Buy side

While municipal bond volume was essentially flat by par value in 2014, there were significant variations from sector to sector.

Total long-term municipal bond issuance did what no one thought it would do in 2014: beat 2013's total issuance.

Note volume was 17% lower than it was last year as state and local governments continued a period of austerity, supported by a stronger United States economy that helped strengthen finances and curtail the need for short-term cash flow.

The municipal bond market will be more robust for the week of Feb. 23, with roughly $5.652 billion more issuance than in the past holiday-shortened week.

Stifel Financial Corp. reportedly is in talks to buy Sterne Agee Group Inc., continuing an acquisition spree that's vaulted the St. Louis based brokerage and investment banking firm into the top 10 among municipal underwriters.

For the week ended Feb. 19, the weekly average yield to maturity of the Bond Buyer Municipal Bond Index, which is based on 40 long-term bond prices, jumped five basis points to 4.26% from 4.21%.

With hospital issuance up so far in 2015 and likely to stay that way, investors may not be sufficiently compensated for the sector's risks, according to Municipal Market Advisors.

As taxable fixed-income rates remain near all-time lows, Kentucky is one of several states eyeing pension obligation bonds to deal with unfunded retirement obligations.

It looks like it will be pretty quiet trading in the week ahead. Only about $4.6 billion of new municipal bonds are scheduled to be sold during the holiday-shortened week as issuers and underwriters will be watching market conditions closely.

The weekly average yield to maturity of The Bond Buyer Municipal Bond Index, which is based on 40 long-term bond prices, rose 9 basis points to 4.21% from 4.12% for the week ended Feb. 5.

Moody's Investors Service reported more upgrades than downgrades by number and par value in the fourth quarter, marking "economic and financial stabilization" in public finance.

Standard & Poor's upgraded Miami's general obligation bond ratings to A-plus from BBB citing the city's improved financial management practices and budget flexibility.

Two municipal strategists are taking different roads to minimize risk while adding value in a market fraught with uncertainty over interest rates.

If yields continue to rise, more deals could be pulled in the upcoming week

The weekly average yield to maturity of The Bond Buyer Municipal Bond Index, which is based on 40 long-term bond prices, was unchanged from the previous week at 4.12%, for the week ended Feb. 5.

Airport management's flexibility and experience are key factors in rating a facility's general revenue bonds, Kroll says.

Yield-hungry investors should be wary of indulging in triple-B bonds in the current municipal market when looking for extra yield as they are fully valued relative to high-quality bonds, according to Dorian Jamison, municipal analyst at Wells Fargo Advisors.

Issuance is expected to approach $9 billion in the coming week as February brings a $1 billion Pennsylvania competitive general obligation offering that was postponed because of the Jan. 26-27 blizzard in the Northeast.

For the week ended Jan. 29, the weekly average yield to maturity of the Bond Buyer Municipal Bond Index, which is based on 40 long-term bond prices, dropped one basis point to 4.12% from 4.13%.

Lumesis said it's forming a strategic partnership with Bitvore Corp. to provide the market with a single platform that eases access to up-to-date data on material changes in municipal bond issuers and obligors.