AmeriVet Weekly Muni Snapshot

Municipal New Issuance: The negotiated calendar last week had a total volume of just over $8.65 billion with the largest deal being the $1.12 billion New Jersey Health Care Facilities Financing Authority for Robert Wood Johnson Barnabas Health. which AmeriVet served as a Co-Manager on. The next largest deal of the week was the Texas Transportation Commission which issued $877 million. The Nebraska Public Power issued $819 million.

Municipal Secondary Trading: Secondary trading volume for last week totaled to just over $38.04 billion, with 54% of secondary trading being dealer sells. According to Bloomberg (MBWDPAR Index), clients put just over $4.94 billion up for the bid, which is a decrease from the prior week’s bids wanted total of $5.52 billion.

Municipal Spreads: Muni yields were relatively unchanged with yields rising by just .6 basis point across the curve with yields on 10-year notes falling by .6 basis points to end the week at 2.86%. Munis did outperform Treasuries this past week as 10-year muni-to-Treasury ratio is now yielding 66.49%, compared to 67.2% from the prior week. We did see the muni curve flatten by 3.3 basis points to end the week at 199 basis points.

According to LSEG Lipper Global U.S. Fund Flows data, muni bond funds saw investors add approximately $1 billion to muni bond funds this past week. This follows prior week’s outflow of $427 million.

Munis cheapened over the past week, specifically the front end with the 2027-2030 maturities seeing bumps of 2-3 basis points, the 2031-2041 range experienced a 1 basis point bump, and the 2042-2056 maturity range was unchanged for the week. With munis being relatively quiet this week, returns for the month are at 1.50% with the long end seeing the largest gains of 2.30% for the month while the front end is seeing a modest gain of just .19%. This brings the year-to-date returns to 1.32%.

With munis only seeing bumps in the front end, munis did outperform Treasuries over the past week with the 2-year muni-to-Treasury ratio now yielding 60% compared to 61.23% a week ago, the 5 year ratio is now at 61.72% compared to 62.62% from the prior week, the 10 year ratio at 66.49% compared to 67.20% from the prior week, and the 30-year ratio is at 87.53% compared to 88.06% from the prior week.

Municipal Supply: The negotiated calendar for the week will have an expected volume of just over $5.28 billion with the largest deals of the week being the $1.29 billion Massachusetts Development Finance Agency for the Dana-Farber Cancer Institute, followed by the $1.12 billion Energy Northwest issue. The Los Angeles Unified School District which plans on selling $650 million and the Burbank-Pasadena-Glendale Airport Authority plans on selling $379 million of tax-exempt and taxable bonds.

Have a great week!