Top-quality municipal bonds were mixed at mid-session, according to traders, who were seeing the last of the week's big issues hit the market as large deals from the New York Metropolitan Transportation Authority and the Los Angeles Department of Water and Power were priced on Thursday.
Secondary Market
The 10-year benchmark muni general obligation yield rose as much as one basis point from 2.46% on Wednesday, while the yield on the 30-year GO was flat from 3.23%, according to a read of Municipal Market Data's triple-A scale.
U.S. Treasuries were weaker on Thursday. The yield on the two-year Treasury rose to 1.36% from 1.35% on Wednesday, while the 10-year Treasury yield gained to 2.58% from 2.55%, and the yield on the 30-year Treasury bond increased to 3.17% from 3.14%.
On Wednesday, the 10-year muni to Treasury ratio was calculated at 96.4% compared to 96.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 102.7%, versus 102.5%, according to MMD.
MSRB: Previous Session's Activity
The Municipal Securities Rulemaking Board reported 47,751 trades on Wednesday on volume of $15.13 billion.
Primary Market
Jefferies priced the New York Metropolitan Transportation Authority's $325.56 million of transportation revenue green bonds for institutions on Thursday after holding a one-day retail order period.
The $188.92 million of Subseries 2017A-1 climate bond certified transportation revenue green bonds were priced to yield from 1.25% with a 3% coupon in 2019 to 3.63% with a 5% coupon in 2037; a 2043 maturity was priced as 4s to yield 4.03%, a split 2047 maturity was priced as 4s to yield 4.08% and as 5s to yield 3.71%; a 2052 maturity was priced as 5s to yield 3.90% and a 2057 maturity was priced as 5 1/4s to yield 4%. The 2017 and 2018 maturities were offered as sealed bids.
The $136.64 million of Subseries 2017A-2 climate bond certified transportation revenue refunding green bonds were priced as 5s to yield from 2.51% in 2024 to 3.23% in 2030.
The deal is rated A1 by Moody's Investors Service, AA-minus by S&P Global Ratings, A by Fitch Ratings and AA-plus by Kroll Bond Rating Agency.
Citigroup priced the city of Los Angeles Department of Water and Power's $344.575 million of Series 2017B power system revenue bonds on Thursday.
The bonds were priced to yield 1.26% with a 5% coupon in 2020 and from 2.16% with a 5% coupon in 2024 to 3.38% with a 5% coupon and 3.28% with a 5.25% coupon in a split 2039 maturity.
The deal is rated Aa2 by Moody's and AA-minus by S&P and Fitch.
Since 2007, the Los Angeles DWP has sold about $12.94 billion of bonds, with the most issuance coming in 2010 when it offered $2.06 billion. The department has issued at least $1 billion of bonds in six of the past seven years.
RBC Capital Markets priced the Coast Community College District in Orange County, Calif.'s Election of 2012 $280 million of Series 2017D tax-exempt general obligation bonds and $20 million of Series 2017E taxable GOs.
The tax-exempts were priced to yield from 1.04% with a 4% coupon in 2019 to 3.34% with a 5% coupon in 2037; a 2039 maturity was priced as 4 1/2s to yield 3.56% and a 2042 maturity was priced as 4s to yield 3.84%.
The taxables were priced at par to yield 1.425% in 2018 and 1.693% in 2019. The deal is rated Aa1 by Moody's and AA-plus by S&P.
RBC priced the Texas Public Finance Authority's $141.52 million of Series 2017A GO refunding bonds.
The bonds were priced to yield from 0.91% with a 3% coupon in 2018 to 3.67% with a 4% coupon in 2035. The 2017 maturity was offered as a sealed bid. The deal is rated triple-A by Moody's and S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $2.33 billion to $9.46 billion on Thursday. The total is comprised of $2.97 billion of competitive sales and $6.49 billion of negotiated deals.
Tax-Exempt Money Market Fund Inflows
Tax-exempt money market funds experienced inflows of $560.5 million, bringing total net assets to $130.99 billion in the week ended March 6, according to The Money Fund Report, a service of iMoneyNet.com. This followed an outflow of $1.19 billion to $130.43 billion in the previous week.
The average, seven-day simple yield for the 232 weekly reporting tax-exempt funds decreased to 0.20% from 0.21% in the previous week.
The total net assets of the 859 weekly reporting taxable money funds increased $5.37 billion to $2.526 trillion in the week ended March 7, after an inflow of $13.38 billion to $2.521 trillion the week before.
The average, seven-day simple yield for the taxable money funds was unchanged from 0.27% in the prior week.
Overall, the combined total net assets of the 1,091 weekly reporting money funds rose $5.93 billion to $2.657 trillion in the week ended March 7, after inflows of $12.19 billion to $2.651 trillion in the prior week.
