Municipal New Issuance: The second week of June’s negotiated calendar totaled to approximately $6.8 billion, with the largest deal being the $714 million Main Street Natural Gas issuance. The next second largest deal of last week was the Oklahoma Industries Authority deal which issued roughly $437 million. AmeriVet was in two deals this past week participating in the Selling-Group for the $117 million New Mexico Finance Authority State Transportation Refunding Revenue Bonds Series 2024A and the $80 million Minnesota Housing Finance Agency Residential Housing Finance Bonds 2024 Series L issuance.

Municipal Secondary Trading: For the second week of June, secondary trading totaled to just over $39.54 billion for the week with 51% of secondary trades being dealer sells. According to Bloomberg, clients put up roughly $6.13 billion up for the bid which is an increase from the prior week’s client’s bids wanted total of $5.79 billion.

Municipal Spreads: Munis improved once again this past week as yields on 10-year notes fell by 12 basis points to 2.81%. Although we did see a rally in munis, munis slightly underperformed Treasuries as the 10-year muni-to-Treasury ratio is now yielding 66.86% compared to 66.28% from the prior week. We did see the muni curve steepen by 1.8 basis points to end the week at 65 basis points.

For the second straight week, muni bond funds saw investors add to their funds with investors adding approximately $154 million according to LSEG Lipper Global Fund Flows data, with the bulk of the inflows being from long-term funds. This follows the prior week’s inflow of $549 million.

For the first two weeks of June, munis have rallied roughly 24 to 29 basis points, a complete 180 compared to what we saw in May where we saw yields raise as much as 34 basis points in the belly of the curve. In just the first two weeks of the month, munis have returned 1.77% so far, bringing our year-to-date return to -.17%. Before the start of the month, munis were down 1.91%. Although we are in one of the strongest two week rallies year-to-date, munis still look attractive despite the continued richness of munis compared to Treasuries. In the two weeks of the rally we have seen the 2-year ratio fall by roughly two percentage points, the 5-year ratio dip by one percentage point, the 10-year ratio by over 3 percentage points, and the 30-year ratio by just over 2 percentage points. With the expectation that the Fed will cut rates just once this year, we could expect to see muni yields to fall in anticipation of the expected Fed rate cut this fall.

Municipal Supply: The negotiated calendar for the third week of June will total to $6.3 billion with the largest deal of the week being $1.5 billion New York Transportation Development Corporation Special Facilities Revenue Bonds for the JFK International Airport New Terminal One Project. The Second largest deal of the week will be the Public Energy Authority of Kentucky which plans to sell $1.1 billion Gas Supply Revenue Refunding Bonds. The Cleveland Clinic Health System Obligated Group will offer $461 million through the State of Ohio. AmeriVet will be in one issue this week as a Selling-Group-Member which will be the Maryland Department of Housing and Community Development which will sell $42.4 million in Housing Revenue Bonds.