Municipals close weaker to flat ahead of $8 billion calendar; California to offer $2.2 billion

By Sheri Kasprzak

New York, Oct. 21 - Municipals saw little movement on Monday to kick off the week, even as Treasuries weakened, traders reported.

There could be a case made for some weakness in spots, one trader said during the session, but there was little to move the market.

Secondary activity was light, said another trader, as the market waited for a rather large new-issue calendar, which is expected to include about $8 billion of new offerings for the week.

California G.O. bonds ahead

The bulk of that amount will come from a massive $2,189,880,000 offering of series 2013 general obligation bonds from the State of California.

That deal is being conducted in five tranches: $707,705,000 of series 2013 various purpose G.O. bonds, $246.01 million of series 2013 school facilities G.O. bonds, $600 million of series 2013 various purpose G.O. refunding bonds, $450 million of series 2013 mandatory put G.O. bonds and $186,165,000 of series 2013 taxable various purpose G.O. bonds.

The joint bookrunners are Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.

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

New York City Transitional too

Another major deal set for the week will come from the New York City Transitional Finance Authority, which plans to price $1,092,470,000 of series 2014A future tax secured subordinate bonds in three tranches.

The deal includes $650 million of series 2014A-1 tax-exempt subordinate bonds, $350 million of series 2014A-2 taxable subordinate bonds and $92.47 million of series 2014A-3 taxable qualified school construction bonds.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, Goldman Sachs & Co., Barclays, Loop Capital Markets LLC, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the senior managers for the offering.

Proceeds will be used to finance general city capital expenditures, discrete capital expenditures and the construction, rehabilitation or repair of public schools.

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