Municipal New Issuance: Last week’s negotiated calendar totaled to just over $10.8 billion with the largest deal of the week being the $1.5 billion New York City Transitional Finance Authority issuance which AmeriVet participated in the Selling-Group. The second largest deal of the week was the $956 million Dormitory Authority of the State of New York deal which AmeriVet participated as a Selling-Group-Member as well. The third largest deal last week was the Airport Commission of the City and County of San Francisco which issued $924 million consisting of AMT bonds and Taxable bonds.

Municipal Secondary Trading: Last week, secondary trading totaled to roughly $41.8 billion with 54% of all trades being dealer sells to clients. According to Bloomberg, clients put approximately $6.3 billion up for the bid, above the total amount of bids from the prior week’s total of $6.23 billion.

Municipal Spreads: Munis yields rose slightly this past week as 10-year notes rose by just .16 basis points to close the week at 2.67%. With yields rising, munis underperformed Treasuries last week with 10-year notes now yielding 60.42% of Treasuries, compared to the prior week when the ratio was at 59.01%. The muni curve flattened slightly by .6 basis points to 71 basis points.

According to LSEG Lipper Global Fund Flows data, municipal bond funds saw investors pull roughly $548 million from their funds after 3 straight weeks of outflows. This follows the prior week’s inflow of $1.1 billion and while we did see outflows, high yield funds saw inflows of approximately $125 million.

As we pass the midway point of the month of May, muni returns dipped slightly with month-to-date returns now standing at 1.02% compared to the prior week’s return of 1.08%. Currently, the long end is returning about 1.93% and the front end is returning roughly .47%. With the inflation numbers and weak retail sales data pointing to a slowing economy, munis markets are now starting to price in a fed cut in September which should fuel a strong rally going into the summer.

Municipal Supply: This week, the negotiated calendar will have an expected volume of $9.92 billion with the largest deals of the week being the $950 million Harris County, Texas Toll Road issuance, followed by the Burbank-Glendale-Pasadena Airport Authority which is scheduled to issue $736 million, and Texas State University System will offer $607.9 million. AmeriVet will be serving as a Co-Managing underwriter for the Pennsylvania Housing Finance Agency which plans on selling $374 million in tax-exempt bonds and $75 million in taxable bonds. AmeriVet will also be a Co-Manager on the $190 million Wisconsin Housing and Economic Development Authority. AmeriVet will be participating in the Selling-Group for the Florida Housing Finance Corporation which plans on selling $150 million in taxable bonds and $100 million in tax-exempt bonds.