Munis weaker still before last issuance of week
The last issuance of the week is expected to drift in on Thursday, on the heels of yields jumping due to details of tax reform being released.
Top-shelf municipal bonds were slightly weaker still on Thursday morning. The yield on the 10-year benchmark muni general obligation was as many as two basis points higher from 1.98% from on Wednesday, while the 30-year GO yield also increased as many as two basis points from 2.84%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were mostly weaker on Thursday morning. The yield on the two-year Treasury was flat at 1.47%, the 10-year Treasury yield increased to 2.33% from 2.31% and the yield on the 30-year Treasury bond rose to 2.88% from 2.86%.
On Wednesday, the 10-year muni-to-Treasury ratio was calculated at 85.9% compared with 86.1% on Tuesday, while the 30-year muni-to-Treasury ratio stood at 99.3% versus 100.3%, according to MMD.
MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 42,958 trades on Wednesday on volume of $14.567 billion.
Tax-exempt money market funds see outflows
Tax-exempt money market funds experienced outflows of $327.1 million, lowering total net assets to $127.90 billion in the week ended Sept. 25, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $128.23 million to $128.23 billion in the previous week.
The average, seven-day simple yield for the 224 weekly reporting tax-exempt funds moved up to 0.40% from 0.37% the previous week.
The total net assets of the 830 weekly reporting taxable money funds increased $30.27 billion to $2.587 trillion in the week ended Sept. 26, after an outflow of $25.08 billion to $2.557 trillion the week before.
The average, seven-day simple yield for the taxable money funds held steady at 0.68% from the prior week.
Overall, the combined total net assets of the 1,054 weekly reporting money funds increased $29.94 billion to $2.715 trillion in the week ended Sept. 26, after outflows of $24.85 million to $2.685 trillion in the prior week.
Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $4.163 billion to $9.43 billion on Thursday. The total is comprised of $3.93 billion of competitive sales and $5.50 billion of negotiated deals.
Morgan Stanley is slated to price the Industrial Development Authority of the County of Maricopa, Ariz.’s $351.985 million of revenue bonds for Banner Health. The deal is rated AA-minus by S&P Global Ratings and Fitch Ratings.
Bank of America Merrill Lynch is expected to price South Dakota Health and Educational Facilities Authority’s $216 million of revenue refunding bonds. The deal is rated A1 by Moody’s Investors Service and AA-minus by S&P.
On the competitive side, the California State Public Works Board is scheduled to sell $202.325 million of various lease revenue bonds. The deal is rated A1 by Moody’s and A-plus by S&P and Fitch Ratings.
Since 2007, the California PWB has sold about $13.57 billion of securities, with the most issuance in 2009 when it sold $2.19 billion. The board saw the lowest year of issuance in 2008 when it sold $365 million. With Thursday’s sale, the board sold more this year than last year.