Prices of top-rated municipal bonds were mixed at mid-session, traders said, with yields on some maturities steady to one basis point higher.
In the primary, the tax-exempt bond market was seeing the first of the week's bigger offerings being sold, with new deals from Texas, Florida and Massachusetts issuers coming to market.
In the equities sector, the New York Stock Exchange suffered technical problems and shut down trading.
Secondary Market
The yield on the 10-year benchmark muni general obligation was flat from 2.22% on Tuesday, while the yield on the 30-year GO was down by as much as one basis point from 3.21%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were mixed, but little changed, on Wednesday, with the yield on the two-year Treasury note remaining flat at 0.57% from Tuesday, while the 10-year yield was flat at 2.22% and the 30-year yield increased to 3.01% from 3.00%.
"Muni traders should note some technically significant levels that are nearby the 2.22% close on the triple-A MMD 10-year index," MMD Senior Market Analyst Randy Smolik wrote in a Wednesday market comment. "One should note the range in yields from April 6 from 1.91% to 2.38%. A 38% retrace is at 2.20%. Re-enforcing that level was a note major yield low of 2.19% that occurred on May 29. The next retracement level of note would be at 2.14%."
The 10-year muni to Treasury ratio was calculated on Tuesday at 100.5% versus 99.0% on Monday, while the 30-year muni to Treasury ratio stood at 106.6% compared to 104.4%, according to MMD.
Primary Market
In the negotiated sector on Wednesday, JPMorgan priced Austin, Texas' $244 million of Series 2015A water and wastewater system revenue refunding bonds.
The bonds were priced to yield from 0.57% with a 2% coupon in 2016 to yield 3.39% with a 5% coupon in 2036. The issue was rated Aa2 by Moody's Investors Service, AA by Standard & Poor's and AA-minus by Fitch Ratings.
RBC Capital Markets priced the Desert Sands Unified School District, Calif.'s $159.12 million of Series 2015 Election of 2014 general obligation bonds and Series 2015 GO refunding bonds.
The $75 million of Election of 2014 GOs were priced to yield from 0.36% with a 2% coupon in 2016 to 3.47% with a 5% coupon in 2038; a 2042 term bond was priced as 5s to yield 3.58% and a 2044 term was priced as 4s to yield approximately 4.104%. The $84.12 million of Series 2015 refunding GOs were priced to yield 0.20% with a 2% coupon in 2015 and from 1.21% with a 4% coupon in 2019 to 3.12% with a 4% coupon in 2028. The issue was rated Aa2 by Moody's and AA-minus by S&P.
Citigroup priced the Massachusetts Port Authority's $173.15 million of Series 2015A non-AMT and Series 2015B AMT revenue bonds on Wednesday.
The non-AMT series 2015-A bonds for $105.54 million were priced as 5s to yield from 1.14% in 2019 to 3.31% in 2035. Term bonds in 2040 and 2045 were priced as 5s to yield 3.46% and 3.66%. The series 2015-B AMT series bonds for $67.61 million were priced as 5s to yield from 1.39% in 2019 to 3.64% in 2035.Term bonds in 2040 and 2045 were priced as 5s to yield 3.76% and 3.86%. The deal was rated Aa2 by Moody's and AA by S&P and Fitch.
In the competitive sector, the Central Florida Expressway Authority sold $194 million of Series 2015 senior lien revenue bond anticipation notes. Wells Fargo Securities won the notes with a true interest cost of 1.59%. The BANs were priced as 1 5/8s to yield 1.50% in 2019. The notes were rated A2 by Moody's and A by S&P and Fitch.
Hillsborough County, Fla., sold $140 million of Series 2015 community investment tax refunding revenue bonds. JP Morgan won the issue with a TIC of 2.19%. Pricing information was not immediately available. The bonds were rated AA2 by Moody's.
The Clark County Water District, Nev., sold $100 million of Series 2015 limited tax GO water reclamation refunding bonds, which are additionally secured by pledged revenues. Barclays Capital won the bonds; a TIC was unavailable. The bonds were priced to yield from 1.21% with a 5% coupon in 2019 to 3.77% with a 4% coupon in 2038. The issue was rated Aa1 by Moody's and triple-A by S&P.
The Metropolitan Council of Minnesota sold three separate issues of general obligation bonds totaling $151 million. Bank of America Merrill Lynch won the largest deal -- the $100 million of Series 2015C GO wastewater revenue bonds. A TIC was unavailable. The bonds were priced to yield from 0.26% with a 5% coupon to 3.41% with a 3.75% coupon in 2035.
On Thursday, the North Carolina Municipal Power Agency Number 1's $463 million of refunding bonds scheduled to be priced by Morgan Stanley.
The issue is initially structured as Series 2015 A, B and C refunding bonds, Series 2015 D taxable refunding bonds and Series 2015 E forward delivery bonds for Catawba Electric. The bonds are rated A by S&P and Fitch.
Since 1995, the North Carolina Municipal Power Agency No. 1 has issued more than $3.61 billion dollars of debt. The years of 2003 and 2012 saw the most issuance with $923 million and $605 million, respectively. The NCMPA No. 1 did not come to market at all in the 1996, 2000-2002, 2004, 2006-2007, 2011 or 2013-2014.
Also on Thursday, the Illinois State Toll Highway Authority's $400 million of Series 2015A toll highway senior revenue bonds are expected to be priced by Bank of America Merrill Lynch. The bonds are rated Aa3 by Moody's and AA-minus by S&P and Fitch.
This deal is the first of two new-money borrowings to finance a record year of capital spending. The $1.6 billion of capital spending planned this year is part of the 15-year, $12 billion Move Illinois capital program launched in 2011. The authority operates 286 miles of toll highways in 12 counties in northern Illinois.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 43,222 trades on Tuesday on volume of $8.069 billion. The most active bond, based on the number of trades, was the Corpus Christi, Texas, Series 2015C utility system junior lien revenue improvement 4 1/8s of 2045, which traded 219 times at an average price of 100.198 with an average yield of 4.086%. The bonds were initially priced at 97.725 to yield 4.26%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $169.4 million to $12.10 billion on Wednesday. The total is comprised of $3.78 billion competitive sales and $8.32 billion of negotiated deals.
