Top-quality municipal bonds were stronger at mid-session, according to traders, who were seeing another big wave of issuance sweep over the market.
Secondary Market
The 10-year benchmark muni general obligation yield fell one to three basis points from 2.28% on Tuesday, while the yield on the 30-year GO dropped one to three basis points from 3.06%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were also stronger on Wednesday. The yield on the two-year Treasury declined to 1.15% from 1.17% on Tuesday, while the 10-year Treasury dropped to 2.34% from 2.39%, and the yield on the 30-year Treasury bond decreased to 2.96% from 3.02%.
On Tuesday, the 10-year muni to Treasury ratio was calculated at 95.5% compared to 95.4% on Monday, while the 30-year muni to Treasury ratio stood at 101.4%, versus 101.1%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 43,994 trades on Tuesday on volume of $9.50 billion.
Primary Market
Goldman Sachs priced the Trustees of California State University's $815.31 million of Series 2017A tax-exempt systemwide revenue bonds for institutions on Wednesday after a one-day retail order period.
The deal was priced for institutions to yield from 0.75% with a 3% coupon in 2017 to 3.27% with a 5% coupon in 2038; a split 2042 maturity was priced as 4s to yield 3.63% and as 5s to yield 3.31%; a 2047 maturity was priced as 5s to yield 3.36%.
The deal is rated Aa2 by Moody's Investors Service and AA-minus by S&P Global Ratings.
Citigroup priced the state of Oregon's $418.1 million of tax-exempt general obligation bonds for various purposes.
The $238.93 million of Series 2017A tax-exempt Article XI-Q state project bonds were priced to yield from 1.14% with a 5% coupon in 2019 to 3.11% with a 5% coupon in 2037; a 2042 maturity was priced as 5s to yield 3.16%. A 2018 maturity was offered as a sealed bid.
The $106.17 million of Series 2017C tax-exempt Article XI-M seismic projects bonds were priced to yield from 1.15% with a 5% coupon in 2019 to 3.11% with a 5% coupon in 2037. A 2018 maturity was offered as a sealed bid.
The $24.3 million of Series 2017D tax-exempt Article XI-N seismic projects bonds were priced to yield from 1.15% with a 3% coupon in 2019 to 3.11% with a 5% coupon in 2037. A 2018 maturity was offered as a sealed bid.
The $48.72 million of Series 2017E tax-exempt refunding Article XI-J alternative energy projects bonds were priced to yield from 1.12% with a 2% coupon in 2019 to 2.98% with a 4% coupon in 2031. A 2017 maturity was offered as a sealed bid.
The deal is rated Aa1 by Moody's and AA-plus by S&P and Fitch Ratings.
Citi is also expected to price the Salt Lake Department of Airports' $952 million of airport revenue bonds, consisting of Series 2017A bonds subject to the alternative minimum tax and Series 2017B non-AMT bonds. The deal is rated A2 by Moody's and A-plus by S&P.
In the competitive sector on Wednesday, the Fairfax County Water Authority, Va., sold $198.58 million of Series 2017 water revenue and refunding revenue bonds.
Bank of America Merrill Lynch won the offering with a true interest cost of 3.31%. The issue was priced to yield from 0.90% with a 5% coupon in 2018 to 3.05% with a 5% coupon in 2047. The deal is rated triple-A by Moody's, S&P and Fitch.
The state of Washington competitively sold $103.41 million of Series 2017A state and local agency real and personal property certificates of participation on Wednesday.
BAML won the offering with a true interest cost of 3.24%. The issue was priced as 5s to yield from 1.10% in 2018 to 3.42% in 2038. The deal is rated Aa2 by Moody's.
In the short-term competitive sector, the New York Metropolitan Transportation Authority sold $700 million of notes in two separate sales on Wednesday.
Seven groups won the $500 million of Series 2017 Subseries 2017A-1 transportation revenue bond anticipation notes, including Morgan Stanley, BAML, JPMorgan Securities, Citi, RBC Capital Markets, Barclays Capital and U.S. Bancorp.
Five groups won the $200 million of Series 2017 Subseries 2017B-1 transportation revenue bond anticipation notes, including JPMorgan, TD Securities, Goldman Sachs, BAML and Morgan Stanley.
Pricing information was not immediately available. The BANs are rated MIG1 by Moody's, SP1-plus by S&P and F1 by Fitch.
Since 2007, the N.Y. MTA has sold over $30.78 billion of bonds, with the most issuance occurring in 2012 when it sold $6.69 billion of debt and the least amount taking place in 2007 when it sold $1.27 billion of securities.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $900.9 million to $9.87 billion on Wednesday. The total is comprised of $2.09 billion of competitive sales and $7.78 billion of negotiated deals.
