Top shelf municipal bonds were stronger at mid-session, traders said, as the last of the week's big new issues came to market.
Secondary Market
The yield on the 10-year benchmark muni general obligation fell two to four basis points from 1.45% on Wednesday, while the yield on the 30-year muni dropped one to three basis points from 2.17%, according to a read of Municipal Market Data's triple-A scale.
Treasuries were stronger on Thursday. The yield on the two-year Treasury dropped to 0.65% from 0.67% on Wednesday, the 10-year Treasury yield declined to 1.50% from 1.55% and the yield on the 30-year Treasury bond decreased to 2.25% from 2.29%.
On Wednesday, the 10-year muni to Treasury ratio was calculated at 94.2% compared to 94.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 94.7% versus 94.9%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,117 trades on Wednesday on volume of $13.77 billion.
Primary Market
The market was seeing its third straight day of chunky new issuance.
Ramirez & Co. priced the Austin Independent School District, Texas' $326.76 million of Series 2016A, B and C unlimited tax refunding bonds.
The $100.56 million of Series 2016A bonds were priced to yield from 0.62% with a 5% coupon in 2018 to 2.58% with a 4% coupon in 2036; a 2017 maturity was offered as a sealed bid.
The $182.03 million of Series 2016B bonds were priced to yield from 0.62% with a 5% coupon in 2018 to 2.58% with a 4% coupon in 2036; a 2017 maturity was offered as a sealed bid.
The $44.18 million of Series 2016C bonds were priced as 5s to yield 1.64% in 2025 and 1.75% in 2026 and to yield from 1.93% with a 5% coupon in 2028 to 2.49% with a 4% coupon in 2033.
The deal, which is backed by the Permanent School Fund guarantee program, is rated triple-A by Moody's Investors Service and Fitch Ratings.
Citigroup priced Guam's $237.92 million of Series 2016A limited obligation Section 30 bonds.
The issue was priced to yield from 0.92% with a 2% coupon in 2016 to 2.94% with a 5% coupon in 2036; a 2046 term bond was prices as 5s to yield 2.98%. The deal is rated BBB-plus by S&P.
Since 2007, Guam has issued $1.74 billion of securities, with the largest issuance coming in 2009 when it sold $474 million. With Thursday's sale, it will be the first time Guam has issued in consecutive years since 2011, when it then came to market for three straight years.
RBC Capital Markets priced Hamilton County, Ohio's $324.04 million of Series 2016A sales tax refunding bonds.
The issue was priced to yield from 0.63% with a 3% coupon in 2017 to 2.58% with a 4% coupon in 2032. The deal is rated A1 by Moody's, AA-minus by S&P and A-plus by Fitch.
Wells Fargo Securities priced the Alaska Housing Finance Corp.'s $100 million of Series 2016A general mortgage revenue bonds II.
The issue as priced at par to yield from 0.45% and 0.50% in a split 2017 maturity to 2.25% and 2.30% in a split 20267 maturity. A 2033 maturity was priced at par to yield 3%, a 2036 maturity was priced at par to yield 3.15%, a 2041 maturity was priced at par to yield 3.25% and a 4046 maturity was prices as 3 1/2s to yield 1.75%. The deal is rated AA-plus by S&P and Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $3.12 billion to $10.41 billion on Thursday. The total is comprised of $3.28 billion of competitive sales and $7.12 billion of negotiated deals.
Tax-Exempt Money Market Fund Outflows
Tax-exempt money market funds experienced outflows of $1.76 billion, bringing total net assets to $184.16 billion in the week ended Aug. 1, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $2.49 million to $185.92 billion in the previous week.
The average, seven-day simple yield for the 271 weekly reporting tax-exempt funds was increased to 0.08% from 0.07% the previous week.
The total net assets of the 890 weekly reporting taxable money funds increased $14.64 billion to $2.534 trillion in the week ended Aug. 2, after an inflow of $17.31 billion to $2.520 trillion the prior before.
The average, seven-day simple yield for the taxable money funds remained at 0.11% from the week before.
Overall, the combined total net assets of the 1,161 weekly reporting money funds increased $12.88 billion to $2.718 trillion in the period ended Aug. 2, which followed an inflow of $14.82 billion to $2.706 trillion.
