Municipals were little changed Tuesday with the focus squarely on the active primary slate as U.S. Treasury yields fell slightly out long and equities were mixed near the close.
The two-year muni-to-Treasury ratio Tuesday was at 64%, the three-year at 66%, the five-year at 67%, the 10-year at 66% and the 30-year at 84%, according to Refinitiv Municipal Market Data’s 3 p.m. EST read. ICE Data Services had the two-year at 65%, the three-year at 66%, the five-year at 67%, the 10-year at 67% and the 30-year at 84% at 3:30 p.m.
The muni market remains “well bid,” said Anders S. Persson, Nuveen’s chief investment officer for global fixed income, and Daniel J. Close, Nuveen’s head of municipals.
As an “outsized amount” of reinvestment money returns to the muni market, with $38 billion already deployed on June 1 and another $42 billion expected beginning July 1, “issuers are taking advantage” of the money as they continue to issue “outsized amounts of deals almost on a weekly basis,” Persson and Close said.
Issuance tops $12 billion this week, with the primary market picking up steam Tuesday, led by several series of Washington GOs totaling $1.315 billion, in the competitive market.
Bellwether Washington (Aaa/AA+/AA+/) sold $440.3 million of various purpose GOs, Series 2025A, Bid Group 2, to BofA Securities, with 5s of 8/2041 at 3.46%, 5s of 2044 at 3.66% and 5s of 2049 at 3.86%, callable 8/1/2034.
The state sold $381.715 million of various purpose GOs, Series 2025A, Bid Group 1, to BofA Securities, with 5s of 8/2027 at 2.99%, 5s of 2029 at 2.95%, 5s of 2034 at 3.00%, 5s of 2039 at 3.28% and 5s of 2040 at 3.37%, callable 8/1/2034.
Washington sold $286.12 million of various purpose GO refunding bonds, Series R-2025A, to J.P. Morgan Securities, with 5s of 7/2025 at 3.19%, 5s of 2029 at 2.97%, 5s of 2034 at 3.00% and 5s of 2039 at 3.28%, callable 7/1/2034.
The state also sold $206.67 million of motor vehicle fuel tax and vehicle-related fees GOs, Series 2025B, to J.P. Morgan Securities, with 5s of 6/2025 at 3.19%, 5s of 2029 at 2.97%, 5s of 2034 at 3.00%, 5s of 2039 at 3.28%, 5s of 2044 at 3.66% and 5s of 2049 at 3.91%, callable 6/1/2034.
In the negotiated market Tuesday, J.P. Morgan held a one-day retail order for $760.255 million of MTA Bridges and Tunnels climate-certified payroll mobility tax senior lien refunding green bonds, Series 2024C, from the Triborough Bridge and Tunnel Authority (/AA+/AA+/AA+/), with 5s of 11/2030 at 3.00%, 5s of 2034 at 3.07% and 5s of 2039 at 3.33%, callable 11/15/2034.
Goldman Sachs priced for the Grand River Dam Authority, Oklahoma, (A1/AA-//) $350.13 million of revenue bonds. The first tranche, $284.86 million of refunding bonds, Series 2024A, with 5s of 6/2025 at 3.22%, 5s of 2030 at 3.03%, 5s of 2034 at 3.09%, 5s of 2039 at 3.37% and 5s of 2042 at 3.63%, callable 6/1/2034.
The second tranche, $65.27 million of taxables, Series 2024B, saw all bonds price at par: 4.868s of 6/2027, 4.819s of 2029 and 4.942s of 2034, noncall.
Ramirez priced for the Texas Department of Housing and Community Affairs (Aaa/AA+//) $250 million of residential mortgage revenue bonds. The first tranche, $150 million of non-AMT bonds, Series 2024C, saw 5s of 7/2025 at 3.20%, 5.25s of 1/2029 at 3.35%, 5.25s of 7/2029 at 3.35%, 3.8s of 1/2034 at par, 3.9s of 7/2034 at par, 4.1s of 1/2039 at par, 4.45s of 1/2044 at par, 5s of 1/2049 at 4.65%, 5.125s of 1/2054 at 4.70% and 6s of 7/2054 at 4.10%, callable 1/1/2033.
The second tranche, $100 million of taxables, Series 2024D, saw all bonds price at par — 5.099s of 7/2025, 4.726s of 1/2029, 4.776s of 7/2029, 5.148s of 1/2034, 5.198s of 7/2034, 5.548s of 1/2039, 5.734s of 1/2044 and 5.784s of 1/2048 — except for 6s of 1/2054 at 5.406%, callable 1/1/2033.
Stifel, Nicolaus & Co. priced for the Ohio Water Development Authority (Aaa/AAA//) $250 million of drinking water assistance fund sustainability revenue bonds, Series 2024A, with 5s of 12/2033 at 2.89%, 5s of 6/2034 at 2.90%, 5s of 12/2034 at 2.90%, 5s of 12/2039 at 3.32%, 5s of 12/2044 at 3.62% and 5s of 12/2045 at 3.66%, callable 6/1/2034.
Baird priced for the Hamilton County Public Building Corp., Indiana, (/AAA//) $102.5 million of lease rental revenue bonds, Series 2024, with 5s of 7/2026 at 3.24%, 5s of 1/2029 at 3.10%, 5s of 7/2029 at 3.10%, 5s of 7/2034 at 3.14%, 5s of 7/2039 at 3.40%, 4s of 7/2044 at 4.20% and 4s of 1/2050 at 4.38%, callable 7/1/2033.
Volume stands at $224.13 billion year-to-date, up 38.5% from $161.848 billion at this time last year, according to LSEG. Given the larger issuance,
Demand for the increased supply has been “solid” if nearly largely reliant on income-oriented small lot buyers, noted Municipal Market Analytics, Inc. Partner Matt Fabian. Through last week, buyers continued to be separately managed account/retail in size, he said.
The five-day average of customer buy size fell below $350,000 for most of June, while the average customer sell size is now at its smallest level of 2024, he said.
The market is once again averaging less than 60,000 trades daily, Fabian added.
However, the size of buyers hasn’t posed a problem for large deals, such as the
SMAs are still income based: the triple-A-rated Arlington, Virginia, deal was “perhaps too rich,” with 5s of 2036 weakening two basis points through Friday, Fabian said.
Better institutional interest is needed for muni yields, especially long maturities, to rally with USTs on “any constructive data or Fed comments,” he noted.
“And that’s not apparent as of now, with still low ratios and low tax rates boxing out crossover buyers, and with traditional fund flows intermittent at best: the last a concern that it’s occurring despite a good rebound in fund NAVs,” Fabian said.
AAA scales
Refinitiv MMD’s scale was little changed: The one-year was at 3.09% (unch) and 3.05% (unch) in two years. The five-year was at 2.85% (unch), the 10-year at 2.79% (unch) and the 30-year at 3.69% (unch) at 3 p.m.
The ICE AAA yield curve was mixed: 3.11% (-3) in 2025 and 3.07% (unch) in 2026. The five-year was at 2.88% (+1), the 10-year was at 2.83% (unch) and the 30-year was at 3.68% (-1) at 3:30 p.m.
The S&P Global Market Intelligence municipal curve was cut up to three basis points: The one-year was at 3.14% (unch) in 2025 and 3.08% (unch) in 2026. The five-year was at 2.86% (+1), the 10-year was at 2.85% (+1) and the 30-year yield was at 3.67% (unch) at 3 p.m.
Bloomberg BVAL was little changed: 3.14% (unch) in 2025 and 3.09% (unch) in 2026. The five-year at 2.89% (+1), the 10-year at 2.80% (+1) and the 30-year at 3.71% (unch) at 3:30 p.m.
Treasuries were a touch firmer out long.
The two-year UST was yielding 4.731% (flat), the three-year was at 4.456% (-1), the five-year at 4.257% (-1), the 10-year at 4.229% (-2), the 20-year at 4.467% (-2) and the 30-year at 4.362% (-2) at 3:45 p.m.
Negotiated calendar
Los Angeles (MIG-1/SP-1+//) is set to price Wednesday $1.5 billion of tax and revenue anticipation notes, serial 2025. Loop Capital Markets.
The Massachusetts Bay Transportation Authority (/AA+/AAA/AAA/) is set to price Thursday $1.05 billion of senior sales tax bonds, consisting of $951.99 million of Series A bonds and $99.71 million of sustainability Series B bonds. Morgan Stanley.
The Omaha Public Power District (Aa2/AA//) is set to price Wednesday $608.755 million of electric system revenue bonds, consisting of $293.54 million, Series 2024A, serial 2026-2045, terms 2049, 2054, and $315.215 million, Series 2024B, serial 2025-2045. BofA Securities.
The Wisconsin Health and Educational Facilities Authority (/BBB/BBB/) is set to price Wednesday $381.905 million of Marshfield Clinic Health System revenue refunding bonds, Series 2024A, serials 2025-2029, 2031-2033, 2035-2036, term 2054. Barclays.
The Marshfield Clinic Health System (/BBB/BBB/) is set to price Wednesday $176.975 million of taxable corporate CUSIPs, Series 2024, term 2034. Barclays.
The Connecticut Health and Educational Facilities Authority is set to price Thursday $337 million of Yale New Haven Health Issue tax-exempt self-liquidity weekly VRDNs revenue bonds, Series 2024C. Barclays,
The Clear Creek Independent School District, Texas, (Aaa//AAA/) is set to price Wednesday $170.255 million of PSF-insured unlimited tax school building and refunding bonds, Series 2024, serials 2025-2044. BOK Financial Securities.
The State Building Authority of Michigan (Aa2//AA/) is set to price $130 million of revenue refunding bonds for the Facilities Program, Series II, serials 2024-2044, terms 2049, 2054, 2059. Jefferies.
The Greater Texas Cultural Education Facilities Finance Corp. (Baa2///) is set to price Wednesday $119.485 million of revenue bonds for the Texas Biomedical Research Institute Project, consisting of $99.525 million of tax-exempts, Series 2024A, serials 2030-2044, terms 2049, 2054, and $19.960 million of taxables, Series 2024B, term 2037. BofA Securities.
The Lewisville Independent School District, Texas, (/AAA//) is set to price Thursday $112.265 million of PSF-insured unlimited tax school building and refunding bonds, serials 2025-2044. Siebert Williams Shank.
The Little Elm Independent School District, Texas, (/AAA//) is set to price next week $105.995 million of PSF-insured fixed and variable rate unlimited tax school building bonds, Series 2024, serials 2025-2044, terms 2049, 2054, 2054. Jefferies.
The Kings Local School District, Ohio, (/AA//) is set to price Thursday $100 million of school improvement unlimited tax general obligation bonds, Series 2024. RBC Capital Markets.
Competitive calendar
The Little Rock School District (Aa2///) is set to sell $101.885 million of construction bonds, Series B, at 11 a.m. eastern Wednesday.
The Phoenix Civic Improvement Corp. (Aa1/AAA/AA+/) is set to sell $180 million of subordinated excise tax revenue bonds, Series 2024, at 11:15 a.m. Wednesday.
Collin County, Texas, is set to sell $212.070 million of limited tax permanent improvement and refunding bonds, Series 2024, at 11:30 a.m. eastern Wednesday.
Layla Kennington contributed to this story.