Municipal bonds were trading stronger at midday as the Hudson Yards deal hit the municipal bond market on Tuesday along with a host of other sales.

Secondary market
The yield on the 10-year benchmark muni general obligation dropped one to three basis points from 1.99% on Monday, while the 30-year GO yield declined one to three basis points from 2.85%, according to a read of Municipal Market Data's triple-A scale.

Since the start of the year, the 10-year muni yield has fallen about 33 basis points as the 30-year yield has dropped about 20 basis points. On Jan. 2, the 10-year muni stood at 2.32% while the 30-year was at 3.05%.

U.S. Treasuries were weaker on Tuesday. The yield on the two-year Treasury rose to 1.30% from 1.27% on Monday as the 10-year Treasury yield gained to 2.27% from 2.25% while the yield on the 30-year Treasury bond increased to 2.92% from 2.91%.

On Monday, the 10-year muni to Treasury ratio was calculated at 88.3%, compared with 89.6% on Friday, while the 30-year muni to Treasury ratio stood at 97.8%, versus 98.8%, according to MMD.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 37,656 trades on Monday on volume of $7.44 billion.

Primary market
Goldman Sachs priced the Hudson Yards Infrastructure Corp., N.Y.’s $2.12 billion of tax-exempt Fiscal 2017 Series A second indenture revenue bonds for institutions on Tuesday after holding a two-day retail order period.

The HYIC bonds were priced for institutions to yield from 1.30% with 3% and 5% coupons in a split 2022 maturity to 3.12% with a 5% coupon in 2039. A 2042 maturity was priced as 5s to yield 3.16%, a 2044 maturity was priced as 4s to yield 3.49%, a 2045 maturity was priced as 5s to yield 3.20% and a 3047 maturity was priced as 4s to yield approximately 3.415%.

On Monday, the HYIC bonds were priced for retail to yield from 1.31% with 3% and 5% coupons in a split 2022 maturity to approximately 3.568% with a 3.50% coupon in 2038; a 2042 maturity was priced as 5s to yield 3.19% while a 2045 maturity was priced as 4s to yield 3.53%. No retail orders were taken in the 2031, 2033-2035, 2039, 2041, 2044 or 2047 maturities.

The HYIC also competitively sold $33.36 million of taxable Fiscal 2017 Series B bonds.

Wells Fargo Securities won the issue with a true interest cost of 2.47%. The taxables were priced at par to yield 3.875% in 2038.

The deals are rated Aa3 by Moody's Investors Service and A-plus by both S&P Global Ratings and Fitch Ratings. All three rating agencies assign stable outlooks to the credit.

Bank of America Merrill Lynch priced the California Municipal Finance Authority’s $234.09 million of Series 2017A revenue refunding bonds for the Eisenhower Medical Center.

The issue was priced to yield from 2.17% with a 5% coupon in 2024 to 3.65% with a 5% coupon in 2037. A split 2042 maturity was priced as 4s to yield 4.04% and as 5s to yield 3.74% while a split 2047 maturity was priced as 4s to yield 4.10% and as 5s to yield 3.80%.

The deal is rated Baa2 by Moody’s and BBB by Fitch.

Since 2007, the California MFA has sold about $5.46 billion of securities with the most issuance before this year occurring in 2015 when it sold $840 million. The MFA had come to market every year over the past 10 years, with the lowest issuance taking place back in 2012 when it sold $140 million.

Wells Fargo Securities priced Clark County, Nev.’s $150 million of Series 2017 indexed fuel tax and subordinate motor vehicle fuel tax highway revenue bonds.

The bonds were priced to yield from 0.93% with a 4% coupon in 2018 to 3.03% with a 5% coupon in 2037.

The deal is rated Aa3 by Moody’s and AA-minus by S&P.

Citigroup priced the Northside Independent School District, Texas’s $100 million of Series 2017 variable-rate unlimited tax school building bonds.

The issue was priced at par to yield 1.50% in 2047 with a mandatory date in 2020.

The deal, which is backed by the Permanent School Fund guarantee program, is rated triple-A by Moody’s and Fitch.

Wells Fargo Securities price the Virginia Housing Development Authority’s $150.08 million of Series 2017A taxable pass-through commonwealth mortgage bonds.

The issue was priced at par to yield 3.125% in 2039.

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

Fort Worth, Texas, competitively sold $111.67 million of Series 2017 water and sewer system revenue refunding and improvement bonds.

BAML won the bonds with a TIC of 3.34%. The issue was priced to yield from 0.87% with a 5% coupon in 2018 to 3.34% with a 4% coupon in 2042; a 2047 maturity was priced as 4s to yield 3.45%.

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

Bond Buyer 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $99.0 million to $12.73 billion on Friday. The total is comprised of $4.51 billion of competitive sales and $8.22 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.
Aaron Weitzman

Aaron Weitzman

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