. The school district last sold bonds competitively on July 11, 2001, when Merrill Lynch won $100 million of Series 2001B GOs with a true interest cost of 5.0372%.
The Week's Most Actively Quoted Issues
California, Georgia and Texas names were among the most actively quoted issues in the week ended March 13, according to data released by Markit.
Among bid-side quotes, the California 7.5s of 2034 were quoted by 10 unique dealers. Among ask-side quotes, the Atlanta, Ga., water and wastewater revenue 5s of 2040 were quoted by 14 dealers. And among two-sided quotes, the Texas 5s of 2044 were quoted by 10 dealers, Markit said.
The Week's Most Actively Traded Issues
Among the most actively traded issues in the week ended March 13, were issuers from California, Rhode Island and Connecticut, according to Markit.
In the GO bond sector, California 5s of 2045 were traded 67 times. In the revenue bond sector, the Rhode Island Tobacco Settlement Financing Corp. 5s of 2040 were traded 56 times. And in the taxable bond sector, the Hamden, Conn., 5.2s of 2044 were traded 34 times, according to Markit.
Tax-Exempt Bond Funds See Inflows
Municipal bond funds which report weekly posted $152.957 million of inflows in the week ended March 11, after experiencing inflows of $408.481 million in the week ended March 4, according to the latest Lipper data. It was the 10th straight week muni funds experienced inflows.
The four-week moving average remained positive at $262.454 million in the latest week after being in the green at $339.278 million in the prior week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.
Muni bond funds so far have experienced inflows in each week of 2015, according to Lipper data. Inflows for the year total about $5.789 billion.
Long-term muni bond funds saw inflows of $110.328 million in the latest week, after experiencing inflows of $200.363 million in the previous week.
High-yield muni funds recorded an outflow of $51.421 million in the latest reporting week, after seeing inflows of $124.114 million in the previous week. Exchange-traded funds had inflows of $75.130 million, after recording inflows of $83.539 million in the previous week.
In contrast, long-term municipal bond mutual funds posted $675 million of inflows in the week ended March 4, according to the Investment Company Institute. ICI reported that inflows into long-term funds were $1.003 billion in the previous week.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $554.7 million to $11.845 billion on Friday. The total is comprised of $2.681 billion competitive sales and $9.164 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,712 trades on Thursday on volume of $11.572 billion. Most active on Thursday, based on the number of trades, was the New York Metropolitan Transportation Authority Series 2015B transportation revenue 4s of 2025, which traded 402 times at an average price of 100.085 with an average yield of 3.984%; (initial offering price of 100.161 and an initial offering yield of yield of 3.980%).
