Secondary bond market

Municipals are sitting out the ups and downs in equities and UST, with $12 million scheduled for the primary in the final week of 2021.

Tax risks continue to linger as they are preserved as a potential offset for whatever level of spending all 50 Democratic senators can agree to, but potential approval of the legislation remains a question mark.

U.S. Treasuries saw losses pushing municipal to UST ratios on the 10- and 30-year lower again.

The Build Back Better in its current form essentially has been killed by Sen. Joe Manchin, likely limiting the potential for tax hikes in the coming year.

Municipal volume is estimated at a lean $558.8 million with $494.7 million of negotiated deals and $64.2 million on the competitive slate. Thirty-day visible supply is at $3.17 billion.

Despite outside pressures, municipal fundamentals are strong with improving credit pictures, issuers flush with federal cash and the ongoing supply-demand imbalance.

The index, which tracks over 2,800 securities, went live Wednesday. While ESG investment considerations have grown around the globe, the muni market is at the beginning stages and there is no universally accepted definition of ESG.

It marked the 40th straight week of positive flows into the long-term funds and brought the total inflows for this year near $82 billion. Exchanged-traded funds saw $168M of inflows.

Over the past year, Lumesis has expanded the capabilities of its DIVER suite of muni-focused business and regulatory solutions.

Triple-A yield curves were unchanged on the day and mostly have not budged but a basis point in spots since the end of November.