Municipals close weak to flat; New York State Urban Development set to price $1.14 billion

By Sheri Kasprzak

New York, Dec. 7 – Municipals edged lower in spots as the week’s new-issue action got under way, market insiders reported.

Shorter maturities saw yields rise by about 1 basis point while longer maturities were unchanged. The 30-year yield held steady at 3.04%, and the 10-year yield rose by 1 bp to 2.05%.

The week will provide about $9.4 billion of supply led by a $1.14 billion offering from the New York State Urban Development Corp. on Tuesday.

Last week, tax-free yields were 6 bps to 8 bps lower out long with shorter yields slightly higher ahead of next week’s rate hike decision from the Federal Open Market Committee. The consensus among market sources has long been that the Fed will increase interest rates starting at its December meeting.

New York Urban bonds ahead

Looking ahead to that supply, the New York State Urban Development Corp. is scheduled to sell $1,143,580,000 of state personal income tax revenue bonds.

The bonds will be offered competitively, and proceeds will be used to finance capital projects and refund existing debt.

The deal includes $906.02 million of series 2015A bonds due 2016 to 2045 and $237.56 million of series 2015B taxable bonds due 2017 to 2021.

New York City housing deal set

In other new issues, the New York City Housing Development Corp. is in the market this week with $428,055,000 in a five-tranche offering.

The bonds will be sold through a syndicate led by J.P. Morgan Securities LLC.

The deal includes $180,725,000 of series 2015G bonds, $136.47 million of series 2015H term bonds, $60.86 million of series 2015I term bonds, $40 million of series 2015J term bonds and $10 million of series 2015K term rate bonds.

Proceeds will be used to finance mortgage loans for multifamily housing projects in New York City.

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