The municipal bond market on Thursday is eyeing yields as the last of the week’s larger deals are slated to sell, with two big competitive offerings on tap.
U.S. Treasuries were stronger on Thursday. The yield on the two-year Treasury declined to 1.59% from 1.62% on Wednesday, the 10-year Treasury yield dipped to 2.43% from 2.44% and yield on the 30-year Treasury bond decreased to 2.94% from 2.95%.
Municipal bonds finished weaker on Wednesday. The yield on the 10-year benchmark muni general obligation rose four basis points to 2.00% from 1.96% on Tuesday, while the 30-year GO yield increased five basis points to 2.82% from 2.77%, according to the final read of Municipal Market Data`s triple-A scale.
On Wednesday, the 10-year muni-to-Treasury ratio was calculated at 82.1% compared with 81.6% on Tuesday, while the 30-year muni-to-Treasury ratio stood at 95.6% versus 94.9%, according to MMD.
AP-MBIS 10-year muni at 2.313%, 30-year at 2.890%
The Associated Press-MBIS municipal non-callable 5% GO benchmark scale exhibited weakness on Thursday.
In early trade, the 10-year muni benchmark yield increased to 2.313% from the final read of 2.305% on Wednesday, according to Municipal Bond Information Services, a national consortium of municipal interdealer brokers. The AP-MBIS 30-year benchmark muni yield increased to 2.890% from 2.888% on Tuesday.
The AP-MBIS benchmark index is a yield curve built on market data aggregated from MBIS member firms and is updated hourly on the Bond Buyer Data Workstation.
MSRB: Previous session`s activity
The Municipal Securities Rulemaking Board reported 39,548 trades on Wednesday on volume of $10.67 billion.
In the competitive arena, the Washington Suburban Sanitary District, Md., is selling $712.53 million of consolidated public improvement bonds in two separate sales.
The offerings consist of $493.77 million of consolidated public improvement bonds of 2017 and $218.76 million of consolidated public improvement refunding bonds of 2017.
The deals are rated triple-A by Moody’s Investors Service, S&P Global Ratings and Fitch Ratings.
Since 2007, the district has sold over $4 billion of debt with the most issuance prior to Thursday’s sale being in 2015 when it sold $625.3 million. The district didn’t come to market at all in 2008.
Also on Thursday, the Santa Clara Unified School District, Calif., is competitively selling $392.76 million of general obligation bonds in two separate sales.
The offerings consist of $232.3 million of Election of 2014 GOs and $160.46 million of Election of 2014 refunding GOs.
The deals are rated Aaa by Moody’s and AA by S&P.
Bond Buyer reports 30-day visible supply
The Bond Buyer`s 30-day visible supply calendar decreased $4.34 billion to $9.0 billion on Thursday. The total is comprised of $5.54 billion of competitive sales and $3.46 billion of negotiated deals.
Tax-exempt money market funds see inflows
Tax-exempt money market funds experienced inflows of $179.1 million, raising total net assets to $128.33 billion in the week ended Oct. 23, according to The Money Fund Report, a service of iMoneyNet.com.
This followed an outflow of $450.3 million to $128.16 billion in the previous week.
The average, seven-day simple yield for the 207 weekly reporting tax-exempt funds rose to 0.46% from 0.44% the previous week.
The total net assets of the 832 weekly reporting taxable money funds increased $3.18 billion to $2.589 trillion in the week ended Oct. 24, after an inflow of $12.79 billion to $2.586 trillion the week before.
The average, seven-day simple yield for the taxable money funds was steady at 0.69% from the prior week.
Overall, the combined total net assets of the 1,048 weekly reporting money funds increased $3.36 billion to $2.718 trillion in the week ended Oct. 24, after inflows of $12.34 million to $2.714 trillion in the prior week.
Data appearing in this article from Municipal Bond Information Services, including the AP-MBIS municipal bond index, is available on the Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Vanessa Kim at 212-803-8474 for more information.