Municipals decline with Treasuries; Pennsylvania sells $1 billion G.O.s; Tampa Bay bonds price

By Sheri Kasprzak

New York, Feb. 3 – Municipals slipped on the session, falling but outperforming Treasuries, market sources said. A weak Japanese government debt auction sent Treasuries into a selloff, shoving yields up and taking municipals with it.

Muni yields were seen higher by 7 to 8 basis points, said a market insider during the afternoon. The 30-year Treasury bond yield, meanwhile, jumped 12 bps. The 10-year Treasury note yield climbed 11 bps.

Meanwhile, new-issue action got under way, led by a $1 billion offering from the Commonwealth of Pennsylvania.

Pennsylvania brings debt

That Pennsylvania deal was postponed last week due to a snowstorm.

The bonds are due 2016 to 2035 with 4% to 5% coupons. The full details of the offering were not immediately available Tuesday.

Proceeds will be used to finance capital projects.

Tampa Bay sells offering

Also during the day, the Tampa Bay Regional Water Authority of Florida came to market with $264.22 million of series 2015 utility system refunding revenue bonds.

The deal included $167,945,000 of series 2015A bonds and $96,275,000 of series 2015B taxable bonds, said a pricing sheet.

The 2015A bonds are due 2025 to 2036 with 4% to 5% coupons.

The 2015B bonds are due 2015 to 2031 with 0.3% to 3.332% coupons, all priced at par.

The bonds (Aa1/AA+/AA+) were sold on a negotiated basis with Citigroup Global Markets Inc. as the senior manager for the 2015A bonds and Raymond James/Morgan Keegan leading the syndicate for the 2015B bonds.

Proceeds will be used to refund the authority’s series 2006 and 2011A-B revenue bonds.

Pocono offering trades

Looking to secondary action, the Pocono Mountains Industrial Park Authority’s bonds for St. Luke’s Hospital were seen actively traded during the session Tuesday.

The 4% 2045s were seen trading at 3.758% after pricing last week at a 3.97% yield.

Elsewhere, Tulsa, Okla.’s G.O.s were trading higher. The 3.125% 2037 bonds were seen trading Tuesday at 3.269%. The bonds priced last week at a 3.3% yield.

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