Municipals end busier session unchanged; Pennsylvania hits market with $1.21 billion G.O. bonds

By Sheri Kasprzak

New York, Aug. 9 – Municipals closed Tuesday’s session mostly flat as the new issues for the week started pricing, market sources said.

The 10-year triple-A muni bond yield held steady at 1.49% and the 30-year yield at 2.33%, a trader said in the afternoon.

Meanwhile, a decline for nonfarm productivity in the second quarter led to a boost for Treasuries. The 30-year Treasury bond yield fell by 5 basis points to 2.25%, and the 10-year note yield fell by 4 bps to 1.55%. The five-year and two-year yields also ended the session 4 bps lower at 1.11% and 0.71%, respectively.

Pennsylvania brings G.O. bonds

Headlining the day’s new-issue activity, Pennsylvania priced $1,208,725,000 of second series 2016 general obligation bonds.

The full details of the offering were not available Tuesday evening, but the bonds are due 2017 to 2036 with yields from 0.67% to 3.101%.

The bonds (Aa3/AA-/AA-) were sold competitively, and the proceeds from the sale will be used to finance capital facilities projects.

Louisville sewer bonds price

Elsewhere, the Louisville and Jefferson County Metropolitan Sewer District of Kentucky sold $150 million of series 2016A sewer and drainage system revenue bonds.

The bonds (Aa3/AA) were sold competitively, but the issuer did not immediately respond to requests for the winning bidder.

The bonds are due 2018 to 2043 with term bonds due in 2046 and 2047. The serial coupons range from 3% to 5% with yields from 0.65% to 3.15%. The 2046 bonds have a 3% coupon and priced at 96.553 to yield 3.18%, and the 2047 bonds have a 3% coupon and priced at 96.104 to yield 3.20%.

Proceeds will be used to finance capital improvements to the metropolitan area’s sewer and drainage system and to refund the district’s series 2008A and 2009A-B revenue bonds.

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