Buy side

New York's MTA, restoring its subway and commuter rail systems after Hurricane Sandy's damage, will continue its flurry of bond activity this week.

More than 40% of states have poor pension funding ratios, Morningstar municipal credit researcher Rachel Barkley said.

Municipal bond volume saw a slight bump for the month of October, continuing what has been an upward path for the issuance of new muni debt in 2012. Long-term muni bond issuance last month rose 3%, and has increased 39% for the year to date.

Issuance in the municipal bond market should make a resounding return to pre-storm levels this week. Volume should total an estimated $7.06 billion, up from a hurricane-pared $1.66 billion last week.

The Bond Buyer queried some municipal market experts asking them their top concerns for the market depending on the outcome of the 2012 Presidential election. The fate of the municipal tax exemption was a major concern.

After 28 straight weeks of inflows to muni bond funds, the market saw outflow for the week ended Oct. 31. Funds that report their flows weekly recorded outflows of $123 million for the week ended Oct. 31, Lipper FMI numbers show.

Wary investors in the path of Hurricane Sandy contributed to the $1.10 billion of cash that flowed out of tax-exempt money market funds in the week ended Oct. 29.

Moody's Investors Service, Standard & Poor's and Fitch Ratings directors say Hurricane Sandy could create a downward impact on a few of the most severely impacted credits.

Hurricane Sandy’s floodwaters immobilized much of the municipal market, but not the buyside. With bond issuance almost halted, investors are even more cautious and hesitant than they have been of late.

Because of Hurricane Sandy, Maui County, Hawaii, postponed the competitive sale of $70.1 million in general obligation bonds to Thursday at 1 p.m.

Hurricane Sandy left major challenges for many municipal bond firms after the Financial District of Manhattan was hammered hard by the storm.

Kansas Gov. Sam Brownback last week endorsed legislation that would require local governments to lower their property tax rates automatically when assessed valuations increase.

The scheduled approach of Hurricane Sandy has cast a shadow over the municipal bond calendar for the week. At press time, many municipal bond issuers scheduled to price deals on Tuesday said they would go through with Tuesday's scheduled deals.

The Securities Industry and Financial Markets Association said Sunday afternoon it expected U.S. bond markets to be open Monday.

A proposed merger between two large nonprofit healthcare systems is a credit positive for the nonprofit healthcare sector, Moody's Investors Service says.

An association representing safety-net hospitals is lobbying Congress to restore cuts that are built into the new federal health care law.

Industrial development revenue bonds have shown the best total return of all municipal bond sectors so far this year.

In the third quarter 79% of Moody's Investors Service's ratings actions were downgrades.

Investors poured $666 million into weekly reporting municipal bond mutual funds this past week, marking a 28th straight week of inflows.

Neither primary volume nor moderately volatile Treasuries did much to upset the municipal market's steady mien this week. Despite the modest backup in most rates among munis and Treasuries on the week, muni bond indexes held their levels.