Top-rated municipal bonds ended stronger on Thursday, traders said, as North Carolina sold more than $600 million of bonds.

Primary Market
The state of North Carolina competitively sold $618.42 million of Series 2017B limited obligation refunding bonds. Goldman Sachs won the bonds with a true interest cost of 2.23314%. The state last competitively sold comparable bonds on Nov. 5, 2014 when Wells Fargo Securities won $299.02 million of Series 2014C limited obligation refunding bonds with a TIC of 2.53%.

The issue was priced to yield from 0.85% with a 5% coupon in 2018 to 2.91% with a 3% coupon in 2031.

The deal was warmly received by buyers, traders said.

“It was snapped up,” a New York trader said on Thursday, adding that the deal garnered a lot of positive attention. “It’s a good credit and got a good reception today.”

The underwriter and issuer decided to increase the size of the deal from $554.3 milllion.

The deal is rated Aa1 by Moody’s Investors Service and AA-plus by S&P Global Ratings and Fitch Ratings.

Since 2007, the Tar Heel state has issued almost $9 billion of debt, with the most issuance occurring in 2013 when it sold $1.57 billion. It sold the least amount of securities in 2012 when it issued about $180 million of bonds.

In the short-term negotiated sector, Siebert Cisneros Shank priced the Metropolitan District of Hartford County, Conn.’s $120 million of Series B GO bond anticipation notes.

The BANs were priced as 3s to yield 1.60% in 2018.

The deal is rated SP1-plus by S&P.

Secondary market
The yield on the 10-year benchmark muni general obligation fell one basis point to 1.92% from 1.93% on Wednesday, while the 30-year GO yield dropped two basis points to 2.71% from 2.73%, according to the final read of Municipal Market Data's triple-A scale.

Treasuries were mixed on Thursday. The yield on the two-year Treasury rose to 1.36% from 1.35% on Tuesday, the 10-year Treasury yield was flat from 2.26% and the yield on the 30-year Treasury bond was steady from 2.84%.

The 10-year muni to Treasury ratio was calculated at 84.8% on Thursday, compared with 85.1% on Wednesday, while the 30-year muni to Treasury ratio stood at 95.6% versus 95.9%, according to MMD.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 42,349 trades on Wednesday on volume of $13.19 billion.

Tax-exempt money market funds see outflows
Tax-exempt money market funds experienced outflows of $200.5 million, bringing total net assets to $129.98 billion in the week ended July 17, according to The Money Fund Report, a service of iMoneyNet.com.

This outflow followed an inflow of $365.4 million to $130.18 billion in the previous week.

The average, seven-day simple yield for the 231 weekly reporting tax-exempt funds declined to 0.36% from 0.39% in the previous week.

The total net assets of the 852 weekly reporting taxable money funds increased $1.10 billion to $2.469 trillion in the week ended July 11, after an inflow of $1.88 billion to $2.468 trillion the week before.

The average, seven-day simple yield for the taxable money funds was unchanged at 0.63% from the prior week.

Overall, the combined total net assets of the 1,083 weekly reporting money funds increased $896.3 million to $2.599 trillion in the week ended July 11, after inflows of $2.24 billion to $2.598 trillion in the prior week.

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