Top-shelf municipal bond yields were lower on Monday through midday, as much as three basis points on some maturities, according to traders.
Secondary Market
The yield on the 10-year benchmark muni general obligation was as many as two basis points lower from 2.48% on Friday, while the yield on the 30-year was between one and three basis points lower from 3.21%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were stronger on Monday around midday. The yield on the two-year Treasury fell to 1.22% from 1.25% on Friday as the 10-year Treasury yield was lower at 2.55% from 2.59%, while the yield on the 30-year Treasury bond decreased to 3.12% from 3.18%.
The 10-year muni to Treasury ratio was calculated at 95.4% on Friday compared to 96.3% on Thursday while the 30-year muni to Treasury ratio stood at 100.8% versus 102.2%, according to MMD.
Primary Market
Volume for this week is forecast by Ipreo to drop to $481 million, way down from a revised total of $4.17 billion in the previous week, according data from Thomson Reuters. The calendar is comprised of $210 million of negotiated deals and $271 million of competitive sales.
There are no negotiated deals on the calendar larger than $100 million; in fact, the largest negotiated deal is just $62 million. The bulk of the little issuance we will see this week will be coming on Tuesday.
The commonwealth of Massachusetts is scheduled to set sell two competitive deals, totaling $188.49 million of general obligation refunding SIFMA index bonds on Tuesday. The sales are broken down into $100 million and $88.49 million and both parts are rated Aa1 by Moody's Investors Service and AA-plus by S&P Global Ratings and Fitch Ratings.
George K. Baum and Co. is slated to run the books on that transaction for the Weld County School District RE-1 Colo.'s GO bonds. It is expected some maturities will be insured by Assured Guaranty. The deal and is rated Aa2 by Moody's and AA by S&P.
Mesirow Financial is expected to price Community High School District No. 28, Ill.'s $51.21 million of taxable GO limited tax school bonds and qualified school construction bonds. The deal is rated Aa3 by Moody's.
Prior Week's Actively Traded Issues
Revenue bonds comprised 59.43% of new issuance in the week ended Dec. 12, down from 60.33% in the previous week, according to
Some of the most actively traded issues by type were from New York, Missouri and Alabama. In the GO bond sector, the Suffolk County. N.Y., 2s of 2017 were traded 40 times. In the revenue bond sector, the Metropolitan St. Louis Sewer District, Mo., 5s of 2046 were traded 37 times. And in the taxable bond sector, the Alabama Economic Settlement Authority 4.263s of 2032 were traded 14 times.
Previous Week's Top Underwriters
The top negotiated and competitive underwriters of last week included Barclays, Piper Jaffray, Stifel, Morgan Stanley and RBC Capital Markets, according to Thomson Reuters data. In the week of Dec. 11-Dec. 17, Barclays underwrote $1.46 billion, Piper $574.3 million, Stifel $484 million, Morgan Stanley $361.2 million and RBC $292.9 million.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 51,263 trades on Monday on volume of $12.384 billion.
