Prices of top-shelf municipal bonds were higher at mid-session, traders said, with yields on some maturities falling by as much as three basis points.
In the primary market, the New York City Transitional Finance Authority's $750 million deal was priced for retail investors.
Secondary Market
The yield on the 10-year benchmark muni general obligation on Monday was down from one to three basis points from 2.33% on Friday, while the yield on the 30-year GO was off from one to three basis points from 3.30%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were higher on Monday with the yield on the two-year Treasury note falling to 0.69% from 0.72% on Friday, while the 10-year yield decreased to 2.36% from 2.38% and the 30-year yield dropped to 3.08% from 3.10%.
The 10-year muni to Treasury ratio was calculated on Friday at 97.9% versus 98.2% on Thursday, while the 30-year muni to Treasury ratio stood at 109.1% compared to 106.9%, according to MMD.
Primary Market
There is $6.72 billion of new supply on tap this week, consisting of $5.52 billion of negotiated deals and $1.20 billion of competitive sales.
Goldman, Sachs kicked off the week's action and priced the New York City Transitional Finance Authority's $750 million of Series S-2 Fiscal 2015 building aid revenue bonds on Monday for retail investors. The new money BARBs will have a two-day retail order period and will be priced for institutions on Wednesday.
The bonds were priced to yield from 1.15% with 2% and 5% coupons in a split 2018 maturity to 3.45% with a 5% coupon in 2035; a 2044 term bond was priced as 4s to yield about 4.029%; a 2044 term bond was priced as 4s to yield about 4.029%. The 2016 and 2017 maturities were offered as sealed bids; no retail orders were taken in the 2028 through 2030 maturities, in the 2032 through 2034 maturities or in the 2040 and 2043 maturities.
Ramirez is co-senior manager on the sale, which are rated Aa2 by Moody's Investors Service and AA by Standard & Poor's and Fitch Ratings.
JPMorgan is slated to price the New York City Housing Development Corp.'s $563.85 million of multi-family housing revenue bonds for the Sustainable Neighborhood Program on Tuesday.
The issue is initially structured as $496.45 million of Series 2015 D-1 fixed-rate bonds, $64.14 million of Series 2015 D-2 fixed-rate bonds and $3.26 million of Series 2014 Series I fixed-rate bonds. The issue is rated Aa2 by Moody's and AA-plus by S&P.
The NYC HDC is also coming to market with a $40 million sale of taxable multi-family housing revenue bonds on Tuesday to be priced by Citi. The Sustainable Neighborhood bonds are initially structured as serials maturing from 2016 to 2025 and terms in 2030, 2035 and 2044.
Sustainable Neighborhood bonds are a new category of social investment bonds and the first for affordable housing in the United States.
JPMorgan is also expected to price the Monroe County, N.Y., Industrial Development Corp.'s $300.62 million of bonds for the University of Rochester on Tuesday. The issue is initially structured as $182.61 million of Series 2015A tax exempt bonds, $56.59 million of Series 2015B tax-exempt bonds and $61.43 million of Series 2015C taxable bonds.
Bank of America Merrill Lynch is set to price the Florida Municipal Power Agency's $277 million of Series 2015 B&C all requirements power supply project revenue and refunding bonds on Wednesday after a one day retail order period on Tuesday. The bonds are rated A2 by Moody's and A-plus by S&P.
Wells Fargo Securities is expected to price the Lamar Consolidated Independent School District, Texas' $211.59 million of unlimited tax schoolhouse refunding bonds on Wednesday. The bonds are expected to mature serially from 2018 through 2048. The issue is backed by the Permanent School Fund guarantee program and rated Aa2 by Moody's and AA by S&P.
Citi is slated to price Louisiana's Ochsner Clinic Foundation's $252 million of taxable corporate CUSIP bonds on Thursday. The issue is initially structured as a 2045 term bond. The bonds are rated Baa1 by Moody's and BBB-plus by S&P.
Additionally, Wayne County, Mich., is preparing to come to market with a $187 million note sale. The county hired Orrick, Herrington & Sutcliffe as special bankruptcy counsel on the deal, which expected to price on Thursday. Bond documents and an online investor road show on the deal both contain discussions on bankruptcy in the sections about investor risks.
In the competitive arena, Baltimore County, Md., will offer $97.89 million of Series 2015 Metropolitan District refunding bonds on Tuesday. The bonds are initially structured to mature serially from 2016 through 2026.
The county last sold comparable bonds competitively on June 25, 2012, when BAML won $74.61 million of Series 2014C Metropolitan District refunding bonds.
Also on Tuesday, Lake County, Ill., is offering $90 million of Series 2015A GOs backed by a sales tax alternative revenue source. The bonds are initially structured to mature serially from 2015 through 2025.
The county last sold comparable bonds competitively on Nov. 6, 2013, when Hutchinson Shockey won $30 million of Series 2013 GOs backed by a sales tax alternative revenue source.
On Thursday, the South Carolina Transportation Infrastructure Bank will offer the biggest competitive bond sale of the week when its $155.15 million of Series 2015A revenue refunding deal goes out for bids. The bonds are initially structured to mature serially from 2017 through 2027.
The S.C. Infrastructure Bank last sold comparable bonds competitively on Oct. 10, 2012, when Bank of America Merrill Lynch won $429.91 million of Series 2012B revenue refunding bonds with a true interest cost of 2.95%.
In the short-term competitive sector, the N.Y. Metropolitan Transportation Authority is selling $500 million of Series 2015A transportation revenue bond anticipation notes on Thursday. The BANs are dated June 25 and due March 1, 2016. The notes are rated MIG1 by Moody's, SP1-plus by S&P and F1 by Fitch.
Houston, Texas, is selling $220 million of Series 2015 tax and revenue anticipation notes on Wednesday. The TRANs are rated SP1-plus by S&P and are dated July 2 and due on June 30, 2016.
Prior Week's Actively Traded Issues by Sector
Some of the most actively traded issues in the week ended June 12 were in New York, Massachusetts and Puerto Rico names, according to Markit.
Revenue bonds comprised 56.14% of new issuance, up from 54.87% in the previous week. General obligation bonds comprised 36.13% of total issuance, down from 37.36%, while taxable bonds made up 7.73%, down from 7.77%.
In the revenue bond sector, the DASNY non-state supported debt 4s of 2035 were traded 101 times. In the GO bond sector, the Massachusetts 4s of 2045 were traded 62 times. And in the taxable bond sector, the Puerto Rico Employees Retirement System 6.15s of 2038 were traded 20 times, according to Markit.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 33,583 trades on Friday on volume of $8.824 billion.
The most active bond, based on the number of trades, was the Miami-Dade County, Fla.'s Series 2015A aviation revenue refunding AMT 4 1/2s of 2045, which traded 217 times at an average price of 100.724 with an average yield of 4.396%. The bonds were initially priced at 98.369 to yield 4.60%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $21.9 million to $11.03 billion on Monday. The total is comprised of $3.08 billion competitive sales and $7.95 billion of negotiated deals.
