Muni Bonds Fall Amid Selling Pressure

The new-issue calendar followed up a larger-than-average Monday state with an even bigger range of bonds today. Several retail order periods that began yesterday offered bonds again to individuals, most with yield increases in the 5- to 10-year range. The largely watched Maryland issuance was able to sell bonds of its bonds to retail Friday and Monday and has now transferred a few remaining bonds to a competitive deal set to have a silent auction tomorrow at 11:00 am EST.

Major new issues priced Tuesday:

$413 million state revolving fund bonds for the Massachusetts Water Pollution Abatement Trust; Aaa/AAA/AAA; for retail customers only.

$411 million tax-exempt general obligation bonds for New York; Aa3/AA/AA; retail only.

$400 million building aid revenue bonds for the New York City Transitional Finance Authority; A1/AA-/A+; retail only.

$397 million general obligation bonds for Utah; Aaa/AAA/AAA; retail only.

While last week this 5-day trailing chart showed principal losses in the 10-year sector, yield increases have now spread to most parts of the yield curve as the market has been burdened with primary and secondary selling pressure along with a pronounced correction from early February's impressive gains:

One Week Change in Municipal Yields, by maturity (bps) Municipal Market Advisors

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