New-issue slate rises to $9B

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The municipal bond market will see lots of new deals to choose from on next week’s large new issue calendar. The supply slate is topped by an almost $2 billion airport deal coming out of Chicago.

Ipreo forecasts weekly bond volume will rise to $9 billion from a revised total of $4.5 billion in the prior week, according to updated data from Thomson Reuters. The calendar is composed of $8 billion of negotiated deals and $989.6 million of competitive sales.

Primary market
JPMorgan Securities is expected to price Chicago’s $1.848 billion of general airport senior lien revenue and refunding bonds on Tuesday.

The deal is equally divided into a Series 2018B tax-exempt series of senior lien general airport revenue bonds not subject to the alternative minimum tax, a Series 2018A tax-exempt GARB series subject to the AMT, and a Series 2018C taxable GARB series.

Frasca & Associates and Swap Financial Group are financial advisors while Mayer Brown and Neal & Leroy are bond counsel.

Ahead of the sale, S&P Global Ratings and Fitch Ratings affirmed their A ratings for O’Hare while Kroll Bond Rating Agency affirmed its A-plus rating. All three assign a stable outlook.

Also on tap, Bank of America Merrill Lynch is set to price the Delaware River Port Authority, Pa.’s $714 million of tax-exempt Series 2018A revenue refunding bonds and Series 2018B taxable revenue bonds on Thursday.

The deal is rated A2 by Moody’s Investors Service and A-plus by S&P.

In the short-term sector, Morgan Stanley is expected to price Nassau County, N.Y.’s $578 million of notes on Wednesday.

The issue is composed of Series 2018A tax anticipation notes, Series 2018B tax anticipation notes, Series 2018A revenue anticipation notes, Series 2018B bond anticipation notes and Series 2018C bond anticipation notes.

The deal is rated SP1 by S&P and F1 by Fitch.

In the competitive arena, the Washington Suburban Sanitary District, Md., is selling $390 million of consolidated public improvement bonds of 2018. Proceeds will be used to finance various water and sewer improvements. The financial advisor is Wye River Group and the bond counsel is McKennon Shelton.

The deal is rated AAA by Fitch Ratings.

Bond Buyer 30-day visible supply at $12.13B
The Bond Buyer's 30-day visible supply calendar increased $5.58 billion to $12.13 billion for Friday. The total is comprised of $1.72 billion of competitive sales and $10.40 billion of negotiated deals.

Lipper: Muni bond funds saw outflows
Investors in municipal bond funds again pulled cash out of the funds during the latest reporting week, according to Lipper data released on Thursday.

The weekly reporters saw $378.623 million of outflows in the week ended Nov. 28 after outflows of $332.241 million in the previous week.
Exchange traded funds reported inflows of $34.818 million, after inflows of $447.558 million in the previous week. Ex-ETFs, muni funds saw outflows of $413.442 million after outflows of $779.798 million in the previous week.

The four-week moving average remained negative at -$274.449 million, after being in the red at -$509.960 million in the previous week. A moving average is an analytical tool used to smooth out price changes by filtering out fluctuations.

Long-term muni bond funds had outflows of $315.870 million in the latest week after outflows of $63.643 million in the previous week. Intermediate-term funds had outflows of $183.646 million after outflows of $98.176 million in the prior week.

National funds had outflows of $275.862 million after outflows of $156.485 million in the previous week. High-yield muni funds reported outflows of $85.331 million in the latest week, after outflows of $227.862 million the previous week.

Secondary market
Municipal bonds were stronger on Friday, according to a midday read of the MBIS benchmark scale. Benchmark muni yields dipped as much as four basis points in the one- to 30-year maturities.

High-grade munis were stronger, with yields calculated on MBIS' AAA scale decreasing as much as three basis points across the curve.

Municipals were stronger on Municipal Market Data’s AAA benchmark scale, which showed the yield on the 10-year muni general obligation falling one to three basis point while the yield on 30-year muni maturity dropped as much as two basis points.

Treasury bonds were stronger as stocks traded mixed. The Treasury 10-year stood at 3.014% while the Treasury 3-month bill was at 2.373%.

On Thursday, the 10-year muni-to-Treasury ratio was calculated at 83.8% while the 30-year muni-to-Treasury ratio stood at 97.6%, according to MMD. The muni-to-Treasury ratio compares the yield of tax-exempt municipal bonds with the yield of taxable U.S. Treasury with comparable maturities. If the muni/Treasury ratio is above 100%, munis are yielding more than Treasury; if it is below 100%, munis are yielding less.

Previous session's activity
The Municipal Securities Rulemaking Board reported 50,434 trades on Thursday on volume of $13.73billion.

California, New York and Texas were the municipalities with the most trades, with the Golden State taking 18.336% of the market, the Empire State taking 12.993% and the Lone Star State taking 9.99%.

Week's actively traded issues
Some of the most actively traded munis by type in the week ended Nov. 30 were from New Jersey, California and Puerto Rico issuers, according to Markit.

In the GO bond sector, the Passaic County, N.J., 3s of 2019 traded 21 times. In the revenue bond sector, California’s Golden State Tobacco Securitization Corp. 5s of 2047 traded 37 times. And in the taxable bond sector, the Puerto Rico Government Development Bank 5s of 2023 traded 17 times.

Week's actively quoted issues
Illinois, New York and California names were among the most actively quoted bonds in the week ended Nov. 30, according to Markit.

On the bid side, the Illinois taxable 5.1s of 2033 were quoted by 40 unique dealers. On the ask side, the New York Metropolitan Transportation Authority revenue 5s of 2025 were quoted by 290 dealers. And among two-sided quotes, the California taxable 7.3s of 2039 were quoted by 23 dealers.

ICI: Long-term muni funds saw $578M outflow
Long-term tax-exempt municipal bond funds saw an outflow of $578 million in the week ended Nov. 20, the Investment Company Institute reported Wednesday.

This followed an outflow of $770 million in the week ended Nov. 14 and outflows of $909 million, $1.196 billion, $179 million, $1.310 billion, and $1.653 billion in the previous five weeks.
Taxable bond funds saw an estimated outflow of $3.220 billion in the latest reporting week, after seeing an outflow of $1.543 billion in the previous week and an inflow of $1.703 billion in the week ended Nov. 7.

ICI said the total estimated outflows to long-term mutual funds and exchange-traded funds were $6.693 billion after outflows of $34 million in the prior week and $2.324 billion in the week ended Nov. 7.

Data appearing in this article from Municipal Bond Information Services, including the MBIS municipal bond index, is available on The Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Ziad Saba at 212-803-6079 for more information.

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Primary bond market Secondary bond market Municipal bond funds City of Chicago, IL O'Hare Airport Delaware River Port Authority County of Nassau, NY State of California State of New York State of Texas Government Development Bank for Puerto Rico Metropolitan Transportation Authority State of Illinois Golden State Tobacco Securitization Corporation