Municipals were steady Friday as U.S. Treasury yields fell in spots and equities ended mixed.
The two-year muni-UST ratio Friday was at 67%, the five-year at 69%, the 10-year at 75% and the 30-year at 93%, according to Municipal Market Data's 3 p.m. ET read. ICE Data Services had the two-year at 66%, the five-year at 68%, the 10-year at 73% and the 30-year at 92% at 4 p.m.
Investors added $110.5 million to municipal bond mutual funds in the week ended Wednesday, following $523.2 million of inflows the prior week, according to LSEG Lipper data.
High-yield funds saw inflows of $57.7 million compared to the previous week's inflows of $138 million.
With one full week of June left and the end of the second quarter approaching, the week was "a sort of Groundhog Day for municipal yields," said Kim Olsan, senior fixed income portfolio manager at NewSquare Capital.
"Major spot levels have traded in rather narrow ranges," Olsan said. "The 10- and 30-year MMD spots have held just 3-5 basis point spreads between the month's highs and lows."
Investors were mainly concentrated on the primary market, BofA strategists said.
June is set to be one of the highest supply months seen in recent years at over $50 billion, Olsan said.
Meanwhile, secondary market trading was light, BofA strategists said.
On the back end of that volume, secondary trading was "rather muted, likely driven by healthy call and maturity credits that have offset cash-raise needs," Olsan said.
June's total secondary trade counts show an average of 75,000 daily transactions, a 15% increase year-over-year, she said, citing MSRB data.
"Engagement is further encouraged by the generous curve slope where extensions are being well rewarded," Olsan said.
"Implied yield pickups from 2030 to 2035 are near 70 basis points (the 10s5s UST curve is 40 basis points) and 25-year, high-grade munis yield about 100 basis points more than 10-year equivalents (the 30s10s UST slope is half that)," she said.
"Recent trades such as Aa2/AA Portland, Oregon, sewer revenue 5s due 2049 (call 2035) near 4.70% represent strong absolute value as well as the liquidity that sizable issues provide," Olsan noted.
New-issue calendar
Issuance for the week of June 23 is estimated at $9.749 billion, with $7.993 billion of negotiated deals and $1.756 billion of competitive deals on tap, according to LSEG.
Los Angeles leads the negotiated calendar with $1.513 billion of 2025 tax and revenue anticipation notes.
The competitive calendar is led by the Phoenix Civic Improvement Corp. with $359.615 million of subordinated excise tax revenue bonds.
AAA scales
MMD's scale was unchanged: The one-year was at 2.62% and 2.63% in two years. The five-year was at 2.73%, the 10-year at 3.30% and the 30-year at 4.54% at 3 p.m.
The ICE AAA yield curve was unchanged: 2.68% in 2026 and 2.59% in 2027. The five-year was at 2.73%, the 10-year was at 3.22% and the 30-year was at 4.50% at 4 p.m.
The S&P Global Market Intelligence municipal curve was unchanged: The one-year was at 2.62% in 2025 and 2.62% in 2026. The five-year was at 2.72%, the 10-year was at 3.30% and the 30-year yield was at 4.53% at 4 p.m.
Bloomberg BVAL was unchanged: 2.63% in 2025 and 2.65% in 2026. The five-year at 2.76%, the 10-year at 3.25% and the 30-year at 4.49% at 4 p.m.
Treasuries were slightly firmer 10 years and in.
The two-year UST was yielding 3.907% (-4), the three-year was at 3.862% (-3), the five-year at 4.962% (-3), the 10-year at 4.378% (-1), the 20-year at 4.904% (flat) and the 30-year at 4.892% (flat) near the close.
Primary to come
Los Angeles is set to price Wednesday $1.513 billion of 2025 tax and revenue anticipation notes. BofA Securities.
The North Texas Municipal Water District (Aa1/AAA//) is set to price Thursday $884.59 million of water system revenue refunding and improvement bonds. J.P. Morgan.
The Michigan State Building Authority (Aa2//AA/) is set to price Wednesday $752.745 million of facilities program 2025 revenue and revenue refunding bonds, Series I. Barclays.
The Katy Independent School District, Texas, (Aaa/AAA//) is set to price Monday $447.32 million of PSF-insured unlimited tax school building bonds. Wells Fargo.
Seattle (Aa2/AA//) is set to price Tuesday $444.59 million of municipal light and power improvement and refunding revenue bonds. BofA Securities.
The Mansfield Independent School District (/AAA/AAA/) is set to price Wednesday $380.92 million of PSF-insured unlimited tax school building bonds. Raymond James.
The Ohio Water Development Authority (Aaa/AAA//) is set to price Tuesday $350 million of drinking water assistance fund revenue bonds, Series 2025 A. Stifel.
The Klein Independent School District, Texas, is set to price Tuesday $345.615 million, consisting of $339.705 million of PSF-insured unlimited tax schoolhouse and refunding bonds (Aaa/AAA//) and $5.91 million of non-PSF insured unlimited tax refunding bonds (Aa1/AA//). Raymond James.
The Higher Educational Facilities Financing Authority, Florida, (/BB+//) is set to price Wednesday $304.22 million of Keiser University project higher educational facilities revenue bonds. D.A. Davidson.
Corpus Christi, Texas, (/AA-/AA-/) is set to price Thursday $286.915 million of utility system senior lien revenue improvement and refunding bonds. Morgan Stanley.
The Missouri Housing Development Commission (/AA+//) is set to price Tuesday $250 million of non-AMT First Place Homeownership Loan Program single-family mortgage revenue bonds, 2025 Series D. Raymond James.
The Point Phase 1 Public Infrastructure District No. 1, Utah, is set to price Thursday $248.055 million, consisting of $192.11 million of tax assessment and general revenue bonds, Series 2025A-1; $16.665 million of tax assessment and general revenue convertible capital appreciation bonds, Series 2025A-2; and $39.28 million of subordinate tax assessment and general revenue bonds, Series 2025B. Sandler.
The Public Finance Authority is set to price Thursday $175 million of tax-exempt pooled securities, Series 2025-1 Class A certificates. J.P. Morgan.
The Virginia Resources Authority (Aaa/AAA//) is set to price $167.745 million of state revolving fund revenue refunding bonds. Ramirez.
The Wimberley Independent School District, Texas, (/AAA//) is set to price Tuesday $148.365 million of PSF-insured unlimited tax school building and refunding bonds. HilltopSecurities.
The Lake Stevens School District No. 4, Washington, (Aaa///) is set to price Wednesday $116.39 million of unlimited tax GOs. D.A. Davidson.
Competitive
The Phoenix Civic Improvement Corp. is set to sell $359.615 million of subordinated excise tax revenue bonds at 11:15 a.m. Eastern Tuesday.
San Diego County is set to sell $200 million of 2025 tax and revenue anticipation notes at 11:30 a.m. Wednesday.
The Bend-La Pine Schools, Oregon, is set to sell $149.7 million of Oregon School Bond Guaranty Program GOs at noon Wednesday.
Hempstead, New York, is set to sell $137.319 million of public improvement serial bonds at 11 a.m. Tuesday.
The Manalapan-Englishtown Regional Board of Education, New Jersey, is set to sell $115.378 million of school bonds at 11 a.m. Tuesday.
Alex Walters contributed to this report.
