Buy side

As the end of the year nears, tax-exempt money market fund flows are back in positive territory thanks to modest inflows of $643.2 million in the week ended Dec. 19, increasing total net assets slightly to $290.43 billion, according to the Money Fund Report, a service of iMoneyNet.com.

New issuance in Muni Land kicks into holiday mode this week.

For the third consecutive quarter, households continued to shed some of the municipal bonds they own, while the total volume of outstanding muni debt also declined slightly compared to the previous three months, according to new data from the Federal Reserve Board.

Investors don't see too many avenues for yield in the financial markets these days. But municipal bond mutual funds must still look attractive to them, because they continued to pour money into them for a second straight week.

Municipal bond yields are so far capping an interesting year with a fine run to the holiday season.

After tax-exempt money market funds last week experienced their largest weekly inflows year to date, seeing a one-week increase of 1.9%, assets this week fell by $157.4 million and settled at $289.78 billion for the week ended Dec. 12, according to the Money Fund Report, a service of iMoneyNet.com.

A year ago, Fitch Ratings had a negative outlook on states, but now it has a stable outlook for the coming year.

After 16 years as a municipal research analyst on the buy side of the market, Tom Weyl, vice president and director of research at Eaton Vance Management in Boston, will start the new year off with a new career on the sell side.

Bond buyers place more weight on Moody's Investors Service ratings than on Standard & Poor's ratings, according to a recent Loop Capital Markets study.

With trading active on much of bankrupt American Airlines' $3.2 billion of special facilities revenue bonds, some market participants are sounding a cautionary tone in assessing their value, as bargain hunters eye the airline's discounted bonds secured by collateral.

A Puerto Rico infrastructure financing and a Detroit water revenue sale will lead the activity in the primary market this week as volume is expected to dip slightly from last week.

Reinvestment cash jolted the municipal bond market into life this past week.

In their largest one-week move so far this year, tax-exempt money market funds gained a stunning 1.9%, or $5.27 billion, from last week, bringing assets in the week ended Dec. 5 to $289.94 billion, according to the Money Fund Report, a service of iMoneyNet.com.

For online vendors, this year's record sales for Cyber Monday may have been like Santa arriving early, but for states and municipalities that collect sales taxes, it was more like getting a lump of coal in their Christmas stockings.

Following last week's post-Thanksgiving feast, the municipal market will continue to usher in December with an equally hearty slate of primary market deals. Yields remained mostly firm on Friday as investors clamored for high-quality paper in the scarce secondary.

Outflows among tax-exempt money market funds caught fire in the week ended Nov. 28, as $1.56 billion exited the funds and total net assets decreased to $284.67 billion, according to the Money Fund Report, a service of iMoneyNet.com.

The municipal bond market followed up a holiday week with relatively steady yields in the face of increasing supply, slack Treasuries and a stock market rally.

Assets of tax-exempt money market funds fell by a modest $150 million as total net assets finished at $286.23 billion in the week ended Nov. 21, according to the Money Fund Report, a service of iMon­eyNet.com.

Traders anticipate that the recent delicate balance between supply and demand in the muni market will be maintained even as issuance ramps up this week in the face of rollover funds.

Analysts continue to warn that employee pensions and retirement benefits are a growing problem for municipal government finances.