Munis slip; Louisville and Jefferson County Sewer prices; New York Water to offer $375 million

By Cristal Cody

Tupelo, Miss., Nov. 4 – Municipals traded weaker on Tuesday, particularly in the belly and long end of the bond curve, a trader said.

“Munis cut the scale anywhere from 1 to 3 basis points, but it’s extremely quiet,” the trader said. “They’ve cut the scale every single day the last three days.”

Munis cheapened in the five-year and longer-dated maturities, according to the trader.

Treasuries ended modestly better but off gains made earlier in the day on a weaker-than-expected trade deficit. The 10-year benchmark note yield fell 0.6 bps to 2.342%, while the 30-year bond yield declined 1.3 bps to 3.053%.

A heavier muni deal calendar over the week may be behind the quiet secondary activity, the trader said.

Louisville and Jefferson prices

In Tuesday’s primary activity, the Louisville and Jefferson County Metropolitan Sewer District priced $226.34 million of sewer and drainage system subordinated bond anticipation notes, according to a pricing sheet.

The 2% BANs due Nov. 24, 2015 priced at 101.71 to yield 0.28%.

The bonds were offered competitively.

J.J.B. Hilliard, W.L. Lyons, LLC was the financial adviser.

Proceeds will be used to retire outstanding notes on Nov. 26.

New York Municipal Water ahead

In new issuance coming up, the New York City Municipal Water Finance Authority intends to price $375 million of water and sewer system second general resolution revenue bonds, according to a preliminary official statement.

The fiscal 2015 series EE bonds will include two tranches of term maturities.

Ramirez & Co., Inc. is the senior manager of the negotiated sale.

Proceeds will be used to redeem outstanding bonds and for a construction fund.

Erlanger to price

Also on the calendar, the Chattanooga-Hamilton County Hospital Authority plans to bring $148.43 million of hospital revenue and refunding bonds for the Erlanger Health System, according to a preliminary official statement.

The series 2014A bonds (Baa2//BBB) will be offered on a negotiated basis through bookrunners Barclays and FTN Financial Capital Markets.

Proceeds from the deal will be used to finance the acquisition, construction and equipping of hospital facilities and to refund maturities from the outstanding Erlanger Health series 1997A revenue bonds, series 1998A revenue bonds, series 2000 revenue refunding bonds and series 2004 revenue refunding bonds.

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