Muni yields seen flat to slightly firmer; Hawaii sells $721.63 million bonds in upsized sale

By Sheri Kasprzak

New York, Feb. 10 - It might have been sunny and warm in Hawaii Wednesday, but a massive snowstorm in the New York metropolitan area impacted activity in the broader municipal market.

Market insiders reached early Wednesday afternoon said New York-based muni participants were calling it a day early as the region received more than a foot of snow and this might negatively impact the State of Hawaii's sale of general obligation and G.O. refunding bonds.

"It might have an effect," said one sellsider reached during the day.

"If buyers are leaving early or are gone altogether, they might not be able to sell what they had hoped to."

As it turned out, the state actually sold more of the bonds than it originally planned. It brought $721.625 million, a jump from the expected $534.325 million.

The deal included $500 million in series 2010DX G.O. bonds and $221.625 million in series 2010DY G.O. refunding bonds.

The 2010DX bonds are due 2015 to 2030 with 3% to 5.53% coupons, and the 2010DY bonds are due 2015 to 2020 with 3% to 5% coupons.

Citigroup Global Markets Inc. was the senior manager.

The state plans to use the sale to refund several series of existing bonds.

Trading seen light

On the secondary side of the market Wednesday, a trader said very little action was happening, and the expectation in the early afternoon was that the light activity would grind to a halt by the latter part of the trading day.

"We don't expect to see a lot going on this afternoon," said the New York-based trader.

"Everyone is getting out of here as quickly as they can. It's been fairly quiet here anyway, so it's probably going to be dead in a couple of hours."

Amid the light activity, Miami-Dade County, Fla.'s, recently priced Building Better Communities bonds were seen in action. The 4.75% 2039 bonds were seen at 4.683%.

Elsewhere, the Puerto Rico Sales Tax Financing Corp.'s 5.375% 2039s were trading at 5.17%. The 4.375% 2020s were trading at 4%.

Wisconsin sells $202.98 million

In other primary news, the State of Wisconsin priced $202.975 million in series 2010-1 G.O. refunding bonds, according to a pricing sheet.

The bonds were sold through Bank of America Merrill Lynch.

The bonds are due 2012 to 2029 with 2% to 5% coupons.

Proceeds will be used to refund existing debt.

East Bay MUD sale ahead

Looking to Thursday's primary activity, the East Bay Municipal Utility District of California is set to bring $400 million in series 2010 water system revenue bonds (Aa2).

Morgan Stanley & Co. Inc. is the senior manager.

Proceeds from the deal will be used to fund improvements to the district's water system.

The utility district is based in Oakland, Calif.

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