The action in the primary slowed as the last few remaining deals come trickling in with the week winding down.

"The action is few and far between today, with mostly larger competitive deals, so the market feels sleepy since competitive issuance doesn't get the attention negotiated deals get," said one New York trader. "Yesterday was the big day and now that its over with, people have started to turn their attention to what's coming next week, hoping their luck will be better with allocations from what they got this week."

In the competitive arena, Oyster Bay, N.Y., sold a total of $191.205 million in two separate sales. The $152.665 million of public improvement bonds were won by Bank of America Merrill Lynch with a net interest cost of 3.32%. The $38.54 million of bond anticipation notes were won by BAML with an NIC of 2.28%. The bond deal is rated Baa3 by Moody’s Investors Service and BBB-minus by S&P Global Ratings.

Since 2008, the town of Oyster Bay has sold about $1.21 billion of securities, with the most issuance occurring in 2014 when it sold $380 million. New York’s fourth largest township did not come to market at all in 2012 or 2015.

The Florida Department of Transportation sold $100 million of right-of-way acquisition and bridge construction bonds, won by UBS with a TIC of 3.45%. Since announcing its comeback to the muni market in April 2017, this is the firm's biggest competitive bond sale victory, based on par amount.

Thursday’s bond sales

New York:
Click here for the $153M Oyster Bay deal


Click here for the $39M Oyster Bay BAN deal

Tax-exempt money market funds saw inflows
Tax-exempt money market funds experienced inflows of $2.89 billion, raising their total net assets to $134.61 billion in the week ended May 8, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $981.2 million on to $131.72 billion in the previous week.

The average, seven-day simple yield for the 202 weekly reporting tax-exempt funds fell to 1.11% from 1.22% the previous week.

The total net assets of the 833 weekly reporting taxable money funds grew to $2.68 billion to $2.640 trillion in the week ended May 7, after an inflow of $3.57 billion to $2.637 trillion the week before.

The average, seven-day simple yield for the taxable money funds increased to 1.36% from 1.35% from the prior week.

Overall, the combined total net assets of the 1,035 weekly reporting money funds increased $5.57 billion to $2.775 trillion in the week ended May 7, after inflows of $4.55 billion to $2.769 trillion in the prior week.

Secondary market
Municipal bonds were mostly stronger on Wednesday, according to a midday read of the MBIS benchmark scale.

Benchmark muni yields dropped by no more than one basis point in 25 maturities. The nine- through 13-year maturities all rose by less than a basis point.

The high-grade munis saw 19 maturities decrease by no more than a basis point. The eight- through 13-year and 26- through 30-year maturities were all either flat or increased by less than a basis point.

Municipals were mostly unchanged according to an early read of Municipal Market Data’s AAA benchmark scale, which showed the 10-year and 30-year general obligation muni yields steady. The 2019 through 2024 maturities were lower by as much as a basis point.

On Wednesday, the 10-year muni-to-Treasury ratio was calculated at 81.3% while the 30-year muni-to-Treasury ratio stood at 94.8%, according to MMD.

Previous session's activity
The Municipal Securities Rulemaking Board reported 44,121 trades on Wednesday on volume of $12.696 billion.

California, New York and Texas were the states with the most trades, with the Golden State taking 18.962% of the market, the Empire State taking 12.191% and the Lone Star State taking 9.831%.

Treasury details upcoming auctions
The Treasury Department announced these auctions:

  • $42 billion of 182-day bills selling on May 14;
  • $48 billion of 91-day bills selling on May 14; and
  • $11 billion of nine-year 8-month TIPs selling on May 17.

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.

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