The week got off to a busy start on Monday as New York City offered $850 million of general obligation bonds to retail buyers while the Metropolitan St. Louis Sewer District, Mo., presented a $317 million refunding deal to retail investors and the Pennsylvania Turnpike’s $260 million bonds priced.
Market participants kept one eye on all the new deals staring to hit the screens and the other on all the latest news coming out of Washington on tax reform.
The MBIS municipal non-callable 5% GO benchmark scale was stronger in late trading.
The 10-year muni benchmark yield fell to 2.337% on Monday from the final read of 2.356% on Friday, according to Municipal Bond Information Services. The MBIS 30-year benchmark muni yield decreased to 2.809% from 2.852%.
The MBIS benchmark index is updated hourly on the Bond Buyer Data Workstation.
Top-rated municipals finished stronger. The yield on the 10-year benchmark muni general obligation fell two basis points to 2.05% on Monday from 2.07% on Friday, while the 30-year GO yield dropped two basis points to 2.66% from 2.68%, according to the final read of MMD’s triple-A scale.
U.S. Treasuries were weaker. The yield on the two-year Treasury rose to 1.81% from 1.77%, the 10-year Treasury yield gained to 2.38% from 2.36% and the yield on the 30-year Treasury increased to 2.77% from 2.76%.
On Monday, the 10-year muni-to-Treasury ratio was calculated at 86.3% compared with 87.6% on Friday, while the 30-year muni-to-Treasury ratio stood at 96.1% versus 97.1%, according to MMD.
Prior week's actively traded issues
Revenue bonds comprised 55.98% of new issuance in the week ended Dec. 1, up from 55.43% in the previous week, according to Markit.
General obligation bonds made up 38.83% of total issuance, down from 39.27%, while taxable bonds accounted for 5.19%, down from 5.30% a week earlier.
This week’s muni supply volume has surged past $17.39 billion, with about $15.5 billion of negotiated deals and $1.9 billion of competitive sales on tap.
Action kicked off Monday as Ramirez & Co. priced NYC’s $850 million of Fiscal 2018 Series C and D GOs on the first day of the retail order period. The GOs will be priced for institutions on Wednesday
The $799.36 million of GOS were priced for retail to yield from 1.60% with 4% and 5% coupons in a split 2019 maturity to 2.98% with a 4% coupon in 2034.
The $50.65 million of Series D GOs were priced to yield from 1.27% with a 2% coupon in 2018 to 3.20% with a 3.125% coupon in 2035.
The deal is rated Aa2 by Moody’s Investors Service and AA by S&P Global Ratings and Fitch Ratings.
Barclays Capital priced the Metropolitan St. Louis Sewer District, Mo.’s $317.77 million of Series 2017A wastewater system improvement and refunding revenue bonds for retail investors.
The issue was priced to yield from 1.49% with a 3% coupon in 2019 to 2.72% with a 5% coupon in 2037; a split half of a 2042 maturity was priced as 5s to yield 2.78%.
No retail orders were taken in the 2020-2031, 2033-2026, a split half of a 2042 or 2047 maturities.
The deal is rated Aa2 by Moody’s, AAA by S&P and AA-plus by Fitch.
Siebert Cisneros Shank priced the Pennsylvania Turnpike Commission’s $308.36 million of turnpike subordinate revenue refunding bonds, third series of 2017 and motor license fund-enhanced turnpike subordinate special revenue refunding bonds, third series of 2017.
The $143.84 million of subordinate revenue refunding bonds were priced to yield from 2.66% with a 5% coupon in 2026 to 3.09% with a 5% coupon in 2032 and to yield from 3.54% with a 4% coupon in in 2036 to 3.59% with a 4% coupon in 2038 and 3.36% with a 5% coupon in 2040.
The $164.52 million of motor license fund-enhanced turnpike subordinate special revenue refunding bonds were priced to yield from 2.67% with a 5% coupon in 2028 to 3.41% with a 4% coupon in 2038; a 2040 maturity was priced as 5s to yield 3.17%.
The subordinate revenue refunding bonds are rated A3 by Moody’s, A-minus by Fitch and A-plus by Kroll Bond Rating Agency while the motor license fund-enhanced turnpike subordinate special revenue refunding bonds are rated A2 by Moody’s and AA-minus by Fitch and Kroll.
JPMorgan Securities priced King County, Wash.’s $151.91 million of Series 2017 sewer refunding revenue bonds.
The issue was priced as 5s to yield from 1.14% and 2.21 in a split 2018 maturity to 2.77% in 2037 and 2.83% in 2042 and 2.91% in 2049.
The deal is rated Aa1 by Moody’s and AA-plus by S&P.
Bond Buyer 30-day visible supply at $22.8B
The Bond Buyer's 30-day visible supply calendar totaled $22.78 billion on Monday, which comprised $5.14 billion of competitive sales and $17.64 billion of negotiated deals.
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 Vanessa Kim at 212-803-8474 for more information.