The Bond Buyer’s weekly yield indexes declined this holiday-shortened week, as the municipal market grew firmer in most of the week’s sessions, with the majority of the gains situated on the long end of the curve.
Fred Yosca, managing director and head of trading at BNY Capital Markets Mellon, said that the market has been “better pretty much every day, just a question of how much.”
“It is kind of quiet, largely because people are kind of stymied when trying to find bonds that are attractive,” Yosca said.
“My inventory is very light because there’s not a lot to choose from,” he said. “The calendar was light, secondary was light, offerings that are out there are high as a kite — there’s no give in the offerings. But the calendar picks up next week, and that’ll help. That might loosen up the levels a bit, too.”
In new issuance this week, Merrill Lynch & Co. priced $518.4 million of taxable Build America Bonds for the Chicago Board of Education.
Barclays Capital priced $250 million of BABs for the University of Texas Board of Regents.
New York’s Triborough Bridge and Tunnel Authority competitively sold $200 million of BABs to Merrill Lynch.
The Bond Buyer 20-bond index of 20-year general obligation bond yields declined four basis points this week to 4.33%. That is the lowest the index has been since Feb. 7, 2008, when it was also 4.33%.
The 11-bond index of higher-grade 20-year GO yields declined three basis points this week to 4.08%, which is the lowest the index has been since Jan. 17, 2008, when it was also 4.08%.
The revenue bond index, which measures 30-year revenue bond yields, dropped 10 basis points this week to 5.33%. That is the lowest level for the index since Sept. 11, 2008, when it was 5.09%.
The 10-year Treasury note yield rose one basis point this week to 3.34%, but remained below its 3.47% level from two weeks ago.
The 30-year Treasury bond rose three basis points this week to 4.18%, but remained below its 4.23% level from two weeks ago.
The Bond Buyer one-year note index, which is based on one-year tax-exempt note yields, declined one basis point this week to 0.78%. This is the lowest the index has been since July 22, when it was 0.72%.
The weekly average yield to maturity on The Bond Buyer’s 40-bond municipal bond index, which is based on 40 long-term municipal bond prices, finished at 5.20%, down nine basis points from last week’s 5.29%.