Prices of top-rated municipal bonds were weaker at mid-session, traders said, as the primary was seeing the last of the week's large deals come to market.
Secondary Market
The yield on the 10-year benchmark muni general obligation was as much as one basis point higher from 1.71% on Wednesday, while the 30-year muni yield was as much as two basis points higher from 2.68%, according to a read of Municipal Market Data's triple-A scale
Treasuries were lower on Thursday. The yield on the two-year Treasury rose to 0.83% from 0.82% on Wednesday, while the 10-year Treasury yield rose to 2.00% from 1.97% and the 30-year Treasury bond yield increased to 2.79% from 2.75%.
The 10-year muni to Treasury ratio was calculated on Wednesday at 86.0% compared to 85.8% on Tuesday, while the 30-year muni to Treasury ratio stood at 97.0% versus 96.1%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,441 trades on Wednesday on volume of $7.97 billion.
Primary Market
Citigroup is set to price the New York Triborough Bridge & Tunnel Authority $480.29 million of Series 2016A MTA bridges and tunnels general revenue bonds for institutions on Thursday after a one-day retail order period on Wednesday.
The issue was priced for retail to yield from 0.70% with 3% and 4% coupons in a split 2017 maturity to 2.48% with a 5% coupon in 2031 and from 2.59% with a 5% coupon in 2033 to 2.74% with a 5% coupon in 2036; a 2041 maturity was priced as 5s to yield 2.92% and a 2046 maturity was priced as 5s to yield 2.98%. A 2016 maturity was offered as a sealed bid.
The bonds were rated Aa3 by Moody's Investors Service and AA-minus by both Standard & Poor's and Fitch Ratings and AA by Kroll Bond Rating Agency.
Since 2006, the TBTA has sold about $8.8 billion of bonds, with the most issuance occurring in 2008 and 2012 when it issued $2.19 billion and $1.79 billion, respectively. The authority has issued bonds roughly three times a year since 2006.
Stifel is expected to price Gwinnet County School District, Ga.'s $330 million of GO sales tax bonds. The issue is rated triple-A by Moody's and S&P.
The Board of Regents of the University of Houston System sold two deals totaling $285 million.
Bank of America Merrill Lynch won the $101.15 million of Series 2016A tax-exempt consolidated revenue and refunding bonds with a true interest cost of 2.81%. Pricing information was not immediately available.
Raymond James won the $183.86 million of Series 2016B taxable consolidated revenue and refunding bonds with a TIC of 3.14%. Pricing information was not immediately available.
Both sales were rated Aa2 by Moody's and AA by S&P.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $1.38 billion to $8.17 billion on Thursday. The total is comprised of $3.10 billion competitive sales and $5.08 billion of negotiated deals.
Tax-Exempt Money Market Funds Post Outflows
Tax-exempt money market funds experienced outflows of $2.12 million, bringing total net assets to $255.00 billion in the week ended Jan. 18, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $416.1 million to $257.12 billion in the previous week.
The average, seven-day simple yield for the 359 weekly reporting tax-exempt funds remained at 0.01% for the 142nd straight week.
The total net assets of the 941 weekly reporting taxable money funds decreased $11.43 billion to $2.492 trillion in the week ended Jan. 19, after an inflow of $11.48 billion to $2.504 trillion the prior week.
The average, seven-day simple yield for the taxable money funds increased to 0.08% from 0.07% in the prior week.
Overall, the combined total net assets of the 1,300 weekly reporting money funds fell $13.56 billion to $2.747 trillion in the period ended Jan. 19, which followed an inflow of $11.90 billion to $2.761 trillion in the prior week.
