NEW YORK - Municipal bonds were little changed while underwriters opened the first day of a two-day retail order period on $1.5 billion California general obligation bonds with a top yield of 5.31% in 2027.
Treasuries faded showing little reaction when September existing home sales rose 3.6% to 6.69 million units and September new home sales fell 0.2% to 1.145 million units.
Recently, the two-year Treasury note was quoted down 2/32 to yield 1.76%, the 10-year note was quoted down 10/32 to yield 4.27%, and the 30-year bond was quoted down 11/32 to yield 5.14%.
Meanwhile the U.S. Treasury is expected to announce details of the upcoming auction of two-year notes at 11 a.m., EDT.
Also ahead, September durable goods orders and the October consumer confidence index are scheduled for release on Tuesday. Weekly jobless claims figures and the advance third quarter gross domestic product report are due on Thursday. Wrapping up the week, September personal income and spending, the University of Michigan final October consumer sentiment index and the Chicago purchasing managers' index are expected on Friday.
Meantime, the Federal Reserve holds a policy-setting meeting tomorrow.
In the municipal sector, cash bonds were little changed while traders said the market was focussed on retail order periods on both $1.5 billion California GOs and $542 million New York City Transitional Finance Authority tax secured bonds.
"It's a quiet start and it looks like bonds down, stocks up," a trader in New York said. "Away from the retail order periods it's just desperately quiet."
In the new issue market, Bank of America opened the first day of a two-day retail order period on $1.5 billion California general obligation bonds with a top yield of 5.31% in 2027 and ahead of institutional pricing Wednesday.
Meantime, Lehman Brothers opened the second day of a retail order period on $542 million New York City Transitional Finance Authority future tax secured bonds ahead of institutional pricing tomorrow. Underwriters received $70 million in retail orders Friday.
Serials were priced to yield from 1.35% in 2005 to 4.77% in 2023. A 2028 maturity containing $112 million was priced as 4.90s to yield 4.92%, and bonds due in 2032 totaling $85 million were priced as 5s to yield 4.97%. A 2004 maturity was subject to a sealed bid.
Moody's Investors Service is expected to rate the issue Aa2, while both Standard & Poor's and Fitch Ratings rate it AA-plus.
Also, Bear Stearns & Co. is expected to price $2 billion Oregon taxable pension obligation bonds either today or tomorrow.
Disclosure
The Municipal Securities Rulemaking Board reported 24,842 trades Friday, comprising 10,254 separate issues. Of all bonds traded, 1,288 changed hands at least four times. Most active was New York 4.30s of 2013, which traded 256 times hitting a high of 100.39, a low of 98.973 and an average of 99.584.
