Municipals improve across curve despite some Treasury weakness; Houston sells airport debt

By Sheri Kasprzak

New York, May 8 - With supply still low, municipals continued to rally on Thursday, market insiders said. Long bonds saw the most improvement even as long Treasuries took a dip.

Short municipal yields fell by about 2 basis points on the day with long bonds outside of 30 years falling by 4 bps.

This is a sharp contrast to Treasuries, where the 30-year bond yield rose by 3 bps to end at 3.433% after 30-year Treasury bonds were auctioned at higher-than-expected yields. The 10-year note yield fell by half a basis point to 2.616%, and the five-year note yield fell by 2 bps to 1.627%.

Houston brings bonds

Moving to the day's pricing action, the City of Houston sold $308.66 million of series 2014 AMT airport system refunding revenue bonds for United Airlines.

The bonds were sold through senior manager Citigroup Global Markets Inc.

The bonds are due 2020, 2024 and 2029, said a pricing sheet. The 2020 bonds have a 4.5% coupon and priced at 99.209 to yield 4.65%, and the 2024 bonds have a 4.75% coupon and priced at 98.814 to yield 4.90%. The 2029 bonds have a 5% coupon and priced at 98.435 to yield 5.15%.

Proceeds will be used to refund existing debt issued for improvements to United Airlines terminals at the Houston George Bush Intercontinental Airport.

Harris County flood bonds price

In other primary action, the Harris County Flood Control District of Texas sold $170,735,000 of series 2014 refunding bonds. The offering was downsized from $195 million.

The deal included $60,285,000 of series 2014A district improvement refunding bonds, $36.7 million of series 2014A district contract tax refunding bonds and $73.75 million of series 2014B taxable district contract tax refunding bonds, said pricing sheets.

The 2014A district improvement bonds are due 2014 and 2025 to 2029 with 5% coupons. The 2014 bonds were not reoffered.

The 2014A contract tax bonds are due 2014 and 2025 to 2026 with 5% coupons. The 2014 bonds were not reoffered.

The 2014B bonds are due 2015 to 2018 with a term bond due in 2024. The serial coupons range from 0.25% to 1.818% and all priced at par. The 2024 bonds have a 3.211% coupon and priced at par.

The bonds (Aaa//AAA) were sold through Jefferies & Co. and Loop Capital Markets LLC.

Proceeds will be used to refund existing debt.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.