Top-rated municipal bonds were slightly stronger at mid-session, according to traders, as the first big deals of the week came to market.
Secondary Market
The 10-year benchmark muni general obligation yield was as much as one basis point lower from 2.23% on Monday, while the yield on the 30-year GO dropped as much as one basis point from 2.98%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were narrowly mixed on Tuesday. The yield on the two-year Treasury dipped to 1.18% from 1.19% on Monday, while the 10-year Treasury yield was flat from 2.37%, and the yield on the 30-year Treasury bond was unchanged from 2.97%.
On Monday, the 10-year muni to Treasury ratio was calculated at 93.9% compared with 92.6% on Friday, while the 30-year muni to Treasury ratio stood at 100.4%, versus 99.8%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,988 trades on Monday on volume of $8.05 billion.
MSRB Adds New Issue Calendar to EMMA
The MSRB added a new issue calendar (http://emma.msrb.org/ToolsandResources/NewIssueCalendar) for municipal bonds to its EMMA website on Monday. The calendar lists bonds that are scheduled for sale as well as details on issues that recently priced.
"Investors interested in gaining access to municipal bonds in the primary market can use the calendar to research upcoming offerings," MSRB Executive Director Lynnette Kelly said in a press release. "They can contact a municipal securities dealer if they are interested in a particular offering."
The calendar can also help those state and local governments which are considering issuing munis.
"Municipal entities can use the calendar to inform timing on new bond issues, as well as to identify and compare prices of other recently sold bonds," Kelly said. The tool lets users filter upcoming bond issues by state, tax status and whether the issue is bank qualified.
After the official award, the deal is displayed on the calendar in a separate recently sold tab. Those bond listings contain a final pricing scale with coupons and maturities along with ratings.
"This dynamic tool, along with the other data and disclosures available on EMMA, can help all municipal market participants make decisions that are right for them," Kelly said.
Primary Market
Market action got underway with the offering of several large deals.
In the competitive arena, Washington state sold about $626 million of bonds in three separate offerings on Tuesday.
Wells Fargo Securities won the $437.42 million of Series 2017D various purpose general obligation bonds with a true interest cost of 3.51%. The issue was priced as 5s to yield from 1.03% in 2018 to 3.13% in 2042.
Citigroup won the $139.02 million of Series R-2017C various purpose GO refunding bonds with a TIC of 1.92%. Pricing information was not immediately available.
Bank of America Merrill Lynch won the $49.97 million of Series 2017E motor vehicle fuel tax GOs and Series R-2017D motor vehicle fuel tax refunding GOs with a TIC of 3.14%. The $25.2 million of Series 2017E GOs were priced as 5s to yield from 1% in 2018 to 3.21% in 2042. The $24.77 million of Series R-2017 refunding GOs were priced as 5s to yield from 0.90% in 2017 to 2.28% in 2025.
All three deals are rated Aa1 by Moody's Investors Service and AA-plus by S&P Global Ratings and Fitch Ratings.
Since 2007, the Evergreen State has issued about $30 billion of debt, with the largest issuance occurring in 2012 when it sold $3.5 billion of debt. The state sold the least amount of bonds in the past 10 years in 2008, when it offered $1.8 billion of bonds.
The Alpine School District Board of Education, Utah, competitively sold $150.43 million of Series 2017 GO school building and refunding bonds under the Utah school bond guaranty program.
Citi won the bonds with a TIC of 2.61%. Pricing information was not immediately available. The deal is rated triple-A by Moody's and Fitch.
Hennepin County, Minn., is competitively selling $119.98 million of Series 2017A first lien sales tax revenue refunding bonds.
BAML won the bonds with a TIC of 2.80%. Pricing information was not immediately available. The deal is rated triple-A by S&P and Fitch.
In the negotiated arena, Citigroup is set to price the Board of Regents of the Texas A&M University System's $389 million of Series 2017A taxable revenue financing system bonds on Tuesday. The deal is rated triple-A by Moody's, S&P and Fitch.
Goldman Sachs is expected to price the Trinity Health Credit Group's $333.87 million composite bond on Tuesday, from conduit issuers in states with Trinity facilities. The deal is being sold through the Michigan Finance Authority, the Maryland Health and Higher Educational Facilities Authority, the Idaho Health Facilities Authority, and Franklin County, Ohio. The offering is rated Aa3 by Moody's and AA-minus by S&P and Fitch.
Loop Capital Markets is set to price the Chicago Transit Authority's $293.47 million of Series 2017 second lien sales tax receipts revenue bonds on Tuesday. The deal is rated A-plus by S&P and AA-minus by Kroll Bond Rating Agency.
RBC Capital Markets is expected to price the Pennsylvania Housing Finance Agency's $239.65 million of Series 2017-122 single-family mortgage revenue bonds, not subject to the alternative minimum tax, on Tuesday. The deal is rated Aa2 by Moody's and AA-plus by S&P.
RBC is also expected to price the Aurora Public Schools, Joint School District No. 28J in Adams and Arapahoe Counties, Colo., Series 2017A GOs and Series 2017B GOs. The deal, backed by the Colorado state intercept program, is rated Aa2 by Moody's and AA by Fitch.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar increased $1.06 billion to $18.01 billion on Tuesday. The total is comprised of $4.32 billion of competitive sales and $13.68 billion of negotiated deals.
