Top-shelf municipal bonds were steady to stronger at mid-session, according to traders, as the last of this holiday-shortened week's supply was coming to market.
Secondary Market
The yield on 10-year benchmark muni general obligation was unchanged from 1.66% on Wednesday, while the 30-year muni yield was as much as one basis point weaker from 2.45%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were narrowly mixed on Thursday. The yield on the two-year Treasury slipped to 0.88% from 0.89% on Wednesday, while the 10-year Treasury yield dropped to 1.80% from 1.84% and the yield on the 30-year Treasury bond decreased to 2.58% from 2.62%.
The 10-year muni to Treasury ratio was calculated at 90.1% on Wednesday compared to 90.6% on Tuesday, while the 30-year muni to Treasury ratio stood at 93.4% versus 93.2%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,875 trades on Wednesday on volume of $10.96 billion.
Primary Market
Citigroup priced El Paso, Texas' $251.68 million of general obligation bonds and combination tax revenue certificates of obligation.
The $157.48 million of GOs were priced to yield from 2.16% with a 5% coupon in 2026 to 2.75% with a 5% coupon in 2036; a 2042 term bond was priced as 4s to yield 3.21%.
The $84.21 million of combination tax revenue certificates of obligation were priced to yield from 1% with a 5% coupon in 2018 to 2.75% with a 5% coupon in 2036. A term bond in 2042 was priced as 5s to yield 2.91%.
The deal is rated AA by S&P Global Ratings and Fitch Ratings.
Since 2006, El Paso has issued roughly $2.56 billion of debt, with the largest issuance occurring in 2014 when it sold $439 million of securities. The Sun City has sold debt every year since 2006, in fact, more than $100 million a year, except 2011 when it came to market with $69.6 million.
Barclays Capital priced the Sacramento Municipal Utility District's $151.43 million of Series 2016D electric revenue refunding bonds.
The bonds were priced to yield from 0.92% with 2% and 5% coupons in a split 2019 maturity to 2.23% with 2.125% and 5% coupons in a split 2028 maturity. The deal is rated Aa3 by Moody's Investors Service and AA-minus by both S&P and Fitch.
Citi is expected to price the Board of Trustees of Oakland University, Mich.'s $112 million of general revenue bonds on Thursday. The deal is rated A1 by Moody's.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $289.6 million to $11.96 billion on Thursday. The total is comprised of $7.38 billion of competitive sales and $4.57 billion of negotiated deals.
Tax-Exempt Money Market Funds See Outflows
Tax-exempt money market funds experienced outflows of $2.45 billion, bringing total net assets to $208.95 billion in the week ended May 30, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $987.8 million to $211.40 billion in the previous week.
The average, seven-day simple yield for the 296 weekly reporting tax-exempt funds was unchanged at 0.06%.
The total net assets of the 888 weekly reporting taxable money funds decreased $14.69 billion to $2.488 trillion in the week ended May 31, after an inflow of $25.30 billion to $2.503 trillion the week before.
The average, seven-day simple yield for the taxable money funds was 0.11%, up from 0.10% in the prior week.
Overall, the combined total net assets of the 1,184 weekly reporting money funds decreased $17.14 billion to $2.697 trillion in the period ended May 31, which followed an inflow of $24.31 billion to $2.714 trillion.
