Top-rated municipal bonds finished stronger on Tuesday, according to traders, as the first of the week's new issuance hit the market.

Goldman Sachs priced San Antonio, Texas' $308.94 million of New Series 2017 electric and gas systems revenue and refunding bonds.

The issue was priced as 5s to yield from 0.90% in 2018 to 1.42% in 2021 and from 2.30% in 2026 to 3.21% in 2039. A split 2042 maturity was priced as 5s to yield 3.24% and as 4s to yield 3.59% and a split 2047 maturity was priced as 5s to yield 3.31% and as 4s to yield 3.68%.

The deal is rated Aa1 by Moody's Investors Service, AA by S&P Global Ratings and AA-plus by Fitch Ratings.

Since 2007, San Antonio has sold about $13 billion of bonds, with the most issuance occurring in 2012 when it offered $2.05 billion of debt. The Alamo City saw a low year of issuance in 2011, when it sold $411 million – one of only three times in that period it hasn't sold more than $1 billion in a calendar year.

In the biggest splash of the week, the state of Massachusetts plans to come to market with over $1 billion of bonds in two separate negotiated deals that are heavily packed with green bonds.

On Tuesday, Bank of America Merrill Lynch priced the Massachusetts' Clean Water Trust's $305.02 million of state revolving fund Series 20 green bonds and Series 2017 refunding bonds for retail investors ahead of the institutional pricing on Wednesday.

The $207.78 million of Series 20 green bonds were priced as 5s to yield from 1.20% in 2020 to 2.59% in 2031 and 3.03% in 2042. The 2018 and 2019 maturities were offered as sealed bids. No retail orders were taken in the 2032-2037 or 2042 maturities.

The $97.24 million of refunding bonds were priced as 5s to yield from 1.46% in 2021 to 2.68% in 2029.

The deal is rated triple-A by Moody's, S&P and Fitch.

On Thursday, Citigroup is expected to price the state's $778 million general obligation bond offering. The deal is comprised of $400 million of Series 2017A GO, $278 million of Series 2017C refunding bonds and $100 million of Series 2017B GO green bonds.

That deal is rated Aa1 by Moody's and AA-plus by S&P and Fitch.

Since 2013, U.S. issuers have sold almost $15.5 billion of green bonds, according to ICE Data Services. Most of the issuance occurred in 2016 when over $7.5 billion of green bonds were sold.

ICE said it characterizes bonds as green when they "are issued to fund environmentally beneficial projects such as reducing the impact of, or adapting to, climate change, clean water/drinking water, advance renewable energy, energy efficiency, acquisition of land, preservation and habitat restoration, more efficient and less polluting transportation, and other environmental-related projects."

Citigroup priced the state of Oregon's $328.57 million of Series I, J, and L higher education GOs on Tuesday.

The $125.9 million of Series 2017I bonds were priced to yield from 0.94% with a 3% coupon in 2018 to 3.38% with a 4% coupon in 2037.

The $54.51 million of Series 2017J bonds were priced to yield from 0.90% with a 5% coupon in 2018 to 3.08% with a 5% coupon in 2037; a 2042 maturity was priced as 5s to yield 3.15%.

The $148.17 million of Series 2017L bonds were priced as 5s to yield from 0.90% in 2018 to 3.08% in 2037 and 3.15% in 2042.

The deal is rated Aa1 by Moody's and AA-plus by S&P and Fitch.

JPMorgan Securities priced the Shelby County, Ga., Health, Educational and Housing Facility Board's $146.28 million Series 2017A revenue bonds for Methodist Le Bonheur Healthcare.

The issue was priced to yield from 1.52% with a 5% coupon in 2020 to 3.95% with a 4% coupon in 2037.

The deal is rated A1 by Moody's and AA-minus by S&P.

Secondary Market

The yield on the 10-year benchmark muni general obligation fell one basis point to 2.22% from 2.23% on Monday, while the 30-year GO yield dropped two basis points to 3.01% from 3.03%, according to the final read of Municipal Market Data's triple-A scale.

U.S. Treasuries were narrowly mixed on Tuesday. The yield on the two-year rose to 1.25% from 1.24% on Monday, while the 10-year Treasury yield was unchanged from 2.35%, and the yield on the 30-year Treasury bond increased to 2.99% from 2.98%.

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