Municipals close mostly flat amid very light secondary; Los Angeles preps $1.36 billion deal

By Sheri Kasprzak

New York, June 20 – Municipals were mostly unchanged at the end of the session Friday amid light trading activity, said traders.

“Secondary is very quiet,” said a trader reached late in the afternoon.

Some cheapness was evident early in the session, but as the day progressed, yields stabilized.

This was in contrast to the Treasuries market, which experienced a boost at the end of the week. The 10-year note yield fell by 1 basis point, and the 30-year bond yield fell by 2.5 bps.

Municipals largely ignored Treasuries during the week as the focus turned to absorption of recent offerings and a new slate of deals.

Los Angeles TRANs ahead

Speaking of new deals, the week ahead will offer a slightly elevated calendar led by a $1,363,520,000 sale of tax and revenue anticipation notes from the City of Los Angeles.

The notes (MIG 1/SP-1+/F1+), which are due June 25, 2015, will be offered during the week through senior manager Ramirez & Co. Inc.

Proceeds will be used to finance capital projects for the city.

Washington preps sale

Another billion-dollar offering comes from the State of Washington, which is scheduled to bring to market $1,199,215,000 of series 2015 general obligation bonds (Aa1/AA+/AA+) through both competitive and negotiated sales on Wednesday.

That deal includes $192,005,000 of series 2015A-1 various purpose G.O. bonds, $39 million of series 2015A-2 variable purpose G.O. bonds, $445.23 million of series R-2015A variable purpose G.O. refunding bonds, $437 million of series R-2015B motor vehicle fuel tax G.O. refunding bonds and $85.98 million of taxable series 2015T various purpose G.O. bonds.

BofA Merrill Lynch is the senior manager for the 2015A-2 bonds, and Montague De Rose & Associates LLC, Piper Jaffray & Co. and Seattle-Northwest Co. will be the financial advisers for the remainder of the bonds.

Proceeds will be used to finance capital projects, including new school construction, and to refund existing G.O. debt.

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