Municipal bond traders are set to see the first of the week’s big new issues come to market on Tuesday, with issuers in New York and Ohio leading the pack.
Secondary Market
U.S. Treasuries were weaker on Tuesday. The yield on the two-year Treasury climbed to 0.71% from 0.70% on Monday, while the 10-year Treasury yield rose to 1.75% from 1.73% and the 30-year Treasury bond yield increased to 2.58% from 2.56%.
Top quality municipal bonds finished slightly weaker on Monday. The yield on the 10-year benchmark muni general obligation rose one basis point to 1.60% from 1.59% on Friday, while the 30-year muni yield increased one basis point to 2.55% from 2.54%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated at 92.9% on Monday compared with 92.6% on Friday, while the 30-year muni to Treasury ratio stood at 99.6% versus 99.5%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 33,908 trades on Monday on volume of $7.08 billion.
Primary Market
This week’s $6.13 billion calendar consists of $4.11 billion of negotiated deals and $2.02 billion of competitive sales.
The sales kick off on Tuesday, as the New York City Transitional Finance Authority is set to competitively sell $750 million of bonds in three separate offerings.
The NYC TFA deals consist of $500 million of Fiscal 2016 Series F Subseries F-3 future tax secured tax-exempt subordinate bonds; $199.525 million of Fiscal 2016 Series F Subseries F-1 future tax secured taxable subordinate bonds; and $50.525 million of Fiscal 2016 Series F Subseries F-2 future tax secured taxable subordinate bonds.
Also on Tuesday, Las Vegas, Nev., will competitively sell $138 million of bonds in three offerings, consisting of $82.46 million of Series 2016A limited tax general obligation performing arts center refunding bonds additionally secured by pledged revenues; $39.66 million of Series 2016B limited tax GO various purpose refunding bonds additionally secured by pledged revenues; and $16.19 million of Series 2016C limited tax GO sewer refunding bonds additionally secured by pledged revenues. The deals are rated Aa2 by Moody’s and AA by S&P.
The Platte River Power Authority, Colo., will competitively sell $154.6 million of Series JJ power revenue bonds on Tuesday. The deal is rated AA by S&P and Fitch.
In the negotiated sector, Loop Capital Markets is expected to price the state of Ohio’s $231 million of Series S general obligation highway capital improvement bonds, backed by its full faith and credit and highway user receipts. The deal is rated Aa1 by Moody’s Investors Service, triple-A by Standard & Poor’s and AA-plus by Fitch Ratings.
Also on Tuesday, Ziegler is expected to price the Illinois Finance Authority’s $107.38 million of Series 2016 A&B revenue bonds for the Presbyterian Homes Obligated Group. The Series A bonds are rated A-minus by Fitch while the Series B bonds are rated triple-B-plus by S&P and A-minus by Fitch.
On Wednesday, Morgan Stanley is set to price the California Infrastructure and Economic Development Bank’s $4124 million of clean water state revolving fund revenue green bonds. The deal is rated triple-A by Moody’s, S&P and Fitch.
Since 2006, the IEDB has issued over $6.6 billion of debt, with the most issuance occurring in 2008 when $1.87 billion of bonds were sold. The least amount of debt was offered in 2012 when $265 million of bonds were sold.
Also on Wednesday, Goldman Sachs is expected to price the Orange County Health Facilities Authority, Fla.’s $257 million of Series 2016A hospital revenue refunding bonds for the Orlando Health Obligated Group. The deal is rated A2 by Moody’s and A by S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $2.693 billion to $12.93 billion on Tuesday. The total is comprised of $5.23 billion of competitive sales and $7.70 billion of negotiated deals.
