NEW YORK Municipal bonds were little changed in early afternoon while underwriters priced $850 million Wisconsin general fund annual appropriation taxable bonds with a top yield of 5.72% in 2026.
Governments were narrowly mixed, paring early gains while equities were also mixed.
Meantime, the U.S. Treasury auctioned $16 billion of five-year notes as 3 3/8s, a 3.375% high yield, a price of par. The bid-to-cover ratio was 1.92.
In recent trading, the two-year Treasury note was quoted up 1/32 to yield 1.94%, the 10-year note was quoted up 1/32 to yield 4.35%, and the 30-year bond was quoted down 1/32 to yield 5.16%.
In the municipal arena, cash bond yields were little changed in an indifferent market.
It was trying to do better earlier, but now its not doing much of anything, a trader in Chicago said.
Meanwhile, traders reported underlying caution in the market due to uncertainty about future actions of the Federal Reserve and overall market direction.
Apprenhension has been here for a good three to six months because people dont know what the Fed is going to do, a trader in New York said. Then all of a sudden people have an accumulation of cash so they run out and spend it. A lot of people expect the market to go down but it never seems to and then they finally throw in the towel and buy something. If you have a lot of cash then youre more nervous because you have to invest.
Nevertheless, traders said municipals were encouraged by the lack of supply and anticipated demand from Jan. 1 reinvestment cash.
There arent many bonds around and were not going to see a lot more coming between now and the second week in January, a trader in New York said. People will probably need some more inventory going into year-end but no one is giving anything away. People have offerings that are high and bids that are cheap so with spreads like that I cant get anything done.
In the new issue market, UBS Financial Services priced $850 million Wisconsin general fund annual appropriation taxable bonds with a top yield fo 5.724% in 2026.
The issue is insured by Financial Security Assurance and carries underlying ratings of Aa1 from Moodys Investors Service, A-plus from Standard & Poors and AA-minus from Fitch Ratings.
Meantime, Citigroup Global Markets priced and repriced $127 million Westchester, N.Y., bonds.
Series 2003B containing $44 million was priced to yield from 1.37% in 2005 to 4.15% in 2018. Series 2003C comprising $6 million was priced to yield from 1.37% in 2005 to 3.58% in 2013. Series 2003D containing $60 million was priced to yield from 1.37% in 2005 to 3.95% in 2016. Series 2004 containing $4 million and subject to alternative minimum tax was priced to yield from 2.40% in 2005 to 4.41% in 2014. Finally, series 2003B notes contained $12 million taxable general obligation pension bond anticipation notes.
All series are natural triple-A rated by Moodys, Standard & Poors and Fitch.
In addition, Merrill Lynch priced $125 million State of New York Mortgage Agency homeowner mortgage revenue bonds, subject to alternative minimum tax. Serials were priced at par to yield from 1.75% in 2005 to 4.60% in 2017. Bonds due 2023, 2028 and 2034 were not reoffered.
The issue is rated Aa1 by Moodys.
Also, Lehman Brothers priced and repriced $100 million SONYMA homeowner mortgage revenue bonds. At a repricing yields were lowered by five basis points in 2007. The final scale comprised serials priced to yield from 1.20% in 2004 to 4.40% in 2017.
The issue is rated Aa1 by Moodys.
Finally, First Albany Corp. priced and repriced $115 million Ohio major new state infrastructure project revenue bonds following a retail order period yesterday. Serials were priced to yield from 1.37% in 2005 to 3.35% in 2011.
The issue is rated Aa3 by Moodys, AA by Standard & Poors and AA-minus by Fitch.
Looking ahead, to new issue volume, The Bond Buyer's 30-day visible supply calendar fell $1.17 billion to $9 billion. The total comprises $1.42 billion of competitive loans and $7.57 billion in negotiated issues.
Disclosure
The Municipal Securities Rulemaking Board reported 31,817 trades Tuesday comprising 13,444 separate issues. Of all bonds traded, 1,752 changed hands at least four times. Most active was Florissant, Mo., Industrial Development Authority revenue refunding tax increment 5 5/8s of 2024, which traded 443 times at a high of 101.41, a low of 99.
