The municipal market saw the last two notable deals price, as the market was stronger by as many as five basis points.
Thursday morning opened with bonds due in 10 years and beyond four to five basis points stronger, according to a New York City trader. “The short end is still weak with where ratios are standing,” he said.
Though he wasn’t in the Philadelphia schools deal, he expected it saw strong demand because it likely had a fair amount of spread due to the state intercept program.
He said the uninsured portion likely did better than the insured portion because of the size and more yield availability as investors are searching for higher returns overall — albeit not going below the triple-B or single-A market to do so.
Thursday saw the two notable deals price, including the week's largest, from a Pennsylvania issuer.
Bank of America Merrill Lynch priced the School District of Philadelphia's $252.92 million of general obligation bonds. The majority of the deal is backed by the Pennsylvania State Aid Intercept Program and is rated Aa2 by Moody's and A-plus by Fitch. Half of the split bullet, series B bonds are insured by Assured Guaranty Municipal Corp., and rated AA by S&P.
Morgan Stanley priced Rutgers University's $144.71 million bonds, with $100 million being taxables.
Thursday’s bond sales
School District of Philadelphia
Click here for the $252.92M pricing
Click here for the $100M taxable pricing
Tax-exempt money market funds saw outflows
Tax-exempt money market funds experienced outflows of $240.7 million, lowering total net assets to $135.15 billion in the week ended March 20, according to The Money Fund Report, a service of iMoneyNet.com.
This followed an outflow of $600.6 million on to $135.39 billion in the previous week.
The average, seven-day simple yield for the 198 weekly reporting tax-exempt funds increased to 0.74% from 0.67% the previous week.
The total net assets of the 831 weekly reporting taxable money funds decreased $17.65 billion to $2.654 trillion in the week ended March 19, after an outflow of $4.76 billion to $2.672 trillion the week before.
The average, seven-day simple yield for the taxable money funds increased to 1.14% from 1.09% from the prior week.
Overall, the combined total net assets of the 1,029 weekly reporting money funds decreased $17.89 billion to $2.790 trillion in the week ended March 19, after outflows of $5.36 billion to $2.807 trillion in the prior week.
Bond Buyer 30-day visible supply at $5.43B
The Bond Buyer's 30-day visible supply calendar decreased $178.5 million to $5.43 billion on Thursday. The total is comprised of $2.40 billion of competitive sales and $3.03 billion of negotiated deals.
Previous session's activity
The Municipal Securities Rulemaking Board reported 40,271 trades on Wednesday on volume of $9.953 billion.
California, New York and Texas were the states with the most trades, with the Golden State taking 17.239% of the market, the Empire State taking 10.444% and the Lone Star State taking 9.299%.
The Treasury Department announced these auctions:
- $29 billion seven-year notes selling on March 28
- $35 billion five-year notes selling on March 27
- $30 billion two-year notes selling on March 26
- $15 billion one-year 10-month floating rate notes selling on March 28
- $24 billion 364-day bills selling on March 27
- $45 billion 182-day bills selling on March 26
- $51 billion 91-day bills selling on March 26
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.