Municipals end weaker as Treasuries decline; Massachusetts Port, Louisiana prepare new issues

By Sheri Kasprzak

New York, July 3 – Municipals rounded out the holiday-shortened week a touch softer, following along with weaker Treasuries, market insiders reported. Yields were higher by about 1 basis point to 2 bps across the yield curve.

Treasuries were weaker as well, with the five-year note yield climbing by 2.5 bps to end the day at 1.737%. The 30-year bond yield climbed by 1 bp to 3.479%, and the 10-year note yield rose by 1.5 bps to 2.645%.

Treasuries didn’t really respond to nonfarm payroll numbers for June, seeking instead stronger evidence that the Fed might hike its short-term interest rate soon.

Meanwhile, municipals had little to push the market, with extremely light trading action and almost no pricing going on the day before the July 4th holiday.

Massachusetts Port deal set

The new-issue calendar in the week ahead will pick up somewhat. New issuance will be led by a $251.73 million offering from the Massachusetts Port Authority. The authority will price the revenue bonds (Aa3/AA-/AA) through senior manager Raymond James/Morgan Keegan on Wednesday.

The deal includes $45,715,000 of series 2014A non-AMT bonds, $48,915,000 of series 2014B AMT bonds and $157.1 million of series 2014C non-AMT refunding bonds.

Proceeds from the deal will be used to refund the authority’s series 2012A commercial paper notes and its series 2003A, 2003C and 2005A revenue bonds.

Louisiana organizes sale

Also coming up on Wednesday, the State of Louisiana is scheduled to price $238.02 million of series 2014B gasoline and fuels tax revenue refunding bonds (Aa1/AA/) through Morgan Stanley & Co. LLC, Goldman Sachs & Co. and Loop Capital Markets LLC.

The bonds are due 2017 and 2027 to 2036 with a term bond due in 2039.

Proceeds will be used to refund the state’s series 2005A and 2006A gasoline and fuels tax revenue bonds.

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