Traders said prices of top-quality municipal bonds were stronger at mid-session, with yields on some maturities falling by as much as two basis points ahead of this week's heavy new issue supply.
The yield on the 10-year benchmark muni general obligation was as much as one basis point weaker from 2.17% on Friday, while the 30-year yield was as much as two basis points off from 3.15%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were higher on Monday as the two-year Treasury yield slipped to 0.83% from 0.85% on Friday, while the 10-year Treasury yield declined to 2.25% from 2.27% and the 30-year yield decreased to 3.05% from 3.06%.
On Friday, the 10-year muni to Treasury ratio was calculated at 95.3% from 94.7% on Thursday, while the 30-year muni to Treasury ratio stood at 103.1% compared to 103.3%, according to MMD.
Primary Market
Volume for the week is estimated at $9.42 billion, consisting of $7.02 billion of negotiated deals and $2.40 billion of competitive sales. Volume is heavy ahead of the Thanksgiving holiday next week.
On Monday, Bank of America Merrill Lynch priced the Massachusetts School Building Authority's $730.78 million of Series 2015C senior dedicated sales tax refunding bonds for retail investors ahead of the institutional pricing on Tuesday.
The deal was priced for retail to yield from 0.92% with a 2% coupon in 2018 to 3.75% at par and 3.21% with a 5% coupon in two parts of a triple split 2037 maturity; a 2016 maturity was offered as a sealed bid. No retail orders were taken in the 2027-2028 or 2030-2036 maturities or in the $88.5 million section of the 2037 triple-split maturity.
The deal is rated Aa2 by Moody's Investors Service and AA-plus by Standard & Poor's and Fitch Ratings. It carries a stable outlook from all three rating agencies.
Ramirez & Co. priced the New York City Municipal Water Finance Authority's $338.08 million of Fiscal 2016 Series BB water and sewer system second general resolution revenue bonds for retail investors ahead of the institutional pricing on Tuesday.
The $316.31 million of Subseries BB-1 bonds were priced as 5s to yield 3.50% in 2046 and as 4s to yield 4.85% in 2046. The $21.77 million of Subseries BB-2 bonds were priced as 5s to yield 1.25% in 2021.
The issue is rated Aa1 by Moody's and AA-plus by S&P and Fitch.
Barclays Capital Markets is scheduled to price the state of Connecticut's $650 million of Series F and G general obligation bonds on Tuesday. The issue consists of $585 million of Series F bonds and $65 million of Series G green bonds.
The deal is rated Aa3 by Moody's and AA by S&P, Fitch and Kroll Bond Rating Agency.
The green bond portion of the sale will fund wastewater infrastructure projects across the state and is only Connecticut's third green bond offering. The state sold $60 million of green bonds as part of a larger sale in November 2014 and had a $250 million green bond only sale in April.
RBC Capital Markets is expected to price the New Jersey Transportation Trust Fund Authority's $626.8 million of Series 2015 AA transportation program bonds on Tuesday. The deal is rated A3 by Moody's and A-minus by both S&P and Fitch.
In the competitive arena on Tuesday, Wisconsin will sell $225 million of Series 2016A transportation revenue bonds. The deal is rated AA-plus by Fitch.
The Maryland Water Quality Finance Administration will offer $180 million of Series 2015 Bay Restoration Fund revenue bonds. The issue is rated Aa2 by Moody's and AA by S&P.
And the Omaha Metropolitan Utilities District, Neb., will sell $179.4 million of Series 2015 water system improvement and refunding revenue bonds. The deal is rated A1 by Moody's and A-plus by S&P.
The Previous Week's Actively Traded Sectors
Revenue bonds comprised 55.54% of new issuance in the week ended Nov. 13, up from 55.25% in the previous week, according to Markit. General obligation bonds comprised 37.11% of total issuance, up from 37.05%, while taxable bonds made up 7.35%, down from 7.70%.
Some of the most actively traded issues in the week were in Texas and California.
In the revenue bond sector, the Central Texas Regional Mobility Authority 5s of 2045 were traded 54 times. In the GO sector, the California 5s of 2045 were traded 26 times. And in the taxable bond sector, the California 7.55s of 2039 were traded 16 times, Markit said.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 32,634 trades on Friday on volume of $6.95 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $441 million to $11.9 billion on Monday. The total is comprised of $3.5 billion competitive sales and $8.4 billion of negotiated deals.
