Thursday, Apr. 16, 2015

Municipal Bond Market
Munis are slightly stronger this morning after another mixed trading day.  Secondary flow was nonexistent again with the majority of buyers participating in the primary market. Bank of America priced the Port Authority of NY & NJ after a one day retail order period.  The 5’s of 2035 were priced to yield a 3.05%, unchanged from the previous day.  We should see buyers focused on the primary again as they await allocations and the pricing of the remaining deals this week.  The highlight of today’s calendar is the pricing of $200mln NYC TFA taxable bonds.   30 day supply declined to $10.3bln from about $11.4bln yesterday.

PR benchmarks GOs remained unchanged on Wednesday. GOs continue to trade in the low $80.00s (10.10%) after trading as high as $86.625 (9.56%) in mid-March. 5000m+ bonds traded yesterday @ $80.75 (10.27%).  We should see benchmark GOs remain in this range until we get more clarity on the pricing of the new deal. In credit news, PREPA agreed to an additional 15 day extension with creditors.  PREPA debt continued to trade in the low $60s after the announcement.   

30-Day visible supply: $11.42bln

Deals we will be bidding today:
$23,255     Multnomah County School Sistrict No. 1, OR     2017-2033     Aa1/AA+
$200,000     NYC TFA Taxable     2020-2029     Aaa1/AAA
$16,325     Sheldon, TX Independent School District *PSF*     2017-2035     Aaa/
$3,300     Sterling, MA G.O.s