Top shelf municipal bonds were mostly stronger at midday, according to traders, with a score of new deals coming to market led by issuers in Louisiana, Maryland and Virginia.
Secondary Market
The yield on the 10-year benchmark muni general obligation was much as one basis point weaker from 1.59% on Tuesday, while the 30-year muni yield was much as one basis point weaker from 2.54%, according to a read of the Municipal Market Data's triple-A scale.
U.S. Treasuries were narrowly mixed on Wednesday. The yield on the two-year Treasury increased to 0.76% from 0.75% on Tuesday, while the 10-year Treasury yield slipped to 1.77% from 1.78% and the yield on the 30-year Treasury bond declined to 2.58% from 2.59%.
The 10-year muni to Treasury ratio was calculated at 89.2% on Tuesday compared with 90.4% on Monday, while the 30-year muni to Treasury ratio stood at 97.5% versus 98.3%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 38,538 trades on Tuesday on volume of $9.22 billion.
Primary Market
JPMorgan Securities priced the state of Louisiana’s $283.94 million of Series 2016B general obligation refunding bonds for institutions after a one-day retail order period.
The issue was priced for institutions to yield from 1.65% with 3% and 5% coupons in a split 2022 maturity to 2.51% with a 5% coupon in 2029.
On Tuesday, the issue was priced for retail to yield from 1.56% with 3% and 5% coupons in a split 2022 maturity to 2.43% with a 5% coupon in 2029.
The deal is rated AA by Standard & Poor’s and AA-minus by Fitch Ratings.
Citigroup priced the Maryland Stadium Authority’s $320 million of Series 2016 construction and revitalization program revenue bonds for the Baltimore City public schools.
The issue was priced as 5s to yield from 0.75% in 2018 to 2.61% in 2036; a 2041 term bond was priced as 5s to yield 2.77% while a 2046 term was priced as 5s to yield 2.83%. A 2017 maturity was offered as a sealed bid.
The deal is rated Aa3 by Moody’s Investors Service, AA-minus by S&P and AA by Fitch.
The Stadium Authority is a state corporation that has issued tax-exempt bonds to construct stadiums, arenas and convention centers. In 2013, the state designated the agency as the bond issuing authority for the 21st Century School Buildings Plan, an effort to renovate the city's public school buildings.
The Stadium Authority is not a very frequent issuer. Since 2006, it has sold only about $226 million of bonds, with the largest offering occurring in 2011 when it held a $94.4 million sale. The agency, which has not been in the market since 2012, did not sell any debt in 2008-2010.
Bank of America Merrill Lynch priced Arlington County, Va.’s $217 million of Series 2016A&B GOs.
The $55.2 million of Series 2016A public improvement GOs were priced to yield from 0.69% with a 4% coupon in 2018 to 2.29% with a 5% coupon in 2035. The 2016 and 2017 maturities were offered as sealed bids.
The $162.09 million of Series 2016B refunding GOs were priced to yield from 0.69% with a 5% coupon in 2018 to 2.75% at par in 2032. The 2016 and 2017 maturities were offered as sealed bids.
The deal is rated triple-A by Moody’s S&P and Fitch and carries stable outlooks from all three rating agencies.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $1.46 billion to $11.37 billion on Wednesday. The total is comprised of $4.17 billion of competitive sales and $7.20 billion of negotiated deals.
Evan Fallor contributed to this column
