Municipals end quiet session firmer as secondary picks up; new deals led by California debt

By Sheri Kasprzak

New York, Oct. 18 - Municipals were firmer on Friday as secondary action picked up, traders reported.

Yields, said one trader, fell by a basis point or two in spots, and although the overall tone was firm, there was little movement.

"Secondary is pushing the market today," the trader said.

"I think there's a flight to quality. We are seeing a lot of block trades this afternoon, and that's a huge deal seeing as how quiet it's been the past several days."

$7 billion week ahead

Looking to the week ahead, the municipals new-issue calendar will total about $7 billion, including a massive deal from the State of California.

The state plans to price $2,189,880,000 of series 2013 general obligation bonds in five tranches through Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.

Proceeds from the offering will be used to finance capital projects, including the construction of schools within the state.

Minnesota to price

Another major offering set for the coming week will come from the State of Minnesota, which is slated to price $767,555,000 of series 2013 G.O. state bonds.

The bonds will price competitively on Tuesday in three tranches.

The offering includes $282.6 million of series 2013D G.O. state various purpose bonds, $112 million of series 2013E G.O. state trunk highway bonds and $372,955,000 of series 2013F G.O. state various purpose refunding bonds.

Proceeds will be used to finance capital expenditures and the construction of state trunk highway projects and to refund existing G.O. debt.

Dasny brings revenue bonds

One of the largest offerings of the week priced Thursday. The Dormitory Authority of the State of New York released details on its $959,795,000 sale of series 2013A state sales tax revenue bonds in a pricing sheet.

The bonds (/AA/AAA) were offered through senior managers JPMorgan, Citigroup, Loop Capital Markets LLC and RBC Capital Markets LLC.

The bonds are due 2015 to 2030 with term bonds due in 2033, 2034, 2035, 2038 and 2043.

The serial coupons range from 2% to 5% with 0.24% to 4.20% yields.

The 2033 bonds have a 4.125% coupon priced at 97.324 to yield 4.33% and a 5% coupon priced at 106.231 to yield 4.19%. The 2034 bonds have a 5% coupon and priced at 105.753 to yield 4.25%. The 2035 bonds have a 5% coupon and priced at 105.278 to yield 4.31%. The 2038 bonds have a 5% coupon and priced at 104.335 to yield 4.43%. The 2043 bonds have a 4.625% coupon priced at 99.121 to yield 4.68% and a 5% coupon priced at 103.635 to yield 4.52%.

Proceeds will be used to finance capital projects at the State University of New York, fund environmental remediation projects and fund library projects.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.