Municipals end unchanged during light trading session; week's new issues to total $5.2 billion

By Sheri Kasprzak

New York, May 27 - Municipals rounded out a quiet session unmoved on Tuesday amid very light trading action after the Memorial Day holiday, said market sources.

Yields were mostly flat on the session, with another week of light supply ahead and amid mixed action for Treasuries.

Municipals finally lost ground at the end of last week after weeks of rallying, market insiders said.

The MMA triple-A 5% index yields ended 5 basis points higher at 3.48% in 30 years and up 2 bps at 2.21% in 10 years.

On Friday, ahead of the Memorial Day weekend, trading activity was just $5.3 billion, one of the lightest sessions since January.

New issue volume for the short week is estimated at $5.2 billion, and issuance will be dominated by utility and airport offerings.

Chicago Midway deal set

Heading up those offerings is $784,025,000 of series 2014 second-lien revenue and refunding bonds from the City of Chicago for the Chicago Midway Airport.

The deal includes $480.57 million of series 2014A AMT bonds and $303,455,000 of series 2014B non-AMT bonds.

The bonds will be sold through Barclays.

Proceeds will be used to reimburse the airport for costs associated with 2004 renovations and improvements, to refund existing debt and to repay commercial paper notes.

Massachusetts water bonds ahead

Elsewhere during the week, the Massachusetts Water Pollution Abatement Trust is set to sell $561.24 million of series 2014 state revolving fund refunding bonds on Thursday.

The bonds will be sold through BofA Merrill Lynch and are due 2015 to 2031.

Proceeds from the sale will be used to refund the trust's series 4, series 9, series 10, series 12, series 13 and series 14 pool program bonds, its series 1998A loan program bonds and its series 2004B pool program refunding bonds.

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