The municipal market was unchanged Wednesday, amid light secondary trading activity ahead of Thursday’s Thanksgiving holiday.
“It’s quiet,” a trader in New York said. “There’s a little bit of trading here and there, but we’re pretty flat, and there’s not a whole lot going on, with the holiday tomorrow.”
“Really, no one expected there to be much going on today, the day before Thanksgiving, and there isn’t,” a trader in Los Angeles said. “If people had stuff they wanted to move, or were looking to buy anything, they did it early. But by the middle of the trading day, most people had taken off for the day. We should see some decent activity next week, but Friday is probably going to be just as quiet.”
The Treasury market mostly showed some losses Wednesday. The yield on the benchmark 10-year note opened at 3.30% and finished at 3.27%. The yield on the two-year note opened at 0.72% and finished at 0.75%. The yield on the 30-year bond finished at 4.23%, after opening at 4.24%.
Wednesday’s Municipal Market Data triple-A scale yielded 2.81% in 10 years and 3.75% in 20 years, matching levels of 2.81% and 3.75%, respectively, Tuesday. The scale yielded 4.29% in 30 years Wednesday, matching Tuesday’s level of 4.29%.
As of Wednesday’s close, the triple-A muni scale in 10 years was at 83.9% of comparable Treasuries, according to MMD, while 30-year munis were 100.0% of comparable Treasuries. Also, as of Wednesday’s close, 30-year tax-exempt triple-A rated general obligation bonds were at 104.6% of the comparable London Interbank Offered Rate.
In economic data released Wednesday, initial jobless claims decreased 35,000 to 466,000 in the week ended Nov. 21. Economists expected 500,000 initial claims, according to the median estimate from Thomson Reuters.
Personal spending rose 0.7% in October, more than economists’ estimates. September consumption declined by a revised 0.6%. Personal income increased 0.2% for the month, following an upwardly revised 0.2% increase in September. Core personal consumption expenditure, which excludes food and energy expenditures, increased 0.2% in October.
Economists polled by Thomson Reuters expected income to increase 0.2% and for consumption to increase 0.5%. The core PCE deflator was expected to be 0.1%.
New home sales increased 6.2% in October as buyers purchased homes at a 430,000 seasonally adjusted annual rate in October following an upwardly revised 405,000 rate in September. Economists expected 410,000 new home sales in October, according to the median estimate from Thomson Reuters.
Durable goods orders fell 0.6% in October as orders excluding transportation dropped 1.3%, the largest drop since March. Orders excluding transportation in September were revised higher to a 1.8% increase.
Economists expected durable goods orders to rise 0.5% for the month and for orders excluding transportation to rise 0.6%, according to the median estimate provided by Thomson Reuters.
The University of Michigan’s final November consumer sentiment index reading was 67.4, compared to the preliminary 66.0 reading and 70.6 in October. Economists polled by Thomson Reuters had predicted a 67.0 reading for the index.