A bevy of new municipal bond deals are set to come to market on Tuesday after traders saw two sessions where yields moved lower.
Primary Market
Bank of America Merrill Lynch is set to price the Massachusetts School Building Authority's $730.78 million of Series 2015C senior dedicated sales tax refunding bonds for institutional investors after a retail pricing on Monday.
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. will price 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 institutions after holding a retail order period on Monday.
The $316.31 million of Subseries BB-1 bonds were priced for retail 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.
JP Morgan priced the Long Island Power Authority's $117.23 million of Series 2015B electric system general revenue bonds for retail investors ahead of the institutional offering.
The bonds were priced for retail to yield from 1.36% with a 4% coupon in 2019 to 3.56% with a 5% coupon in 2035; a 2040 maturity was priced as 4s to yield 4.064%. No retail orders were taken for the 2026-2030, 2031-2034, 2039 or 2045 maturities. The deal is rated Baa1 by Moody's and A-minus 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 bonds will fund wastewater infrastructure projects across the state and is only the Nutmeg State's third green bond offering. Connecticut sold $60 million of green bonds as part of a larger sale last November 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 S&P and Fitch.
Since 2005, the NJTTFA has issued roughly $17.46 billion of debt. The authority sold its largest amount of bonds in 2005 and 2006, when it issued $2.6 billion and $2.8 billion, respectively. The NJTTFA sold its lowest amount of bonds in 2009 and 2014, when it came to market with $713 million and $1.1 billion, respectively. On average over the past 10 years, the NJTTFA has come to market roughly 2.3 times a year.
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 Tuesday. The deal is rated A1 by Moody's and A-plus by S&P.
Secondary Market
Treasury prices were lower on Tuesday. The two-year Treasury yield rose to 0.88% from 0.84% on Monday while the 10-year Treasury yield gained to 2.30% from 2.27% and the 30-year yield increased to 3.08% from 3.07%.
Top-quality municipal bonds finished stronger on Monday. The yield on the 10-year benchmark muni general obligation ended one basis point weaker at 2.16% from 2.17% on Friday, while the 30-year yield was off one basis point to 3.14% from 3.15%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Monday at 94.9% from 95.3% on Friday, while the 30-year muni to Treasury ratio stood at 102.1% compared to 103.1%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 36,824 trades on Monday on volume of $5.07 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $1.04 billion to $12.94 billion on Tuesday. The total is comprised of $4.50 billion competitive sales and $8.44 billion of negotiated deals.
