Buy side

An expected swell in the volume of current refundings in the fourth quarter will be a welcome arrival even if it doesn't cure the market's prolonged imbalance, analysts say.

The Kroll Bond Ratings Agency assigned its AA rating to Los Angeles' general obligation bonds Tuesday, its first rating of the city.

As the end of summer approaches and supply continues to dwindle, weekly volume in the municipal market is expected to sink to $2.53 billion, the lowest level in almost six months. A $480 million offering from the Virginia Public Building Authority is the largest deal on the new-issue calendar this week.

A recent Moody's downgrade of the Philadelphia School District to Ba3 was another indication of the district's growing financial problems, but a state intercept program insulates holders of the district's $3.1 billion in bonds from those troubles.

The terms of a loan turned the outlook on Florida Gulf Coast University's debt to negative, and could result in a rating downgrade of two notches, Standard & Poor's said.

Fitch Ratings said Detroit's offer to holders of $5.2 billion of water and sewer bonds to tender their debt as part of a bankruptcy settlement does not constitute a distressed debt exchange, an analysis that could bode well for ratings the planned refinancing of the debt.

Moody's Investors Service on Tuesday withdrew its general obligation bond rating on Tehachapi Valley Healthcare District, Calif. citing a lack of financial information for fiscal 2013, affecting $63 million in debt.

California's new law to require issuers to disclose bank loans will likely result in lower borrowing costs, according to a report from Municipal Market Advisors.

Volume will slip from last week, remaining lighter than usual, as an estimated $4.2 billion makes its way to market.

The Puerto Rico Electric Power Authority put off a day of reckoning in an agreement with creditors announced Thursday, but still may be headed for what would be the largest municipal bond default in U.S. history.

Though New Jersey and California are on starkly different credit paths, municipal analysts said their recent trading patterns suggest equally-strong demand.

The Puerto Rico Electric Power Authority announced agreements with insurers and bondholders controlling more than 60% of PREPA's outstanding bonds to amend existing bond documents to provide PREPA with liquidity and for PREPA to appoint a chief restructuring officer.

The Bond Buyer's muni bond indexes strengthened in the week ending Aug. 14.

Despite strong investment gains and other improvements, a persistent underlying weakness remained the underlying theme for the non profit health care sector in 2013, according to Standard & Poor's.

Zero coupon tobacco bonds may fall especially hard when interest rates begin to rise, according to analysts who follow the high yield, long maturity securities.

Hospitals in the 24 states that have opted against expanding Medicaid under federal healthcare reform stand to lose out on $168 billion over 10 years while states will lose out on more than $400 billion, a new report from the Urban Institute concludes.

With higher education issuance set to jump, analysts are pondering whether the higher yields on the credits are worth the risk.

Large deals in New York and New Jersey -- led by New York City's $900 million general obligation bond refunding -- are expected to spark high demand this week due to their specialty state status despite an otherwise lackluster primary market dulled by the seasonal summer pullback in issuance.

Municipal bonds on the intermediate part of the curve outperformed long term maturities, producing a positive return with less volatility in the past 18 months, according to Granite Springs Asset Management.

The Bond Buyer's muni bond indexes were narrowly mixed in the week ending Aug. 7.