Municipal bond traders are set to see the first of the week's healthy new issue supply come to market on Tuesday.
Secondary Market
Treasuries were higher on Tuesday. The yield on the two-year Treasury declined to 0.77% from 0.79% on Monday, while the 10-year Treasury yield dropped to 1.73% from 1.74% and the 30-year Treasury bond yield decreased to 2.61% from 2.62%.
Top quality municipal bonds finished flat on Monday. The yield on the 10-year benchmark muni general obligation was steady from 1.76% on Friday, while the 30-year muni yield was unchanged from 2.80%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Monday at 101.3% compared to 99.8% on Friday, while the 30-year muni to Treasury ratio stood at 107.1% versus 106.2%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 34,992 trades on Monday on volume of $6.88 billion.
Primary Market
Citigroup is set to price the Los Angeles Unified School District's $1.23 billion of general obligation and refunding bonds on Tuesday.
The deal is rated Aa2 by Moody's Investors Service, AAA by Fitch Ratings and AA-plus by Kroll Bond Rating Agency.
Since 2006, LAUSD has sold about $14.4 billion of bonds, with the most issuance occurring in 2007 and 2009 and when it offered $2.91 and $2.92 billion of debt, respectively. The district did not come to market in 2013.
Barclays Capital is expected to price the California Statewide Communities Development Authority's $282.74 million of Series 2016 student housing refunding revue bonds for the UC Irvine Campus Apartments on Tuesday. The deal is rated Baa1 by Moody's.
Barclays is also expected to price the New York's Utility Debt Securitization Authority's $381.73 million of Series 2016A tax-exempt restructuring bonds on Tuesday. The deal is rated triple-A by Moody's, S&P and Fitch.
Citi is set to price the New York City Municipal Water Authority's $335 million of water and sewer system second general resolution revenue bonds on Tuesday. The deal is rated Aa1 by Moody's, AAA by S&P and AA-plus by Fitch.
Citi will also price the Kentucky State Property and Buildings Commission's $668 million of Project No. 112 revenue bonds on Tuesday. The deal is rated Aa3 by Moody's, A by S&P and A-plus by Fitch.
In the competitive arena on Tuesday, Delaware will be selling three issues totaling $262.55 million, consisting of $164.84 million of Series 2016A GOs, $77.31 million of Series 2016C GO refunding bonds and $20.40 million of Series 2016B AMT GOs. All three sales are rated triple-A by Moody's, S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $504.9 million to $13.00 billion on Tuesday. The total is comprised of $2.98 billion of competitive sales and $10.02 billion of negotiated deals.
