The municipal bond market is preparing for start of the new issue calendar on Tuesday, which is headlined by sales from New Jersey and California. Traders will also be looking at muni yields, which have been buffeted by volatility surrounding the turmoil in the equities market.
Primary Market
Bank of America Merrill Lynch is slated to price three series of bonds for the New Jersey Economic Development Authority totaling $2.2 billion for institutions on Tuesday.
The bonds had a two-day retail order period and BAML priced the authority's $1.658 billion of school facilities construction bonds and refunding bonds, Series WW and XX for retail on Friday and repriced it on Monday.
The $500 million of Series 2015 WW school facilities construction bonds were repriced to yield from 4.66% with a 4.625% coupon in 2028 and as 5s to yield from 4.98% in 2033 to 5.11% in 2037. The 2029-2032 maturities and a term bond in 2040 were not offered for retail.
The $1.16 billion of Series 2015 XX school facilities construction refunding bonds were repriced to yield from 3.53% with a 3.25% coupon and 5% coupon in a split 2020 maturity to 4.36% with a 5% coupon in 2025. The 2026 and 2027 maturities were not offered for retail.
A sale of $574 million of Series 2015YY taxable school facilities construction refunding bonds is also scheduled.
The bonds were rated A3 by Moody's Investors Service and A-minus by Standard and Poor's and Fitch Ratings.
Since 1995, the New Jersey EDA has issued roughly $41.65 billion of debt. The years of 2004 and 2005 saw the most issuance with $4.54 billion and $4.11 billion, respectively. The authority had low issuance years in 1995 and 2005, when they issued just $445 million and $414 million, respectively.
In the competitive arena, the Cobb-Marietta Coliseum and Exhibit Hall Authority, Ga., will auction $372.55 million of Series 2015 taxable revenue bonds to finance the Atlanta Braves' new stadium.
The fixed-rate, 30-year bonds are being issued by the Cobb-Marietta Coliseum & Exhibit Hall Authority through an interlocal agreement with the county. Bond proceeds will be used as the county's contribution to a $672 million 41,500-seat Major League Baseball stadium.
The deal was rated triple-A by Moody's, S&P and Fitch.
"We expect strong bids as a result of the triple triple-A ratings based upon the county's full faith and credit pledge to the intergovernmental contract securing the bonds," financial advisor Dianne McNabb, a director at Public Financial Management, told The Bond Buyer on Friday.
Morgan Stanley is set to price the state of California's $1.9 billion of various purpose general obligation and GO refunding bonds for retail ahead of the institutional pricing on Wednesday.
About $1.35 billion from the sale will be used to refinance existing debt with the remaining amount providing permanent financing for capital facilities or other voter-approved projects and public facilities.
The deal was rated Aa3 by Moody's, AA-minus by S&P and A-plus by Fitch.
Secondary Market
Treasury prices were lower on Tuesday, with the yield on the two-year Treasury note rising to 0.60% from 0.56% on Monday, while the 10-year yield rose to 2.06% from 2.02% and the 30-year yield increased to 2.78% from 2.75%.
The yield on the 10-year benchmark muni general obligation on Monday finished four basis points weaker at 2.09% from 2.13% on Friday, while the yield on the 30-year GO was unchanged at 3.00%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Monday at 104.7% versus 103.9% on Friday, while the 30-year muni to Treasury ratio stood at 110.4% compared to 109.3%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 31,208 trades on Monday on volume of $5.363 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar decreased $28.3 million to $12.12 billion on Tuesday. The total is comprised of $3.03 billion competitive sales and $9.09 billion of negotiated deals.
Shelly Sigo contributed to this report.
