Municipals close light session unchanged; Bi-State Development sells $381.23 million bonds

By Sheri Kasprzak

New York, July 2 - With another session of light trading and primary action, municipal yields were mostly flat on Tuesday, insiders said.

The market closes early Wednesday ahead of the Independence Day holiday on Thursday, and some traders believe the tone will remain the same throughout the week.

"There's not a lot going on, and everyone is kind of riding out the week," a trader said.

"The early close tomorrow and the day off Thursday is setting us up for a pretty slow week overall."

Some issues, however, were trading, including Illinois' general obligation bonds, which priced last week. Alan Schankel, managing director with Janney Montgomery Scott LLC, said Tuesday that the 2038s were trading slightly weaker with blocks trading in the 5.20% range, down from the original yield of 5.65%.

In other market news, investment-grade municipals recovered some of their June losses, said J.R. Rieger, vice president of fixed-income indexes with S&P Dow Jones Indices.

Investment-grade munis, as tracked by the S&P National AMT-Free Municipal Bond index, rebounded 1.93% from a low of negative 4.97% on June 24. Even so, the index recorded a 3.04% month-to-date loss.

MTA sells to retail

Elsewhere, retail investors took $384 million of the Metropolitan Transportation Authority of New York's transportation revenue bonds, said Schankel. The 30-year maturity priced for retail with a 5% coupon to yield 4.70% to the 10-year call, he said.

The authority is offering the bonds through RBC Capital Markets LLC and M.R. Beal & Co.

Proceeds will be used to refinance commercial paper initially issued to finance commuter and transit projects.

Bi-State bonds price

In Tuesday's light primary activity, the Bi-State Development Agency of the Missouri-Illinois Metropolitan District brought $381,225,000 of series 2013A combined lien mass transit sales tax appropriation refunding bonds, said a pricing sheet.

The bonds (Aa3/AA+/) were sold through senior manager RBC Capital Markets.

The bonds are due 2014 to 2025 with term bonds due in 2028, 2033, 2044, 2046, 2048, 2050 and 2052. The serial coupons range from 3% to 5% and yields range from 0.35% to 3.41%.

The 2028 bonds have a 5% coupon priced at 106.882 to yield 3.53%.

The 2033 bonds have a 4.375% coupon priced at 98.609 to yield 4.48% and a 5% coupon priced at 106.107 to yield 4.19%.

The 2044 bonds have a 5% coupon priced at 104.097 to yield 4.45%.

The 2046 bonds have a 4.75% coupon priced at 99.25 to yield 4.795%.

The 2048 bonds have a 4.75% coupon priced at 99.25 to yield 4.795%.

The 2050 bonds have a 4.75% coupon priced at 99.25 to yield 4.793%.

The 2052 bonds have a 4.75% coupon priced at 99.25 to yield 4.792%.

Proceeds will be used to refund the agency's series 2002A-C, 2007 and 2010A revenue bonds.

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