Municipal bonds were weaker at the market close on Monday, according to traders, with yields on top-quality munis rising three basis points on some maturities.
There were no larger deals in the market Monday, as participants awaited the week's first volley of new issuance Tuesday, headlined by a $1.75 billion deal by a Florida issuer.
Secondary Market
The yield on the 10-year benchmark muni general obligation was three basis points higher to 2.19% from 2.16% on Friday, while the 30-year GO was also up three basis points to 3.20% from 3.17% on Friday, according to a final read of Municipal Market Data's triple-A scale.
Treasuries were mostly weaker at market close on Monday, as the 10-year Treasury yield rose to 2.35% from 2.33% on Friday and the 30-year yield increased to 3.11% from 3.09%. The yield on the two-year Treasury fell to 0.88% from 0.89% on Friday.
The 10-year muni to Treasury ratio was calculated on Monday at 93.2% versus 92.7% on Friday, while the 30-year muni to Treasury ratio stood at 102.8% compared to 102.6%, according to MMD.
Primary Market
The first of wave of supply for the week hits screens on Tuesday, as six larger noteworthy deals are expected to price.
The largest deal on the calendar is the Florida Development Finance Corporation's $1.75 billion of revenue bonds for the All Aboard Florida passenger rail project. The deal is expected to be priced by Bank of America Merrill Lynch. The deal is not rated and is being sold to qualified institutional buyers and accredited investors.
JPMorgan is expected to price the Central Texas Regional Mobility's $375 million of senior lien revenue and refunding put bonds on Tuesday. The deal is expected to mature serially from 2025-2045 and is rated Baa2 by Moody's and BBB-plus by S&P.
BAML is also scheduled to price the school board of Miami-Dade Counties' $229 million of certificates of participation on Tuesday. The COPs are rated A1 by Moody's and A-minus by S&P.
JPMorgan is also slated to price Kershaw County, S.C., public schools foundation installment purchase's $101.91 million of refunding revenue bonds. The bonds are rated A1 by Moody's and A-minus by S&P.
In the competitive arena on Tuesday, the Washington, Md., suburban sanitation department will be selling $150.67 million of consolidated public improvement refunding bonds. The deal is rated Aaa by Moody's and triple-A by both S&P and Fitch Ratings.
Washtubs is a frequent market participant, and most recently sold $390 million last month, when Bank of America Merrill Lynch won the bonds with a true interest cost of 3.43%.
The New Jersey Environmental Infrastructure Trust will be selling three separate issues totaling $140.69 million on Tuesday. The largest of the three issues will be $117.475 million of refunding bonds, Series 2015B-R2, which will be subject to alternative minimum tax.
The Previous Week's Actively Traded Sectors
Revenue bonds comprised 55.25% of new issuance in the week ended Oct. 30, down from 55.38% in the previous week, according to Markit. General obligation bonds comprised 37.05% of total issuance, up from 36.47%, while taxable bonds made up 7.70%, down from 8.15%.
Some of the most actively traded issues in the week were in California and Texas.
In the revenue bond sector, The Bexar County, Texas 4s of 2051 were traded 90 times. In the GO sector, the California 5s of 2045 were traded 29 times. And in the taxable bond sector, the Los Angeles municipal improvement corporation 3.432s of 2021 were traded 27 times, Markit said.
