The municipal market was largely unchanged yesterday.

"There was definitely weakness in the market for much of the day, but at the end, we've sort of drifted back to unchanged," a trader in Los Angeles said. "Treasuries were off early on, and so were we, but they eventually drifted back, and after they did, we eventually did too."

The Treasury market showed little movement yesterday. The yield on the benchmark 10-year Treasury note, which opened at 4.03%, finished at 4.04%. The yield on the two-year note was quoted near the end of the session at 2.61% after opening at 2.62%. The yield on the 30-year Treasury finished at 4.64% after opening at 4.62%.

In the new-issue market yesterday, Morgan Stanley priced $1.9 billion of taxable sales and transfer tax receipts revenue bonds for the Chicago Transit Authority, in two series. Bonds from the $1.3 billion Series A and from the $640 million Series B mature in 2013, 2021, and 2040. In both Series the 2013 maturity was priced at par to yield 5.118%, the 2021 maturity was price at par to yield 6.30% and the 2040 maturity was priced at par to yield 6.899%. The credit is rated Aa3 by Moody's Investors Service and AA-plus by Standard & Poor's.

JPMorgan priced for retail investors $385.3 million of capital fund modernization program subordinate bonds for the Puerto Rico Housing Finance Authority. The bonds mature from 2008 through 2027, with yields ranging from 2.00% with a 3.5% coupon in 2009 to 5.00% priced at par in 2027. Bonds maturing in 2008 will be decided via sealed bid. Bonds maturing from 2019 through 2022, and from 2024 through 2026, were not offered during the retail order period. The bonds, which are callable at par in 2018, are rated AA-minus by Standard & Poor's and A-plus by Fitch Ratings.

Citi priced $343.6 million of taxable pension obligation bonds for San Diego. The bonds mature from 2009 through 2018, with a term bond in 2026. The credit is rated Aa3 by Moody's, and AA by both Standard & Poor's and Fitch.

Citi also priced $250 million of refunding revenue bonds for California's Imperial Irrigation District Electric System. The bonds mature from 2008 through 2025, with term bonds in 2028, 2033, and 2038. Yields range from 2.41% with a 4% coupon in 2010 to 5.33% with a 5.125% coupon in 2038. The bonds, which are callable at par in 2018, are rated Aa3 by Moody's, A-plus by Standard & Poor's, and AA-minus by Fitch.

Lehman Brothers priced $209 million of revenue financing system revenue bonds for the Texas State University System Board of Regents. The bonds mature from 2008 through 2028, with yields ranging from 2.43% with a 5% coupon in 2010 to 5.00% priced at par in 2028. Bonds maturing in 2008 and 2009 will be decided via sealed bid. The bonds, which are callable at par in 2018, are rated Aa3 by Moody's and AA-minus by Standard & Poor's.

First Southwest Co. priced $188.9 million of unlimited tax schoolhouse and refunding bonds for Texas' Klein Independent School District. The bonds mature from 2009 through 2028, with term bonds in 2033 and 2038. Yields range from 2.35% with a 5% coupon in 2010 to 5.05% with a 5% coupon in 2038. The bonds, which are callable at par in 2018, are backed by the state's triple-A Permanent School Fund guarantee program. The underlying credit is rated Aa2 by Moody's and AA by Standard & Poor's.

Morgan Stanley priced $181.3 million of clean-water state revolving fund bonds for the Virginia Resources Authority. The bonds mature from 2011 through 2031, with yields ranging from 2.70% with a 3% coupon in 2011 to 4.82% with a 4.75% coupon in 2031. The bonds, which are callable at par in 2018, are rated triple-A by all three major ratings agencies.

Banc of America Securities LLC priced $67 million of solid waste disposal revenue bonds for Texas' Mission Economic Development Corp. The bonds, which are subject to the alternative minimum tax, mature in 2020, yielding 6.00%, priced at par. The bonds are rated BBB by Standard & Poor's.

Clark County, Nev., competitively sold $50.6 million of general obligation limited tax flood control refunding bonds to Depfa First Albany Securities LLC, with a true interest cost of 3.53%. The bonds mature in 2008, and from 2009 through 2015, with yields ranging from 2.00% with a 3% coupon in 2008 to 3.69% with a 5% coupon in 2015. The bonds, which are not callable, are rated Aa1 by Moody's and AA-plus by Standard & Poor's.

Goldman, Sachs & Co priced a $45 million South Carolina State Housing Finance and Development Authority mortgage revenue bond deal for retail investors ahead of institutional pricing today.

Lehman Brothers priced $40.7 million of revenue refunding bonds for the Philadelphia Authority for Industrial Development. The bonds mature from 2009 through 2024, with term bonds in 2026, 2028, and 2037. Yields range from 1.90% with a 4% coupon in 2009 to 5.18% with a 5% coupon in 2037. The bonds, which are callable at par in 2018, are rated Aa3 by Moody's and AA-minus by Standard & Poor's.

The economic calendar was light yesterday. However, a slate of economic data will be released today and tomorrow. Today, second-quarter gross domestic product data will be released, along with the second quarter core PCE price index, initial jobless claims for the week of July 26, continuing jobless claims for the week of July 19, and the Chicago purchasing managers index. Tomorrow, July non-farm payroll data highlight the day, including July unemployment data and average hourly earnings, while June construction spending and the July Institute for Supply Management business activity composite index will also be released.

Economists polled by IFR Markets are predicting a 72,000 decline in non-farm payrolls. They are also forecasting a 2.4% annual growth rate for GDP, 398,000 initial jobless claims, 3.150 million continuing jobless claims, a 49.0 Chicago PMI reading, a 0.4% dip in construction spending, a 49.2 reading in the ISM index, and an unemployment rate of 5.6%.

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