Munis end week mostly firmer ahead of much-slower week; New Jersey, Fulton County deals ahead

By Sheri Kasprzak

New York, April 26 - Municipals rounded out a busy week on a firmer note, market sources said, with supply dwindling and Treasuries improving.

"We are moving in sympathy with Treasuries, but everything has pretty much priced, so we're just sitting back to see what happens next week," a trader said late in the day.

"We'll hit a supply slump [next week]. I don't want to make any assumptions about what will happen [with yields]. I do think demand is still fairly strong, but it's too early to tell. There are just too many other factors to consider."

Meanwhile, the week ahead will offer about $5 billion of new issues, compared with about $8 billion priced in the week just ended.

"New issue volume, which began the month with $10 billion weeks, has been slowing, with next week's slate currently totaling under $5 billion," said Alan Schankel, managing director with Janney Montgomery Scott LLC.

"Lipper reported an eighth consecutive week of outflows from municipal mutual funds in the week ending April 24 with $102 million exiting the funds, but the pace seems to be slowing, perhaps reflecting less need of redemptions to pay taxes post April 15."

Philadelphia to sell gas works

In a move that could result in the city defeasing and redeeming $1.1 billion of outstanding municipal bonds, the City of Philadelphia has hired JPMorgan Chase & Co. and Loop Capital Markets LLC to broker the potential sale of its gas works utility.

The process, a market insider said, could take a year.

New Jersey deal set

Heading up the week's new issues, the State of New Jersey will come to market on Wednesday with $350 million of series 2013 various purpose general obligation bonds.

The offering had been expected to price earlier in the week, but the state chose to push it back given the fact that the New Jersey Transportation Authority and the New Jersey Turnpike Authority both hit the market recently with large offerings.

Those bonds are due 2014 to 2033, and proceeds from the deal will be used to finance various capital projects within the state.

Fulton note deal ahead

Also on Wednesday, Fulton County, Ga., is expected to price $200 million of series 2013 general fund tax anticipation notes (/SP-1+/F1+).

The notes will be sold competitively and are due Dec. 31, 2013.

Proceeds will be used to finance capital needs ahead of the collection of taxes.

© 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.