Top-rated municipal bonds were mixed at mid-session, according to traders, who were seeing the first of the week’s new issues hit the screens.

Secondary market
The yield on the 10-year benchmark muni general obligation rose as much as one basis point from 2.00% on Friday, while the 30-year GO yield was steady from 2.84%, according a read of Municipal Market Data's triple-A scale.

U.S. Treasuries were also mixed on Monday. The yield on the two-year Treasury rose to 1.50% from 1.48%, the 10-year Treasury yield gained to 2.33% from 2.32% and the yield on the 30-year Treasury bond was unchanged from 2.86%.

On Friday, the 10-year muni-to-Treasury ratio was calculated at 86.2% compared with 86.7% on Thursday, while the 30-year muni-to-Treasury ratio stood at 99.5% versus 99.3%, according to MMD.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 33,376 trades on Friday on volume of $9.56 billion.

Prior week's actively traded issues
Revenue bonds comprised 56.13% of new issuance in the week ended Sept. 29, up from 56.08% in the previous week, according to Markit. General obligation bonds made up 37.64% of total issuance, up from 37.56%, while taxable bonds accounted for 6.23%, down from 6.36%.

Some of the most actively traded bonds by type in the week ended Sept. 29 were from Oregon, Colorado and Illinois issuers. In the GO bond sector, the Oregon 5s of 2018 were traded 41 times. In the revenue bond sector, the city and county of Denver, Colo., 5s of 2032 were traded 76 times. And in the taxable bond sector, the Illinois 5.1s of 033 were traded 23 times.

Previous week's top underwriters

The top municipal bond underwriters of last week included Bank of America Merrill Lynch, Citigroup, Morgan Stanley, Wells Fargo Securities and Piper Jaffray, according to Thomson Reuters data.

In the week of Sept. 24 to Sept. 30, BAML underwrote $2.11 billion, Citi $1.81 billion, Morgan Stanley $1.40 billion, Wells Fargo $837 million, and Piper Jaffray $790 million.

Primary market
Volume for the week is estimated at $4.97 billion, composed of $2.29 billion of negotiated deals and $2.68 billion of competitive sales.

Action kicked off in the short-term competitive arena on Monday as the New York’s Triborough Bridge and Tunnel Authority sold $400 million of Series 2017A general revenue bond anticipation.

The issue was won by six groups including Citigroup, Morgan Stanley, Goldman Sachs, JPMorgan Securities, Barclays Capital and RBC Capital Markets:

  • Citi won $150 million, taking $100 million with a bid of 2% and a $384,000 premium, an effective rate of 0.925430% and taking $50 million with a bid of 2% and a $193,000 premium, an effective rate of 0.919840%.
  • Morgan Stanley won $150 million taking $100 million with a bid of 2% and a $385,000 premium, an effective rate of 0.922630% and taking $50 million with a bid of 2% and a $193,500 premium, an effective rate of 0.917050%.
  • Goldman Sachs won $25 million with a bid of 2% and a $96,750 premium, an effective rate of 0.917050%.
  • JPMorgan won $25 million with a bid of 2% and a $96,500 premium, an effective rate of 0.919840%.
  • Barclays won $25 million with a bid of 2% and a $96,250 premium, an effective rate of 0.922630%.
  • RBC won $25 million with a bid of 2% and a $96,250 premium, an effective rate of 0.922630%.

The TBTA’s BANs are rated MIG1 by Moody’s Investors Service and F1-plus by Fitch Ratings.

Also on Monday, King County, Wash., competitively sold $148.01 million of Series 2017 limited tax general obligation refunding bonds which are payable from sewer revenues.

Bank of America Merrill Lynch won the bonds with a true interest cost of 2.55%.

The issue was priced to yield from 1% with a 5% coupon in 2018 to 2.80% with a 4% coupon in 2033.

The deal is rated triple-A by Moody’s and S&P Global Ratings.

But the main event begins when the Dormitory of the State of New York sells $1.7 billion of bonds in five competitive offerings on Tuesday.

DASNY will competitively sell general purpose state personal income tax revenue bonds consisting of $530.94 million of Series 2017B bidding group 2 bonds, $530.065 million of Series 2017B bidding group 3 bonds, $529.595 million of Series 2017B bidding group 1 bonds, $86.8 million of Series 2017D taxable bonds and $21.845 million of Series 2017C tax-exempt bonds.

The bonds are rated Aa1 by Moody’s and AAA by S&P.

And on Thursday, RBC Capital Markets will price DASNY’s $301.48 million of school districts and financing program revenue bonds in five series.

The Series 2017 F, G, H, I and J carry various ratings ranging from Aa2 and Aa3 from Moody’s to A-plus from S&P and AA-minus from Fitch.

In the negotiated sector on Tuesday, Goldman Sachs is expected to price the San Diego Unified School District’s $220 million of Series 2017 general obligation bonds.

The deal is rated Aa3 by Moody’s and AAA by Fitch.

Bank of America Merrill Lynch is expected to price the Maine Municipal Bond Bank’s $184 million of Series 2017 C and Series 2017 D refunding bonds on Tuesday.

The deal is rated Aa2 by Moody’s and AA-plus by S&P.

In the competitive arena on Tuesday, Columbus, Ohio, will offer $314.13 million of various purpose bonds in three separate sales consisting of $285.82 million of Series 2017A unlimited tax bonds, $19.51 million of Series 2017C taxable limited tax bonds and $8.795 million of Series 2017B limited tax bonds.

The deals rare rated triple-A by Moody’s, S&P and Fitch.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar increased $373.2 million to $9.22 billion on Monday. The total is comprised of $3.83 billion of competitive sales and $5.39 billion of negotiated deals.

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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.