Municipals little changed to close week; about $3 billion of new offerings in week ahead

By Sheri Kasprzak

New York, July 11 – Municipals ended the session mostly flat to slightly firmer on Friday, market insiders said, as trading activity remained light. Additionally, the market awaits a very subdued new-issue calendar in the week ahead with just $3 billion expected.

There was a somewhat firmer tone to tax-exempts, said a trader, following Treasuries, which were improved on the session amid volatility domestically and abroad.

Even though trading remained light, there were indications that recently softer Puerto Rico paper was trading somewhat better, said a trader.

Yields were seen unchanged to 1 bp lower, the trader added.

The week ahead will prove to be another quiet one with under $3 billion in new offerings slated to hit the market, said Tom Kozlik, municipal credit analyst with Janney Montgomery Scott LLC.

Bay Area Toll deal set

Heading up the meager offerings is a $1,381,915,000 sale from the Bay Area Toll Authority. The authority is slated to price San Francisco Bay area toll bridge bonds (Aa3/AA/AA-).

The deal includes $240,645,000 of series 2014A term-rate bonds, $545.63 million of series 2014B term-rate bonds, $395.64 million of series 2014C term-rate bonds and $200 million of series 2014F-1 fixed-rate bonds.

The bonds will price through senior managers BofA Merrill Lynch and J.P. Morgan Securities LLC.

Proceeds will be used to finance capital projects, as well as to refund the authority’s series 2008F-1 bonds.

Colorado preps notes

Amid the other larger deals, the State of Colorado will come to market on Tuesday with $500 million of series 2014A general fund tax and revenue anticipation notes.

The notes (MIG1/SP-1 /) will be sold competitively and are due June 26, 2015.

Proceeds will be used to finance anticipated general fund cash shortfalls for the 2014-2015 fiscal year.

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