Munis rally along with Treasuries on weak stocks; $6.6 billion of supply is led by Chicago BOE

By Sheri Kasprzak

New York, Jan. 15 – Municipals rounded out the week stronger with Treasuries following a substantial stock slump as oil prices fell under $30 per barrel.

Yields on top-rated munis fell by as much as 4 basis points with the 10-year benchmark muni bond yield falling by 2 bps to 1.85% and the 30-year yield ending 4 bps lower at 2.79%, traders said.

Meanwhile, the 30-year Treasury bond yield dove by 9 bps, and the 10-year note yield drifted lower by 7 bps.

Looking ahead to the Martin Luther King Jr. holiday-shortened week, new-issue action will remain robust with about $6.6 billion on tap.

Chicago BOE headlines

The Chicago Board of Education will be the headliner for the week with an $875 million offering of general obligation bonds.

News of the offering comes on the same day Standard & Poor’s downgraded the board’s G.O. debt to B+ from BB.

The offering is comprised of $795,515,000 of series 2016A bonds and $79,485,000 of series 2016B taxable bonds.

The 2016A bonds are due 2035, 2040 and 2044. The 2016B bonds are due Dec. 1, 2033.

The bonds will be sold via J.P. Morgan Securities LLC and Barclays.

Proceeds will be used to finance capital improvements throughout the district and to refund variable-rate debt and other bonds.

Triborough readies deal

Also on the calendar in the week ahead, the Triborough Bridge and Tunnel Authority of New York is set to price $300 million of general revenue bonds on Thursday.

Citigroup Global Markets Inc., Academy Securities Inc. and Cabrera Capital Markets LLC lead the syndicate selling the bonds, which are due 2016 to 2036.

Proceeds are earmarked for bridge and tunnel projects and, depending upon market conditions, refinancing existing debt.

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