The municipal market finished slightly weaker yesterday, partially reflecting a softness in Treasuries. Traders said tax-exempt yields were higher by one or two basis points."It's actually a little bit weaker right now," a trader in New York said. "We've had some strength in the market for a while, but we're doing a bit of an about-face. It's still fairly quiet, but I'd say we're definitely cheaper by a basis point or two."

"Treasuries have been weakening the past couple days, and I think it's finally weighing on the muni market a little bit," a trader in Los Angeles said. "We're just a little bit weaker today, not more than a basis point or two. But there's none of that firmness we'd been feeling recently. It's definitely weaker today."

The Treasury market showed some losses yesterday. The yield on the benchmark 10-year note, which opened at 3.47%, was quoted near the end of the session at 3.63%. The yield on the two-year note finished at 1.03%, after opening at 0.94%. And the yield on the 30-year bond, which opened at 4.37%, finished at 4.51%.

As of Tuesday's close, the triple-A muni scale in 10 years was at 85.3% of comparable Treasuries, according to Municipal Market Data. Additionally, 30-year munis were 104.3% of comparable Treasuries. Also, as of the close, 30-year tax-exempt triple-A general obligation bonds were at 110.9% of the comparable London Interbank Offered Rate.

In the new-issue market yesterday, JPMorgan priced for retail investors bonds from a $477.5 million revenue transaction for Sacramento County. Bonds from the $31 million Series A mature in 2041. These bonds, which are callable at par in 2018, were not offered during the retail order period.

Bonds from the $169.8 million Series B mature from 2012 through 2029, with term bonds in 2034 and 2039. Yields range from 2.52% with a 3% coupon in 2012 to 5.57% with a 5.5% coupon in 2034. Bonds maturing in 2039 were not offered during the retail order period. Bonds maturing from 2020 through 2024 are insured by Assured Guaranty Corp., while all remaining bonds are uninsured. The bonds are callable at par in 2018.

Bonds from the $111.8 million Series C mature in 2039 and 2041, are callable at par in 2018, and were not offered during the retail order period.

Bonds from the $164.9 million Series D mature from 2010 through 2029, with a term bond in 2035. Yields range from 2.55% with a 5% coupon in 2011 to 6.10% with a 6% coupon in 2035. Bonds maturing in 2010 were decided via sealed bid. These bonds are callable at par in 2018. Bonds maturing from 2016 through 2029 are insured by Assured Guaranty. All other bonds are uninsured. The underlying credit is rated A3 by Moody's Investors Service and A by Standard & Poor's.

JPMorgan also priced $251.8 million of taxable system facilities revenue bonds for the Curators of the University of Missouri. The bonds mature in 2039, and are rated Aa2 by Moody's and AA by Standard & Poor's.

Additionally, JPMorgan priced $140 million of revenue bonds for the Dormitory Authority of the State of New York. The bonds mature from 2016 through 2029, with term bonds in 2034 and 2038. Yields range from 3.08% with a 3.5% coupon in 2016 to 5.18% with a 5% coupon in 2038. The bonds, which are callable at par in 2019, are rated Aa3 by Moody's and AA by Standard & Poor's.

Wells Fargo Securities priced $89.7 million of hospital revenue bonds for the Colorado Health Facilities Authority in two series. Bonds from the $37.6 million Series A mature from 2010 through 2020, with term bonds in 2026 and 2030. Yields range from 2.13% with a 5% coupon in 2010 to 5.66% with a 5.5% coupon in 2030. The bonds are callable at par in 2019.

Bonds from the $52.1 million Series B mature from 2011 through 2019, with term bonds in 2026 and 2030. Yields range from 2.50% with a 4% coupon in 2011 to 5.66% with a 5.5% coupon in 2030. The bonds are also callable at par in 2019. The bonds are insured by Financial Security Assurance Inc. The underlying credit is rated A-plus by Standard & Poor's and A-plus by Fitch Ratings.

In economic data released yesterday, the consumer price index rose 0.7% in June, after a 0.1% climb the previous month. Economists polled by Thomson Reuters had predicted a 0.6% increase. The core CPI climbed 0.2% in June, after a 0.1% rise the previous month. Economists polled by Thomson had predicted a 0.1% increase.

Industrial production in the nation was down 0.4% in June while capacity utilization fell to 68.0. The drop in production levels followed a 1.2% decrease the previous month, while May capacity use was revised down to 68.2. Thomson Reuters had forecast a 0.6% decrease for production, and a 67.9% level for capacity utilization.

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