The municipal market was quiet and unchanged Friday, with participants largely on the sidelines following Thursday's sizeable rally and ahead of the hefty new-issue calendar that awaits this week.

"There's not a ton going on," a trader in New York said. "We rallied pretty seriously yesterday, but I'd say we're fairly unchanged, just because there's nobody really around, and not a lot trading. If anything, we're more expensive by a basis point or two. The tone is definitely firmer. I'm just not sure there's enough activity to really call it better."

Trades reported by the Municipal Securities Rulemaking Board Friday showed little movement. A dealer sold to a customer insured Puerto Rico 5.5s of 2019 at 5.30%, even with where they traded Thursday. A dealer sold to a customer Oregon 5s of 2033 at 5.03%, even with where they were sold Thursday. A dealer sold to a customer Colorado Housing & Finance Authority 5s of 2032 at 5.24%, even with where they traded Thursday.

"It's quiet today," a trader in Los Angeles said. "I guess after all yesterday's activity, people were in need of a breather, and given that it's Friday, it seems like a good time for a breather. We've got a big calendar coming up [this] week, led by that big Cal deal, so we'll see how it goes. But today, we're flat."

After digesting a revised $5.23 billion of new issues last week - highlighted by the mostly oversubscribed $1.54 billion Wisconsin state appropriation financing - California this week will leave an even larger footprint in the primary with its planned $4 billion sale of general obligation bonds as volume soars to an estimated $9.25 billion, according to Thomson Reuters.

The Golden State issue will be the largest to hit the market since 2007, when Ohio's Buckeye Tobacco Settlement Financing Authority sold $5.53 billion. California officials believe the deal will be successful despite receiving dual, one-notch downgrades Thursday from Moody's Investors Service and Fitch Ratings to A2 and A, respectively, on the heels of a downgrade from Standard & Poor's to A last month. The mammoth deal is expected to be priced by Merrill Lynch & Co. on Wednesday, following a two-day retail order period that begins today.

The Treasury market showed some losses Friday. The yield on the benchmark 10-year Treasury note, which opened at 2.60%, was quoted near the end of the session at 2.65%. The yield on the two-year note was quoted near the end of the session at 0.89% after opening at 0.86%. The yield on the 30-year bond, which opened at 3.63%, was quoted near the end of the session at 3.67%.

As of Thursday's close, the triple-A scale in 10 years was at 123.2% of comparable Treasuries, according to Municipal Market Data. Additionally, 30-year munis were 134.6% of comparable Treasuries. Also, as of the close Thursday, 30-year tax-exempt AAA-rated general obligation bonds were at 148.6% of the comparable London Interbank Offered Rate.

The economic calendar was light Friday.

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