Top-shelf municipal bonds were stronger at mid-session, traders said, ahead of $3.1 billion of new supply slated to hit the market in the upcoming holiday-shortened trading week.
Markets are closed Friday, Nov. 11, for Veterans Day.
Ipreo estimates volume for next week at $3.12 billion, less than half the $6.31 billion sold this week, according to revised data from Thomson Reuters.
Next week's calendar is made up of $2.36 billion of negotiated deals and $758 million of competitive sales.
Secondary Market
The yield on the 10-year benchmark muni general obligation fell as much as one basis point from 1.70% on Thursday, while the yield on the 30-year was as much as one basis point lower from 2.53%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were stronger on Friday after the jobs report. Friday's employment report for October came in weaker than expected, as non-farm payrolls rose 161,000 last month. Economists surveyed by IFR Markets had predicted a gain of 175,000 jobs. The October unemployment rate fell to 4.9% from 5.0%, in line with analysts' forecasts.
The yield on the two-year declined to 0.79% from 0.81% on Thursday, the 10-year Treasury dropped to 1.77% from 1.82% and the yield on the 30-year Treasury bond decreased to 2.56% from 2.61%.
On Thursday, the 10-year muni to Treasury ratio was calculated at 93.9% compared to 94.7% on Wednesday, while the 30-year muni to Treasury ratio stood at 97.3% versus 98.8%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,479 trades on Thursday on volume of $10.56 billion.
Week's Most Actively Traded Issues
Some of the most actively traded issues by type in the week ended Nov. 4 were from Puerto Rico, New York & New Jersey and Texas, according to
In the GO bond sector, the Puerto Rico Commonwealth 8s of 2035 were traded 20 times. In the revenue bond sector, the Port Authority of New York & New Jersey 5.25s of 2056 were traded 64 times. And in the taxable bond sector, the New Hope Cultural Education Facilities Finance Corp., Texas, 4.032s of 2014 were traded 19 times.
Week's Most Actively Quoted Issues
Minnesota, Ohio and New Jersey issues were among the most actively quoted bonds in the week ended Nov. 4, according to Markit.
On the bid side, the Minneapolis & St. Paul Metropolitan Airports Commission revenue 5s of 2021 were quoted by 120 unique dealers. On the ask side, the Ohio Higher Educational Facilities Commission revenue 3.25s of 2034 were quoted by 279 unique dealers. And among two-sided quotes, the New Jersey Economic Development Authority revenue 2.421s of 2018 were quoted by 19 unique dealers.
Week's Primary Market
The market saw a slew of new issues price during the week.
Bank of America Merrill Lynch priced Chicago's $1.02 billion of O'Hare airport senior lien revenue refunding bonds. The deal consisted of $27.41 million of Series 2016A bonds, subject to the alternative minimum tax, $463.19 million of Series 2016B non-AMT bonds, and $527.48 million of Series 2016C non-AMT bonds. The deal is rated A by S&P Global Ratings and Fitch Ratings.
BAML also priced the Illinois Finance Authority's $107.96 million of Series 2016A tax-exempt bonds for the Swedish Covenant Hospital. The deal is rated BBB by S&P and BBB-plus by Fitch.
In the competitive arena, the state of Illinois sold $480 million of Series of November 2016 general obligation bonds. BAML won the bonds with a true interest cost of 2.45%. The deal is rated Baa2 by Moody's Investors Service, BBB by S&P and BBB-plus by Fitch.
Citigroup priced the Port Authority of New York and New Jersey's $587.75 million of consolidated bonds. The deal is rated Aa3 by Moody's and AA-minus by S&P and Fitch.
Goldman Sachs priced the Dormitory Authority of the State of New York's $404.17 million of Series 2016A tax-exempt and Series 2016B taxable revenue bonds for the New School. The DASNY deal is rated A3 by Moody's and A-minus by S&P.
Morgan Stanley priced the Phoenix Civic Improvement Corp.'s $225.33 million of Series 2016 junior lien wastewater system revenue refunding bonds. The deal is rated Aa2 by Moody's and AA-plus by S&P.
JPMorgan Securities priced the Montana Facility Finance Authority's $141.05 million of Series 2016 hospital revenue bonds for the Benefis Health System Obligated Group. The deal is rated A-minus by S&P and A by Fitch.
Raymond James & Associates priced the Virginia Resource Authority's $146.77 million of Series 2016C infrastructure revenue bonds under the state's pooled financing program. The deal is rated triple-A by Moody's and S&P.
RBC Capital Markets priced the Connecticut Housing Finance Authority's $170.88 million of housing mortgage finance program bonds in six series. The deal is rated triple-A by Moody's and S&P.
Bank of America Merrill Lynch priced the South Carolina Jobs-Economic Development Authority's $101.53 million of Series 2016 hospital refunding revenue bonds for the Anmed Health project. The deal is rated A-plus by S&P and Fitch.
Back in the competitive arena, the Bellevue School District No. 405, Wash., sold $239.17 million of Series 2016 unlimited tax general obligation and refunding bonds. Citigroup won the bonds with a true interest cost of 2.32%. The deal, backed by the Washington State School District Credit Enhancement Program, is rated Aa1 by Moody's and AA-plus by S&P.
The state of Ohio sold $150 million of Series 2016B infrastructure improvement GO bonds. BAML won the bonds with a true interest cost of 2.99%. The deal is rated Aa1 by Moody's and AA-plus by S&P and Fitch.
The North Kansas City School District No. 74, Mo., sold $114 million of Series 2016B limited tax GO school improvement bonds under the Missouri Direct Deposit Program. Raymond James won the bonds with a TIC of 2.72%. The deal is rated Aa1 by Moody's and AA-plus by S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $1.42 million to $7.21 billion on Friday. The total is comprised of $2.19 billion of competitive sales and $5.02 billion of negotiated deals.
Lipper: Muni Bond Funds See Outflows
Municipal bond funds reported that investor money once again made an about-face and left the market, according to Lipper data released on Thursday.
The weekly reporters saw $323.644 million of outflows in the week ended Nov. 2, after inflows of $334.917 million in the previous week.
The four-week moving average barely remained positive at $5.662 million after being in the green at $167.723 million in the previous week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.
Long-term muni bond funds experienced outflows, losing $297.795 million in the latest week after inflows of $216.109 million in the previous week. Intermediate-term funds had outflows of $35.461 million after inflows of $90.083 million in the prior week.
National funds had outflows of $264.054 million after inflows of $337.143 million in the previous week. High-yield muni funds reported outflows of $191.896 million in the latest reporting week, after inflows of $33.092 million the previous week.
Exchange traded funds saw inflows of $14.713 million, after inflows of $79.104 million in the previous week.
