Secondary bond market

The new-issue calendar falls to an estimated $1.154 billion, with $939.1 million negotiated deals on tap and $214.8 million of competitives.

The deal would give the company time to seek additional equity, debt and federal funds.

The long-awaited jobs report paints a mixed picture for market participants: nonfarm payrolls increased by a greater-than-expected119,000 in September, but the unemployment rate rose to 4.4%.

The market is in a bit of a lull right now as it braces for a deluge of economic data, which could spark volatility, said Jeff Timlin, a partner at Sage Advisory.

The muni market has "demonstrated more conviction with steady demand and appealing relative yields weighing on the long-end while shifting dynamics on the short-end have led to municipals selling-off," said Tim Iltz, fixed income credit and market analyst at HJ Sims.

The "data dumps" over the next several weeks could lead to market volatility, said Abdulla Begai, director and fixed income portfolio management at A&M Private Wealth Partners.

Issuance year-to-date is at $505.245, just shy of 2024's record of $507.585 billion, with $11.109 billion of supply on the calendar for the week of Nov. 17.

For munis, the end of the shutdown helps steady the backdrop, said James Pruskowski, an investor and market strategist.

"Continuing yield stability ... suggests a comfortable market that, even with the shutdown apparently close to ending, may resist/lag potential price/yield changes in taxables," said Matt Fabian, president of Municipal Market Analytics.

Some of the most active sectors have been education (+29%), GOs (+17%) and healthcare (+17%), said Kim Olsan, senior fixed income portfolio manager at NewSquare Capital.

Assured Guaranty commented on Brightline and PREPA during its third-quarter earnings call, on which the company reported a 46% increase in third quarter gross par written year over year, to $7.85 billion from $5.38 billion.

The muni market may see additional volatility due to "uncertainties related to the future of tariffs and stronger inflation prints," said Barclays strategists led by Mikhail Foux.

Investors added $1.266 billion to municipal bond mutual funds in the week ended Wednesday, following $744.3 million of inflows the prior week, according to LSEG Lipper data.

While the market navigates a surge in supply, another focus area has become elections and their potential to shift market demand, as several regional election results will likely garner greater attention over the next few months, said Kim Olsan, senior fixed income portfolio manager at NewSquare Capital.

Tuesday saw a good slate of deals, including the acceleration of Ohio's $508.865 million of GOs and Austin's $419.035 million of electric utility system revenue refunding bonds.

"Normalized supply, a supportive rate environment and favorable technicals propelled the municipal market to the best October performance [in decades]," said Robert J. Lind.

Meanwhile, the Brightline West train project has floated a possible debt exchange ahead of its own mandatory redemption later this month.

Next week's issuance is slated to be "substantial" — an estimated $13.1 billion — although that is expected to be met with "solid" November reinvestment capital, J.P. Morgan strategists said.

Technicals are supposed to become slightly more favorable into year-end, said Jeremy Holtz, a portfolio manager at Income Research + Management.

"The knee-jerk reaction of the markets to the Fed meeting (and press conference) was to sell stocks and bonds, because [Fed] Chairman Jerome Powell said that an additional rate cut in December wasn't a sure thing," said Northlight Asset Management Chief Investment Officer Chris Zaccarelli.