Munis were mostly stronger on Friday around midday, as yields on some maturities were lower by as much as four basis points, according to traders, who are looking ahead to next week's whopping $12.7 billion of estimated volume next week.
Secondary Market
Top-shelf municipal bonds were mostly higher on Friday afternoon. The yield on 10-year benchmark muni general obligation was anywhere from two to four basis points lower from 1.66% on Thursday, while the 30-year muni yield was anywhere from one to three basis points lower from 2.43% on Thursday, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were stronger on Friday afternoon. The yield on the two-year Treasury fell to 0.78% from 0.88% on Thursday, while the 10-year Treasury yield declined to 1.71% from 1.81% and the yield on the 30-year Treasury bond decreased to 2.50% from 2.58%.
The 10-year muni to Treasury ratio was calculated at 91.8% on Thursday compared to 90.1% on Tuesday, while the 30-year muni to Treasury ratio stood at 94.0% versus 93.4%, according to MMD.
The Week's Most Actively Traded Issues
Some of the most actively traded issues by type in the week ended June 3 were from Massachusetts and New York issuers, according to data released by
In the GO bond sector, the Massachusetts Educational Financing Authority 3.5s of 2033 were traded 29 times. In the revenue bond sector, the Dormitory Authority of the State of New York 4s of 2043 were traded 37 times. And in the taxable bond sector, the Dormitory Authority of the State of New York 3.879s of 2046 were traded 66 times, Markit said.
The Week's Most Actively Quoted Issues
California and Illinois issues were among the most actively quoted names in the week ended June 3, according to Markit.
On the bid side, the California taxable 7.5s of 2034 were quoted by 11 unique dealers. On the ask side, the California taxable 7.55s of 2039 were quoted by 13 unique dealers. And among two-sided quotes, the Illinois taxable 5.1s of 2033 were quoted by 15 dealers.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 42,876 trades on Thursday on volume of $12.206 billion.
Primary Market
Traders saw lighter than usual volume during this holiday-shortened week.
The biggest sale of the week came from Pennsylvania, which competitively sold $988 million of unlimited tax general obligation bonds. Citigroup won the Keystone State's GOs with a true interest cost of 2.58%.The deal was well received, according to traders.
The bonds are rated Aa3 by Moody's Investors Service and AA-minus by S&P Global Ratings and Fitch Ratings except for the AGM-insured 2025 and 2034-2036 maturities which are rated Aa3 by Moody's and AA by S&P and AA-minus by Fitch.
The Dormitory Authority of the State of New York came to market with two separate negotiated deals totaling about $832 million for New York University. The bonds will fund various university projects.
Morgan Stanley priced DASNY's $585 million of Series 2016A tax-exempt revenue bonds Wells Fargo Securities priced DASNY's $247 million of Series 2016B taxable revenue bonds. The bonds are rated Aa3 by Moody's and AA-minus by S&P.
Goldman Sachs priced the Illinois Finance Authority's $137 million of Series 2016A revenue refunding bonds for the Northwest Community Hospital. The deal is rated A2 by Moody's and A-plus by S&P.
Bank of America Merrill Lynch priced the Rhode Island Commerce Corp.'s $229 million of R.I. Department of Transportation's Series 2016A grant anticipation refunding bonds. The bonds are rated A2 by Moody's and AA-minus by S&P.
Citigroup priced El Paso, Texas' $251.68 million of general obligation bonds and combination tax revenue certificates of obligation. The deal is rated AA by S&P and Fitch.
Citi also priced the Board of Trustees of Oakland University's $112.82 million of Series 2016 general revenue bonds. The deal is rated A1 by Moody's.
Barclays Capital priced the Sacramento Municipal Utility District's $151.43 million of Series 2016D electric revenue refunding bonds. The deal is rated Aa3 by Moody's and AA-minus by both S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $4.01 billion to $15.97 billion on Friday. The total is comprised of $7.52 billion of competitive sales and $8.45 billion of negotiated deals.
Muni Bond Funds See Inflows for 35th Week in a Row
For the 35th straight week, municipal bond funds reported inflows, according to Lipper data released Thursday.
Weekly reporting funds saw $473.159 million of inflows in the week ended June 1, after inflows of $950.449 million in the previous week, Lipper said.
The four-week moving average remained positive at $970.242 million after being in the green at $1.029 billion 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 also experienced inflows, gaining $291.408 million in the latest week after inflows of $630.989 million in the previous week. Intermediate-term funds had inflows of $104.528 million after inflows of $217.643 million in the prior week.
National funds had inflows of $448.237 million on top of inflows of $916.041 million in the previous week. High-yield muni funds reported inflows of $178.633 million in the latest reporting week, after inflows of $333.190 million the previous week.
Exchange traded funds saw inflows of $92.783 million, after inflows of $110.156 million in the previous week.
