Munis end the week unchanged; Monday to kick off massive week of new sales with several deals

By Aaron Hochman-Zimmerman and Sheri Kasprzak

New York, May 29 - After experiencing weakness throughout the week, municipals stayed fairly steady on Friday ahead of a major week for new sales, market insiders said.

"I was surprised to see how much Treasuries were up," a trader said.

Perhaps a lot of the fluctuations were a result of the Treasury auction, the trader noted.

"Maybe we ride the rollercoaster down again," he said.

"It looked like the market was going to fall off the cliff [during the middle of last week]," he said, even as some optimism may be creeping back to the trading desks.

Another trader said the coming week is likely to be so focused on primary action that investors will likely ignore secondary.

"Next week is all about primary," he said on Friday.

"It's going to be a ghost town [for secondary], because we are in for an absolute glut of deals."

The action will be led by a $600 million sale of series 2009S-5 building aid revenue bonds from the New York Transitional Finance Authority.

Citigroup Global Markets Inc. and Goldman, Sachs & Co. are the lead managers.

The bonds are due 2011 to 2029 with term bonds due 2034 and 2039.

Proceeds will be used to pay a portion of costs related to the authority's five-year building plan.

Even Monday, which is a notoriously slow day for pricings, will include a healthy calendar of offerings.

The Virginia Resource Authority, the New Hampshire Health and Educational Facilities Authority for Dartmouth College, the State of Maine and the Unified School District No. 457 in Garden City, Kan., are all set to price bonds on Monday.

New Hampshire HEFA sale

Looking ahead, the previously mentioned New Hampshire Health and Educational Facilities Authority is set on Monday to sell $196.965 million in series 2009 private university revenue bonds for Dartmouth College, said a sales calendar.

The bonds (Aa1/AA+/) will be sold through senior manager Morgan Stanley & Co. Inc.

Proceeds will be used to fund capital improvements, including the construction of a new life sciences building, the renovation of a residence hall and the maintenance of the college's Memorial Stadium.

The college is located in Hanover.

Also coming up during the week, the Greater Orlando Aviation Authority of Florida is scheduled to price $150 million in series 2009 airport facilities refunding revenue bonds Wednesday, according to a sales calendar.

The bonds (Aa3/A+/AA+) will be sold through senior manager Merrill Lynch & Co. Inc.

The offering will be conducted in two tranches.

Proceeds will be used to refund the authority's series 2002E airport facilities revenue refunding bonds as well as terminate the series 2002E bond swap agreement.

FirstEnergy sale

Another deal coming up for the week comes from FirstEnergy Corp. of Akron, Ohio, which is set to price $107.5 million in series 2009A bonds Thursday.

The bonds (Baa2/BBB/) will be sold through senior manager J.P. Morgan Securities Inc.

The bonds are due 2016.

Proceeds will be used to pay for utility improvements.

Texas deal ahead

Looking a little farther out, the State of Texas is scheduled to sell $325.725 million in series 2009 general obligation bonds on June 9, said a preliminary official statement.

The sale includes $276.91 million in series 2009C water financial assistance and refunding bonds and $48.815 million in series 2009D water financial assistance and refunding bonds.

The 2009C bonds are due 2010 to 2029 with term bonds due 2034 and 2039. The 2009D bonds are due 2020 to 2029 with a term bond due 2035.

The bonds (Aa1/AA/AA+) will be sold through lead managers JPMorgan and RBC Capital Markets Corp.

Proceeds will be used to refund the state's series 1999A and 1999C bonds.

Secondary stabilizes

As the week came to a close, a weak-toned municipal market ended relatively unmoved Friday, said a trader reached in the late afternoon.

"We're not seeing a lot of movement, which is probably a good thing, since we've been off all week long," the trader said.

"It's been a really quiet day."

The market trended downward all week in line with floundering Treasuries.

In specific trades, Eastern Michigan University's series 2009C revenue bonds were seen moving. The 4% 2022 bonds were seen at 4.36%, and the 4.75% 2027s were trading at 4.79%.

Also seen trading in bulk Friday was the Geisinger Authority of Pennsylvania's series 2009A Geisinger Health System revenue bonds. The 5.125% 2034s were seen at 4.95%. The 5.25% 2039s were seen trading at par.

The Allegheny County Hospital Authority of Pennsylvania watched its University of Pittsburgh Medical Center bonds moving as well. The 5% 2023 bonds were trading at 4.94%.

© 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.