Buy side

Amid continued strong demand and recent firmness that saw some yields decline as much as 12 basis points in spots during new-issue pricing last week, a $750 million revenue offering from the New Jersey Transportation Trust Fund Authority will further test the strength of the market this week.

Weekly reporting municipal bond mutual funds had a net outflow of $253 million during the period ending Nov. 5, AMG Data Services reported.

WASHINGTON - The Treasury Department's plans to issue more than $1 trillion in Treasury securities in fiscal 2009 to help raise revenues for the financial rescue plan are likely to further the recent pronounced move of municipal bond yields above Treasury yields, market participants say.

The Bond Buyer's weekly yield indexes mostly declined this week, as Treasury market gains carried municipals to a decidedly positive string of sessions.

For the second week in a row, tax-exempt money market funds saw outflows - albeit slightly less than last week - as they closed the books on October and digested a 50 basis point interest rate cut by the Federal Open Market Committee.

Goldman Sachs Asset Management LP plans to launch a new municipal closed-end fund as part of its existing lineup of tax-exempt mutual funds, according to an Oct. 24 registration with the Securities and Exchange Commission. The addition, which is to be called the Goldman Sachs Municipal Opportunity Fund, will bring the firm's number of tax-free mutual funds to six.

As a result of the credit crisis, Valley Forge, Pa.-based Vanguard Group yesterday said it will merge its $3.2 billion Vanguard Insured Long-Term Tax-Exempt Fund into its $2.8 billion Vanguard Long-Term Tax-Exempt Fund effective Dec. 12, 2008.

Weekly reporting municipal bond mutual funds had a net outflow of $134 million during the period ending Oct. 29, AMG Data Services reported.

The municipal market will see a slight decline in new-issue volume this week as some issues remain postponed due to unsettled market conditions, and as some issuers await the Election Day outcome of an estimated $66 billion of bond referendums before proceeding with their deals.

WASHINGTON - Disruption in the short-term market, failed remarketings of variable-rate bonds, and the credit deterioration of counterparties, combined with the U.S. housing market's woes, pose challenges in the coming months for state housing finance agencies, Moody's Investors Service said in a report released Friday.

While taxable money market funds are still seeing healthy inflows, tax-exempt funds suffered outflows of $1.96 billion for the week ending Oct. 27 - a stark comparison to last week's inflows of $7 billion and the gains of the last three weeks in general, according to the Money Fund Report, a service of iMoneyNet.com of Westborough, Mass.

As the government weighs bold steps to aid homeowners facing foreclosure, new data shows how big the problem has become.

Most of The Bond Buyer's weekly yield indexes increased this week, as last week's rally ebbed Monday and was followed by several mostly weaker sessions.

A pair of deals from two New York municipalities and a Texas sale will headline an estimated slate of $4.47 billion in total new-issue supply in the primary market this week - more than double the revised figures from last week - as municipal volume continues to show signs of recovery from the month-long dry spell inflicted by the nation's financial and economic turmoil.

Weekly reporting municipal bond mutual funds had a net outflow of $1.126 billion during the period ending Oct. 15, AMG Data Services reported.

The Bond Buyer's weekly yield indexes plummeted this week, after a sizeable rally Tuesday led to a historic one Wednesday, and the market then held firm yesterday.

Amid increased demand and liquidity in the short-term market, inflows kept tax-exempt money market funds in positive territory for a third week in a row, gaining $7 billion in new cash for the week ending Oct. 20, according to the Money Fund Report, a service of iMoneyNet.com.

Following the pricing of last week's $5 billion revenue anticipation note sale by California, both the short- and long-term primary markets will be much more subdued this week, with only a handful of negotiated deals expected to be priced by issuers willing to enter the market at the prevailing higher interest rates.

Weekly reporting municipal bond mutual funds had a net outflow of $2.285 billion during the period ending Oct. 15, AMG Data Services reported.

SAN FRANCISCO - The Bond Buyer's weekly yield indexes surged this week, as the market continued to struggle against a wave of capital rushing to exit.