The municipal market weakened slightly Wednesday following two sessions of substantial losses, as more than $1 billion of Build America Bonds hit the primary with only two weeks remaining in the taxable bond program.

"I wouldn't exactly say we're better, because we're not, but it feels a little better," a trader in Los Angeles said. "Then again, being off a basis point or two certainly feels better than being down 10. It's still pretty messy out there, though, and I suspect that won't change until the new year."

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