Top-rated municipal bonds were unchanged at mid-session as some market participants returned to their desks after the long holiday weekend for a week that is historically one of the quietest of the year.
Secondary Market
The 10-year benchmark muni general obligation yield was flat from 2.39% on Friday, while the yield on the 30-year GO was steady from 3.11%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were weaker on Tuesday. The yield on the two-year Treasury rose to 1.22% from 1.20% on Friday, while the 10-year Treasury yield increased to 2.57% from 2.54%, and the yield on the 30-year Treasury bond gained to 3.15% from 3.11%.
On Friday, the 10-year muni to Treasury ratio was calculated at 94.1%, compared with 94.5% on Thursday, while the 30-year muni to Treasury ratio stood at 100.0%, versus 100.0%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 23,724 trades on Friday on volume of $7.88 billion.
Prior Week's Actively Traded Issues
Revenue bonds comprised 59.08% of new issuance in the week ended Dec. 23, down from 59.43% in the previous week, according to Markit. General obligation bonds comprised 36.38% of total issuance, up from 35.82%, while taxable bonds made up 4.54%, down from 4.75%.
Some of the most actively traded issues by type were from Puerto Rico, Florida and California.
In the GO bond sector, the Puerto Rico 8s of 2035 were traded 31 times. In the revenue bond sector, the Miami-Dade County, Fla. Aviation 5s of 2041 were traded 21 times. And in the taxable bond sector, the California 7.3s of 2039 were traded 12 times.
Primary Market
Market participants won't have any new issuance to work with this week, as action in the primary won't get started up again until the New Year.
Volume for the week is forecast by Ipreo to drop to about $2 million, and that's comprised of only one competitive bond sale of $2 million and no negotiated deals at all.
Issuers have pretty much packed it in and supply is not expected to reach more normal levels again until 2017.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $522 million to $6.91 billion on Tuesday. The total is comprised of $1.30 billion of competitive sales and $5.61 billion of negotiated deals.
