Municipals rally with Treasuries as week’s last deals price; Pennsylvania Turnpike sells bonds

By Sheri Kasprzak

New York, Feb. 11 – Municipal improved by as much as 5 basis points on the session Thursday as Treasuries staged another rally, traders reported.

The 10-year triple-A muni bond yield fell by 5 bps to 1.66%, and the 30-year bond yield declined by 3 bps to 2.70%.

Treasuries got a boost Thursday by continued weakness for oil and stocks. The 10-year benchmark Treasury note yield ended the session 8 bps lower at 1.63%, and the five-year yield fell by 4 bps to 1.11%. The 30-year bond yield shrank by 3 bps to 2.50%, and the two-year note yield fell by 7 bps to 0.64%.

Pennsylvania Turnpike prices

Among the larger offerings priced, the Pennsylvania Turnpike Commission hit the market with $365,135,000 of series 2016 turnpike subordinate revenue refunding bonds.

The bonds (A3//A-) were sold through senior manager Citigroup Global Markets Inc.

The bonds are due 2017 to 2038 with 3% to 5% coupons, according to a term sheet.

Proceeds will be used to refund the commission’s series 2008A-1, 2008B-1, 2009B and 2009D revenue bonds.

U of New Mexico sold deal

Elsewhere during the session, the University of New Mexico offered $168,585,000 of series 2016 subordinate-lien system refunding and improvement revenue bonds.

The bonds (Aa2/AA/) were sold through senior manager RBC Capital Markets LLC.

The deal includes $160.29 million of series 2016A tax-exempt bonds and $8,295,000 of series 2016B taxable bonds.

The 2016A bonds are due 2016 to 2038 with term bonds due in 2041 and 2046. The serial coupons range from 2% to 5% with yields from 0.15% to 3.07%. The 2041 bonds have a 5% coupon and priced at 113.22 to yield 2.99%, and the 2046 bonds have a 5% coupon and priced at 105.764 to yield 3.33%.

The 2016B bonds are due 2016 to 2024 with 0.72% to 2.48% coupons and all priced at par.

Proceeds will be used to construct, equip, acquire, improve and renovate University of New Mexico facilities and refund its series 2007B revenue bonds.

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