Top-rated municipal bonds were steady to a tad weaker at midday, according to traders, as the market saw a chunky slate of new issues being offered.
Secondary Market
The yield on the 10-year benchmark muni general obligation was as much as one basis point stronger from 1.66% on Wednesday, while the 30-year muni yield was steady from 2.78%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were higher on Thursday. The yield on the two-year Treasury slipped to 0.72% from 0.74% on Wednesday, while the 10-year Treasury yield dropped to 1.78% from 1.82% and the 30-year Treasury bond yield fell to 2.64% from 2.68%.
The 10-year muni to Treasury ratio was calculated on Wednesday at 91.4% compared to 91.2% on Tuesday, while the 30-year muni to Treasury ratio stood at 103.4% versus 103.0%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,736 trades on Wednesday on volume of $6.88 billion.
Primary Market
Ramirez & Co. priced the New York Metropolitan Transportation Authority's $721.09 million of Series 2016-A1 transportation revenue green bonds and Series 2016-A2 transportation revenue refunding green bonds for institutions after a one-day retail order period.
The $432.93 million of Series 2016-A1 bonds were priced to yield from 0.56% with a 4% coupon in 2017 to 2.92% with a 5% coupon in 2036. A 2041 split maturity was priced as 3 1/2s to yield 3.65% and as 5s to yield 3.18% while a 2046 split maturity was priced as 4s to yield 3.58% and as 5 1/4s to yield 3.43%. A 2016 maturity was offered as a sealed bid.
The $288.16 million of Series 2016-A2 bonds were priced to yield from 0.87% with a 5% coupon in 2019 to 2.50% at par and 2.40% with a 5% coupon in a split 2028 maturity.
The deal is rated A1 by Moody's Investors Service, AA-minus by Standard & Poor's, A by Fitch Ratings and AA-plus by Kroll Bond Rating Agency.
Since 2006, the New York City MTA issued bonds an average of 7.1 times a year, selling about $28 billion, with the largest issuances in 2010 and 2012 when it offered $3.5 billion and $6.7 billion, respectively, and the lows in 2007 and 2011, when it issued $1.3 billion and $1.6 billion, respectively.
JPMorgan Securities priced the Oregon Health and Science University's $196.23 million of Series 2016B revenue bonds for institutions after the deal priced for retail investors on Wednesday.
The issue was priced to yield 2.69% with a 2.50% coupon and 2.49% with a 4% coupon and 2.36% with a 5% coupon in a triple-split 2028 maturity. The bonds were also priced to yield from 3.25% with a 3.125% coupon and 2.80% with a 5% coupon in a split 2033 maturity to 3.55% with a 3.375% coupon and 3.05% with a 5% coupon in a split 2039 maturity. A 2046 term bond was priced as 4s to yield 3.60%.
The deal is rated Aa3 by Moody's and AA-minus by S&P and Fitch.
Estrada Hinojosa & Co. priced the Pharr-San Juan-Alamo Independent School District, Texas' $107.79 million of Series 2016 unlimited tax refunding bonds.
The issue was priced to yield from 0.55% in 2017 with a 3% coupon to 2.84% with a 5% coupon in 2038; a 2016 maturity was offered as a sealed bid.
The deal is backed by the Permanent School Fund guarantee program and is rated triple-A by Moody's and S&P.
In the competitive arena, the Los Angeles County Metropolitan Transportation Authority sold $188.27 million of Series 2016A Proposition A first tier senior sales tax revenue refunding bonds. JPMorgan Securities won the issue with a true interest cost of 1.64%. Pricing information was not immediately available. The deal is rated Aa1 by Moody's and triple-A by S&P.
Frisco Independent School District, Texas competitively sold $110.25 million of Series 2016 unlimited tax refunding bonds. Bank of America Merrill Lynch won the issue with a TIC of 2.98%. The bonds were priced to yield from 0.40% with a 4% coupon in 2016 to approximately 3.10% at 98.50 with a 3% coupon in 2035; a 2037 maturity was priced at 97.25 as 3s to yield about 3.18%. The deal is backed by the PSF and is rated triple-A by Moody's and S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $114.4 million to $8.7 billion on Thursday. The total is comprised of $2.83 billion of competitive sales and $5.87 billion of negotiated deals.
Tax-Exempt Money Market Funds Post Outflows
Tax-exempt money market funds experienced outflows of $3.40 billion, bringing total net assets to $242.84 billion in the week ended Feb. 15, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $1.13 billion to $246.24 billion in the previous week.
The average, seven-day simple yield for the 354 weekly reporting tax-exempt funds remained at 0.01% for the 146th straight week.
The total net assets of the 945 weekly reporting taxable money funds increased $3.30 billion to $2.521 trillion in the week ended Feb. 16, after an outflow of $5.35 billion to $2.518 trillion in the prior week.
The average, seven-day simple yield for the taxable money funds remained at 0.10% for the second week in a row.
Overall, the combined total net assets of the 1,299 weekly reporting money funds fell $96.7 million to $2.764 trillion in the period ended Feb. 16, which followed an outflow of $6.48 billion to $2.764 trillion.
