Municipal bonds were unchanged at mid-session as the big New York City Transitional Finance Authority deal was priced for retail investors.

Secondary market
The yield on the 10-year benchmark muni general obligation was unchanged from 1.96% on Friday, while the 30-year GO yield was flat from 2.74%, according to a read of Municipal Market Data's triple-A scale.

U.S. Treasuries were weaker on Monday. The yield on the two-year Treasury rose to 1.52% from 1.50% on Friday, the 10-year Treasury yield gained to 2.30% from 2.28% and yield on the 30-year Treasury bond increased to 2.82% from 2.81%.

On Friday, the 10-year muni-to-Treasury ratio was calculated at 86.0% compared with 85.3% on Thursday, while the 30-year muni-to-Treasury ratio stood at 97.2% versus 97.5%, according to MMD.

AP-MBIS 10-year muni dips to 2.29%
The Associated Press-MBIS 10-year municipal benchmark 5% general obligation was at 2.29% at midday, unchanged from the final read of 2.29% on Friday, according to Municipal Bond Information Services, a national consortium of municipal interdealer brokers.

The AP-MBIS index is a yield curve built on market data aggregated from MBIS member firms and will be updated hourly on the Bond Buyer Data Workstation.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 32,753 trades on Friday on volume of $12.55 billion.

Prior week's actively traded issues
Revenue bonds comprised 56.97% of new issuance in the week ended Oct. 13, up from 56.57% in the previous week, according to Markit. General obligation bonds made up 37.02% of total issuance, down from 37.36%, while taxable bonds accounted for 6.01%, down from 6.07%.

Some of the most actively traded bonds by type were from Puerto Rico, California and Illinois issuers.

In the GO bond sector, the Puerto Rico Commonwealth 8s of 2035 were traded 28 times. In the revenue bond sector, the San Francisco Airports Commission 5s of 2047 were traded 73 times. And in the taxable bond sector, the Illinois 5.1s of 2033 were traded 17 times.

Primary market
This week’s $9.9 billion new issue slate consists of $4.3 billion of negotiated deals and $5.6 billion of competitive sales.

Five issuers — the NYC TFA, the N.Y. Metropolitan Transportation Authority and the states of California, Illinois and Massachusetts — account for over half of this week’s new volume.

On Monday, Goldman Sachs priced the NYC TFA’s $850 million of Fiscal 2018 Series B Subseries B-1 future tax secured subordinate bonds for retail investors.

The issue was priced to yield from 1.01% with 3% and 5% coupons in a split 2019 maturity to approximately 3.40% in 2045. No retail orders were taken in the 2031-2033, 2036, 2038-2041, or 2043 maturities.

The deal has a two-day retail order period before being priced for institutions on Wednesday when the TFA will also competitively sell $140 million of taxable Fiscal 2018 Series B Subseries B-2 future tax secured subordinate bonds.

The deals are rated Aa1 by Moody’s Investors Service and AAA by S&P Global Ratings and Fitch Ratings.

Action continues to rev up on Tuesday, as two big states on the opposite ends of the credit spectrum sell bonds in the competitive arena.

California is coming to market with $1.59 billion of various purpose general obligation bonds in three separate sales.

The offerings consist of $557.22 million of tax-exempt Bid Group B $64 million GOs and $493.22 million refunding GOs; $522.53 million of tax-exempt Bid Group C $134.66 million GOs and $387.88 million refunding GOs; and $508.57 million of Bid Group A taxable GOs.

The deals are rated Aa3 by Moody’s Investors Service, and AA-minus by S&P Global Ratings and Fitch Ratings.

Illinois is selling $1.5 billion of GOs in three separate sales.

The offerings consist of $500 million Series of November 2017A GOs, $500 million of Series of November 2017B GOs and $500 million of Series of November 2017C GOs.

The deals are rated Baa3 by Moody’s, BBB-minus by S&P and BBB by Fitch.

And Nevada is competitively selling $114.96 million of limited tax GOs in six separate sales.

The offerings consist of $84.36 million Series 2017A capital improvement GOs, $8.24 million of Series 2017C open space, parks, natural resources and refunding GOS, $6.29 million of Series 2017E safe drinking water revolving fund matching GOs, $6.21 million of Series 2017B natural resources and refunding GOs, $6 million of Series 2017D Nevada Municipal Bond Bank Project No. 9 GOs, and $3.87 million of Series 2017F water pollution control revolving fund matching GOs.

The deals are rated Aa2 by Moody’s, AAA by S&P and AA-plus by Fitch.

Also on Tuesday, the Virginia Public School Authority is competitively selling $116.01 million of 1997 Resolution Series 2017C school financing bonds.

The deal is rated Aa1 by Moody’s and AA-plus by S&P and Fitch.

On Tuesday, Citigroup is slated to price the Berks County Industrial Development Authority, Pa.’s $575 million of health system revenue bonds for Tower Health.

The deal is rated A3 by Moody’s and A by S&P and Fitch.

Also this week, Massachusetts is selling $818.125 million of bonds in three competitive offerings on Wednesday while the New York Metropolitan Transportation Authority is selling $1 billion of notes in two deals on Thursday.

And West Virginia’s $120 million and Ohio’s $100 million negotiated offerings are set to hit the market, bringing to six the number of states selling deals over $100 million this week.

Previous week's top underwriters
The top municipal bond underwriters of last week included Bank of America Merrill Lynch, Morgan Stanley, Wells Fargo Securities, Jefferies, and Barclays Capital, according to Thomson Reuters data.

In the week of Oct. 8 to Oct. 14, BAML underwrote $2.84 billion, Morgan Stanley $752.1 million, Wells Fargo $628.5 million, Jefferies $461.3 million, and Barclays $402.4 million.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar increased $1.27 billion to $16.72 billion on Monday. The total is comprised of $7.13 billion of competitive sales and $9.59 billion of negotiated deals.

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 212-803-8372 for more information.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.
Chip Barnett

Chip Barnett

Chip Barnett is a journalist with more than 40 years of experience. Barnett is currently Senior Market Reporter for The Bond Buyer.
Aaron Weitzman

Aaron Weitzman

Aaron Weitzman is a markets reporter for The Bond Buyer, focusing on the sell side of the municipal bond market.