The municipal market was firmer by about three basis points overall in fairly light trading activity, as a positive tone in tax-exempts persisted.“It’s kind of an interesting marketplace. You see Treasuries are off, but munis are up probably two to four basis points,” a trader in Los Angeles said. “The market is pretty firm, but there’s still not a lot of bonds around to choose from. The people that have been seeking bids for their bonds have done remarkably well, especially in the high grade sector. The not-so-high grades, it’s depending on size. If it’s a good-sized block, they’ll probably get a good bid. If it’s just a medium-sized block, less than a million, you may get a bid, but it may not be good.”

The Treasury market showed losses yesterday. The yield on the benchmark 10-year note, which opened at 3.31%, was quoted near the end of the session at 3.40%. The yield on the two-year note was quoted near the end of the session at 0.93% after opening at 0.91%. The yield on the 30-year bond, which opened at 4.19%, was quoted near the end of the session at 4.29%.

As of Wednesday’s close, the triple-A muni scale in 10 years was at 93.1% of comparable Treasuries, according to Municipal Market Data. Additionally, 30-year munis were 109.3% of comparable Treasuries. As of the close Wednesday, 30-year tax-exempt triple-A general obligation bonds were at 117.4% of the comparable London Interbank Offered Rate.

In the new-issue market yesterday, Morgan Stanley priced $200 million of revenue bonds for the Illinois Finance Authority in two series. Bonds from the $173.8 million Series C mature in 2029 and 2039, yielding 6.50% with a 6.375% coupon and 6.75% with a 6.625% coupon, respectively. Bonds from the $26.2 million Series D mature from 2025 through 2027, with term bonds in 2029 and 2039. Yields range from 6.20% priced at par in 2025 to 6.75% with a 6.625% coupon in 2039. The bonds, which are callable at par in 2019, are rated A3 by Moody’s Investors Service and A-minus by Standard & Poor’s and Fitch Ratings.

Kern County, Calif., competitively sold $180 million of tax and revenue anticipation notes to Goldman, Sachs & Co. with a true interest cost of 0.52%. The Trans mature in 2010, with a 2.5% coupon, and were not formally re-offered. The credit is rated SP-1-plus by Standard & Poor’s.

The South Carolina Association of Governmental Organizations competitively sold $146.6 million of certificates of participation to Citi with a net interest cost of 0.44%, which mature in 2010 with a 1.5% coupon, and were not formally re-offered. The credit is rated MIG-1 by Moody’s.

Anne Arundel County, Md., competitively sold $53.3 million of bonds to Morgan Keegan & Co., in two series. Bonds from the $31.7 million series of consolidated general improvement bonds, which were sold at a TIC of 2.61%, mature from 2010 through 2025, and were not formally re-offered. Bonds from the $20.1 million series of consolidated water and sewer bonds, which were sold at a TIC of 3.04%, mature from 2011 through 2025, and were not formally re-offered. The bonds, which are callable at par in 2019, are rated Aa1 by Moody’s, AAA by Standard & Poor’s, and AA-plus by Fitch.

College Station, Tex., competitively sold $31.3 million of certificates of obligation to Robert W. Baird & Co., with a TIC of 4.14%. The bonds mature from 2010 through 2029, with yields ranging from 1.00% with a 3% coupon in 2011 to 4.67% with a 4.6% coupon in 2029. Bonds maturing in 2010 were decided via sealed bid. The bonds, which are callable at par in 2019, are rated Aa3 by Moody’s and AA by Standard & Poor’s.

JPMorgan priced $22.8 million of revenue bonds for the Dormitory Authority of the State of New York. The bonds mature in 2033, yielding 5.80% with a 5.75% coupon. The bonds, which are callable at par in 2019, are rated Baa1 by Moody’s and BBB-plus by Standard & Poor’s.

Falmouth, Mass, competitively sold $19.8 million of GO bond anticipation notes to TD Securities with a NIC of 0.49%. The Bans mature in 2010, with a 1.5% coupon, and were not formally re-offered. The credit is rated SP-1-plus by Standard & Poor’s.

Also, final pricing information was released on Wednesday’s $200 million California Infrastructure and Economic Development Bank revenue bond deal, which was priced by RBC Capital Markets. The bonds mature from 2012 through 2024, with term bonds in 2030 and 2039. Yields range from 2.43% with a 3% coupon in 2012 to 5.88% with a 6.25% coupon in 2039. The bonds, which are callable at par in 2015, are rated A2 by Moody’s, A by Standard & Poor’s, and AA-minus by Fitch.

In economic data released yesterday, initial jobless claims for the week ended July 4 came in at 565,000, after a revised 617,000 the previous week. Economists polled by Thomson Reuters had predicted 605,000 initial jobless claims. Continuing jobless claims for the week ended June 27 came in at 6.883 million, after a revised 6.724 million the previous week.

Wholesale sales climbed 0.2% in May, after a revised no change the previous month. Economists polled by Thomson Reuters had predicted no change. Wholesale inventories dropped 0.8% in May, after a revised 1.3% decline the previous month.

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