Top-quality municipal bonds were stronger at mid-session, according to traders, who will be looking at a smaller than average bond calendar this week.
Volume is estimated at $4 billion, consisting of $3.4 billion of negotiated deals and $638.1 million of competitive sales. The state of Texas is selling the biggest deal of the week — a $5.4 billion note offering on Tuesday, which is also the biggest short-term sale so far this year.
The yield on the 10-year benchmark muni general obligation fell as much as one basis point from 1.91% on Friday, while the 30-year GO yield declined as much as one basis point from 2.76%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were little changed on Monday. The yield on the two-year Treasury was flat from 1.31% on Friday, the 10-year Treasury yield fell to 2.19% from 2.20% and the yield on the 30-year Treasury bond was steady from 2.78%.
On Friday, the 10-year muni-to-Treasury ratio was calculated at 87.0%, compared with 87.4% on Thursday, while the 30-year muni-to-Treasury ratio stood at 99.3% versus 99.7%, according to MMD.
MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 29,326 trades on Friday on volume of $7.11 billion.
Prior week's actively traded issues
Revenue bonds comprised 56.01% of new issuance in the week ended Aug. 18, down from 56.48% in the previous week, according to Markit. General obligation bonds made up 37.35% of total issuance, up from 37.02%, while taxable bonds accounted for 6.64%, up from 6.50%.
Some of the most actively traded bonds by type were from Illinois and Florida issuers.
In the GO bond sector, the Chicago Board of Education 7s of 2046 were traded 25 times. In the revenue bond sector, the Miami-Dade County aviation 5s of 2040 were traded 54 times. And in the taxable bond sector, the Miami-Dade County aviation 3.982s of 2041 were traded 56 times.
Previous week's top underwriters
The top municipal bond underwriters of last week included Bank of America Merrill Lynch, Citigroup, Wells Fargo Securities, Raymond James and Piper Jaffray, according to Thomson Reuters data.
In the week of Aug. 13 to Aug. 19, BAML underwrote $1.62 billion, Citi $1.43 billion, Wells $399.8 million, Raymond James $315.9 million, and Piper Jaffray $292.7 million.
Action will get underway on Tuesday, as Texas will sell by competitive bid $5.4 billion of Series 2017 tax and revenue anticipation notes.
The notes, due Aug. 20, 2018, are rated MIG1 by Moody’s Investors Service, SP1-plus by S&P Global Ratings, F1-plus by Fitch Ratings and K1-plus by Kroll Bond Rating Agency.
Also on Tuesday, the Bend La Pine Administrative School District No. 1, Ore., is competitively selling $175 million of Series 2017 general obligation bonds.
The deal, which is backed by the Oregon School Bond Guaranty program, is rated Aa1 by Moody’s and AA-plus by S&P.
In the negotiated sector on Tuesday, Wells Fargo Securities is set to price the Washington Health Care Facilities Authority’s $265.895 million of Series 2017 revenue bonds for the Virginia Mason Medical Center.
The deal is rated Baa2 by Moody’s and BBB by S&P.
Piper Jaffray is expected to price the South Dakota Health and Education Facilities Authority’s $210 million of Series 2017 revenue bonds for Regional Health.
The deal is rated A1 by Moody’s.
Bank of America Merrill Lynch is set to price Jacksonville, Fla.’s $146 million of Series 2017A and 2017B special revenue and refunding bonds.
The deal is rated Aa2 by Moody’s and AA-minus by S&P and Fitch.
Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar increased $769.2 million to $7.70 billion on Monday. The total is comprised of $3.32 billion of competitive sales and $4.38 billion of negotiated deals.