Buy side

Standard & Poor's has released a credit conditions forecast that is more positive for states than for localities.

Municipal bond issuance is expected to tick up this week, although it still remains at relatively low levels.

WASHINGTON — Securities and Exchange Commission chairman Mary Schapiro wants to move forward with regulations aimed at improving the stability of money-market funds, despite strong opposition from industry and state and local government groups.

Sturdy demand for tax-exempt paper and falling Treasuries pushed municipal yields in the intermediate and long ends of the curve lower throughout much of the week.

Municipal bond mutual funds saw a huge week of inflows, as investors continue to see strength in the market.

Tax-exempt money market funds generated inflows for the first time in nearly a month, as $2.84 billion of new cash flowed in and total net assets settled at $274.96 billion in the week ended May 7, according to the Money Fund Report, a service of iMoneyNet.com.

Record-low long-term municipal bond yields may generate the most press these days, but investors still see the most value in the intermediate part of the yield curve.

In a sign of continued financial stress, state and local governments again cut employment in April.

The industry needs a shake-up, Jules Kroll said. And he's trying to provide one, founding the Kroll Bond Rating Agency Inc. in 2010 with help from his son, Jeremy.

Volume for the municipal market continues to tick down while investor demand for tax-exempt paper remains robust.

It's been another strong week for municipal bonds as yields fell and investors gobbled up new issuance. Demand in the primary propelled the market as major deals saw yields lowered around five basis points, on average. In some cases, issues were accelerated to market or upsized.

In the first quarter of 2012, Moody's Investors Service downgraded the second highest quarterly total of municipal debt in the last 10 years.

While individual investors — the primary owners of municipal debt — have generally increased their holdings in the last 10 years, some institutional investors have trimmed their holdings and others have been aggressive buyers.

Municipal bond volume should hold steady this week, buttressed by a $1.8 billion Illinois deal that has the industry's attention.

Investors piled into muni bond mutual funds this past week.

It was a quiet week for an otherwise indecisive municipal market.

Hefty outflows from tax-exempt money market funds continued for the second week, as $3.77 billion bled out and total net assets sank to $276.92 billion in the week ended April 23, according to the Money Fund Report, a service of iMoneyNet.com.

After two quarters of decline, public finance credit stabilized in the first quarter of 2012, Standard & Poor's reported.

Rumblings heard from Washington recently regarding a threat to the tax-exempt status of municipal bonds don't seem to trouble retail investors, who have increased their purchases of munis this year, mostly through mutual funds.

What kinds of funds are retail investors interested in and what does it mean for the market?