The municipal market was firmer by yesterday, following Treasuries. Traders said tax-exempt yields were lower by three or four basis points.

"There wasn't much going on early, but it turned around," a trader in New York said. "We ended up seeing pretty decent activity out there, and we saw some gains. Overall, it was a pretty positive day. We saw some more activity later on, when stocks kind of fell off, and Treasuries increased their gains. But we had been in positive territory all day, so we just kept on keeping on, so to speak."

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