Top-shelf municipal bonds were weaker in early activity, according to traders who were preparing to see a second, even larger, wave of new supply sweep over the market on Wednesday.

Secondary Market

The yield on the 10-year benchmark muni general obligation rose two to four basis points from 2.45% on Tuesday, while the yield on the 30-year increased two to four basis points from 3.16%, according to a read of Municipal Market Data's triple-A scale.

U.S. Treasuries weakened on a stronger-than-expected private payroll report. The ADP Research Institute said private sector employment rose 216,000 in November. Economists surveyed by IFR Markets had expected a gain of 165,000 for the month.

The yield on the two-year Treasury rose to 1.13% from 1.10% on Tuesday, the 10-year Treasury gained to 2.40% from 2.30%, while the yield on the 30-year Treasury bond increased to 3.08% from 2.95%.

On Tuesday, the 10-year muni to Treasury ratio was calculated at 106.5% compared to 103.5% on Monday while the 30-year muni to Treasury ratio stood at 107.2% versus 104.9%, according to MMD.

MSRB: Previous Session's Activity

The Municipal Securities Rulemaking Board reported 55,324 trades on Tuesday on volume of $14.20 billion.

Primary Market

Morgan Stanley is expected to price Chicago's O'Hare International Airport's $1.08 billion of general airport senior lien revenue bonds on Wednesday.

The deal, which is comprised of Series 2016 D, E and F AMT bonds and Series 2016 G non-AMT bonds, is rated A by S&P Global Ratings.

Barclays Capital is set to price the New Jersey Economic Development Authority's $970.7 million deal after it issued a premarketing scale on the bonds on Tuesday and updated it with yields on Wednesday.

The $250 million of Series 2016AAA school facilities construction bonds were premarketed with spreads of about 125 basis points over the interpolated MMD scale in 2018 (5s to yield 2.34%) to 208 basis points over MMD in 2036 (5s to yield 5.10%) and 205 basis points over MMD in 2041 (5s to yield 5.16%).

The $544.29 million of Series 2016BBB school facilities construction refunding bonds were premarketed with spreads of about 180 basis points over the interpolated MMD scale in 2021 (5s to yield 3.58%) to 195 basis points over MMD in 2023 (5s to yield 3.96%) and 210 basis points over MMD in the 2029-2031 maturities (5 1/2s to yield 4.76%, 4.84% and 4.90%, respectively) and 220 basis points over MMD in the second half of a split 2031 maturity (4 3/4s to yield 5%).

The deal is rated A3 by Moody's, BBB-plus by S&P and A-minus by Fitch.

Since 2006, the N.J. EDA has sold roughly $21.4 billion of securities, with the largest issuance occurring in 2008, when it issued $3.22 billion. The EDA has sold over $1 billion in every year since 2006, with the exception of 2009 when it issued $850 million. During that span, the authority has issued over $2 billion a year six times.

Barclays is also set to price the District of Columbia's $577.59 million of general obligation bonds after it issued a premarketing scale on the deal Tuesday and updated it with yields on Wednesday.

The $309.25 million of Series 2016D GOs were premarketed with spreads of about 16 basis points over the interpolated MMD scale in 2019 (3s to yield 1.52%) to 45 basis points over MMD in the 2036 and 2041 maturities (5s to yield 3.47% and 3.56%, respectively). The $187.34 million of Series 2016E GO refunding bonds were premarketed with spreads of about 12 basis points over the interpolated MMD scale in 2018 (5s to yield 1.21%) to 45 basis points over MMD in 2033 (5sto yield 3.37%).

The Washington, D.C., bonds are rated Aa1 by Moody's Investors Service and AA by S&P and Fitch Ratings.

Ramirez & Co. is set to price the New York City Municipal Water Finance Authority's $387.6 million of Fiscal 2017 Series CC water and sewer system second general resolution revenue bonds for institutions after it held a retail order period on Tuesday.

The $300 million of Subseries CC-1 bonds were priced for retail as 5s to yield 3.58% and as 4s to yield 3.95% in a triple-split 2046 maturity. No retail orders were taken in the third tranche.

The $87.6 million of Subseries CC-2 bonds were priced for retail as 5s to yield 2.02% in 2023 and as 5s to yield 2.20% in 2024.

The deal is rated Aa1 by Moody's and AA-plus by S&P and Fitch.

In the competitive arena on Wednesday, Massachusetts is selling $600 million of consolidated loan of 2016 general obligation bonds in three separate offerings.

The deals consist of $300 million of Series J GOs, $150 million of Series I GOs and $150 million of Series H GOs.

All three sales are rated Aa1 by Moody's and AA-plus by S&P and Fitch.

Montgomery County, Md., is competitively selling $436 million of consolidated public improvement general obligation bonds of 2016 consisting of $340 million of Series A GOs and $96 million of Series B refunding GOs.

Both sales are rated triple-A by Moody's, S&P and Fitch.

Bond Buyer Visible Supply

The Bond Buyer's 30-day visible supply calendar decreased $683 million to $17.27 billion on Wednesday. The total is comprised of $4.84 billion of competitive sales and $12.43 billion of negotiated deals.

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