Top-rated municipal bonds were stronger in early activity on Wednesday, according to traders, as yields on most maturities weakened from two to four basis points.
In the primary, the market is set for some of the week's biggest deals.
Secondary Market
The yield on the 10-year benchmark muni general obligation was two to four basis points weaker from 1.75% on Tuesday, while the 30-year muni yield two to four basis points weaker from 2.70%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were higher on Wednesday. The yield on the two-year Treasury fell to 0.83% from 0.85% on Tuesday, while the 10-year Treasury yield dropped to 1.99% from 2.02% and the 30-year Treasury bond yield decreased to 2.75% from 2.79%.
Prices of top-rated munis were steady on Tuesday. The yield on the 10-year benchmark muni general obligation was unchanged from 1.75% on Friday, while the 30-year muni yield was flat from 2.70%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Tuesday at 85.8% compared to 86.4% on Friday, while the 30-year muni to Treasury ratio stood at 96.1% versus 96.2%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 34,098 trades on Tuesday on volume of $5.08 billion.
Primary Market
The largest deals of the week are coming on Wednesday, with Washington state offering two competitive sales totaling $673 million.
The Evergreen State will sell $529.36 million of Series R-2016B various purpose general obligation refunding bonds and $143.65 million of Series R-2016C motor vehicle tax GO refunding bonds. Both series are rated Aa1 by Moody's and AA-plus by Standard & Poor's and Fitch.
Also in the competitive arena, the University of Kentucky will offer sales totaling $158.11 million on Wednesday. The issues consist of $109.26 million of Series 2016A general receipts bonds and $48.85 million of Series 2016B taxable general receipts bonds. Both series are rated Aa2 by Moody's and AA by S&P.
Additionally on Wednesday, the Rosemount-Apple Valley Independent School District No. 196, Minn., will sell $121.30 million Series 2016A GO school building bonds under the Minnesota School District enhancement program. The issue is rated Aa1 by Moody's and AA-plus by S&P.
Loop Capital Markets is expected to price the District of Columbia Water and Sewer Authority's $372.25 million of public utility subordinate lien revenue refunding bonds on Wednesday. The issue is rated Aa3 by Moody's, AA by S&P and AA-minus by Fitch.
Citigroup is scheduled to price the New York Triborough Bridge & Tunnel Authority $300 million of MTA bridges and tunnels general revenue bonds for retail on Wednesday ahead of the institutional pricing on Thursday. The transaction is rated Aa3 by Moody's and AA-minus by both S&P and Fitch.
Wells Fargo Securities is expected to price the Aldine Independent School District, Texas' $265.46 million of unlimited tax school building and refunding bonds on Wednesday. The issue is backed by the Permanent School Fund guarantee program and has underlying ratings of Aa1 from Moody's and AA from S&P.
Morgan Stanley is set to price the Massachusetts Development Finance Agency's $176.47 million of Series 2016 revenue bonds for the UMass Memorial Health Care Obligated Group on Wednesday.
On Thursday, the Board of Regents for the University of Houston will offer two deals totaling $285 million. The BOR will sell $101.15 million of Series 2016A tax-exempt consolidated revenue and refunding bonds and $183.86 million of Series 2016B taxable consolidated revenue and refunding bonds. The bonds are rated Aa2 by Moody's and AA by S&P.
Stifel is slated to price Gwinnet County School District, Ga.'s $330 million of GO sales tax bonds on Thursday. The issue is rated triple-A by Moody's and S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar rose $2.6 million to $9.55 billion on Wednesday. The total is comprised of $4.12 billion competitive sales and $5.43 billion of negotiated deals.
