Munis were stronger on Tuesday morning, according to traders, as the yields on some maturities were as many as four basis points lower.
Municipal bond traders are anticipating a slow day, as the estimated volume for this week is just $1.5 billion.
Secondary Market
U.S. Treasuries were stronger on Tuesday morning. The yield on the two-year Treasury fell to 0.57% from 0.60% on Friday, while the 10-year Treasury yield declined to 1.39% from 1.46% and the yield on the 30-year Treasury bond decreased to 2.17% from 2.25%.
The yield on 10-year benchmark muni general obligation was between two and four basis points lower from 1.34% on Friday, while the 30-year muni yield was between two and four basis points lower from 1.99%, according to the first read of the day of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated at 91.8% on Friday compared to 91.0% on Thursday, while the 30-year muni to Treasury ratio stood at 88.5% versus 87.7%, according to MMD.
Primary Market
The primary market will be very quiet today, as no sizeable deals are scheduled to hit the market.
"With everyone having yesterday off, today is like a Monday and typically there is not much going on in the primary on Mondays," said a New York trader.
The majority of the week's issuance will be coming on Thursday, but there is one notable deal scheduled to hit the market tomorrow.
RBC Capital Markets is expected to price Chester County, Pa.'s, $97 million of general obligation bonds on Wednesday. The deal is rated triple-A by Moody's Investors Service, S&P Global Ratings and Fitch Ratings.
"It's great if you are an issuer right now, so I wouldn't be surprised if we saw some decent sized deals come to market that were not on the calendar," said the trader.
There is a $216.180 million competitive offering from the Florida Board of Education for public education capital outlay refunding bonds, listed on the day-to-day calendar on TM3. The deal is rated Aa1 by Moody's.
Prior Week's Actively Traded Issues
Revenue bonds comprised 51.89% of new issuance in the week ended July 1, down from 52.17% in the previous week, according to
Some of the most actively traded issues in the week by type were from Puerto Rico, New York and Massachusetts. In the GO bond sector, the Puerto Rico Commonwealth 8s of 2035 were traded 45 times. In the revenue bond sector, the N.Y. MTA 4s of 2036 were traded 82 times. And in the taxable bond sector, the Massachusetts 3.277s of 2046 were traded 80 times.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Bank of America Merrill Lynch, JP Morgan, Barclays, Raymond James and Citigroup, according to Thomson Reuters data. In the week of June 26-July 2, BAML underwrote $2.24 billion, JP Morgan $1.24 billion, Barclays $963 million, Raymond James $592 million and Citi $540 million.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 17,795 trades on Friday on volume of $7.219 billion.
