Top quality municipal bonds were steady in quiet activity at mid-session as trading resumed after the long Easter holiday weekend.
Traders will see over $6 billion of new issuance hit the screens this week as the calendar consists of $4.45 billion of negotiated deals and $1.66 billion of competitive sales.
Secondary Trading
The yield on the 10-year benchmark muni general obligation was flat from 1.82% on Thursday, while the 30-year muni yield was unchanged at 2.76%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were stronger on Monday. The yield on the two-year Treasury dipped to 0.86% from 0.87% on Thursday, while the 10-year Treasury yield dropped to 1.87% from 1.90% and the 30-year Treasury bond yield declined to 2.64% from 2.67%.
The 10-year muni to Treasury ratio was calculated on Thursday at 96.3% compared with 97.2% on Wednesday, while the 30-year muni to Treasury ratio stood at 103.8% versus 104.1%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 26,296 trades on Thursday on volume of $11.26 billion.
Previous Week's Most Actively Traded Issues
Revenue bonds comprised 52.35% of new issuance in the week ended March 25, up from 51.82% in the previous week, according to
Some of the most actively traded issues were in Connecticut and Tennessee. In the GO bond sector, the Connecticut 4s of 2036 traded 105 times. In the revenue bond sector, the Nashville and Davidson Health and Educational Facilities Board 5s of 2046 traded 134 times. And in the taxable bond sector, the Nashville and Davidson Health and Educational Facilities Board 4.053s of 2026 traded 157 times, Markit said.
Primary Market
JPMorgan Securities is expected to price the Houston Independent School District’s $683.6 million of Series 2016A limited tax schoolhouse and refunding bonds on Tuesday. The bonds are rated triple-A by Moody’s and Standard & Poor’s.
Barclays Capital is set to price California State University’s $1.34 billion of Series 2016 A & B revenue bonds on Tuesday for retail investors ahead of the institutional pricing on Wednesday. The bonds are rated Aa2 by Moody’s.
Morgan Stanley is expected to price Tampa, Fla.’s $200 million of Series 2016A health system revenue bonds for Baycare Health System on Tuesday. The bonds are rated AA by Fitch.
In the competitive arena on Tuesday, the Central Florida Expressway Authority will be offering $154.67 million of Series 2016A senior lien refunding revenue bonds. The issue is rated A2 by Moody’s and A by S&P and Fitch.
Palm Beach County, Fla., will competitively sell $126.65 million of Series 2016 revenue refunding bonds on Tuesday. The deal is rated Aa1 by Moody’s and AA-plus by S&P and Fitch.
And the Virginia Public School Authority will competitively sell on Tuesday $148.90 million of Series 2016 special obligation school financing and refunding bonds for Prince William County. The bonds are rated triple-A by Moody’s, S&P and Fitch.
The state of Michigan will be taking bids on Tuesday for its $87.2 million of Series 2016A tax-exempt general obligation environmental program bonds. The deal is rated Aa1 by Moody’s and AA-minus by S&P.
The state last sold comparable tax-exempt bonds competitively on Nov. 15, 2012, when Wells Fargo Securities won $92 million of Series 2012 tax-exempt GO environmental program refunding bonds with a true interest cost of 1.09%. The state last sold comparable taxable bonds competitively on Nov. 6, 2013, when Wells Fargo won $30 million of Series 2013A taxable GO environmental program refunding bonds with a TIC of 0.44%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $605 million to $9.18 billion on Monday. The total is comprised of $2.69 billion of competitive sales and $6.49 billion of negotiated deals.
Muni Bond Funds See Inflows for 25th Straight Week
For the 25th week in a row, municipal bond funds reported inflows, according to Lipper data released late Thursday.
Weekly reporting funds saw $901.500 million of inflows in the week ended March 23, after inflows of $780.007 million in the previous week, Lipper said. The four-week moving average remained positive at $603.004 million after being in the green at $551.727 million in the previous week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.
Long-term muni bond funds also experienced inflows, gaining $643.831 million in the latest week after inflows of $522.398 million in the previous week. Intermediate-term funds had inflows of $258.537 million after inflows of $230.746 million in the prior week.
National funds saw inflows of $772.198 million after inflows of $617.603 million in the prior week. High-yield muni funds reported inflows of $273.005 million in the latest reporting week, after inflows of $229.613 million the previous week.
Exchange traded funds saw inflows of $85.863 million, after inflows of $104.430 million in the previous week.
