Munis stay quiet as equities and Treasuries see gains

Munis were little changed on Tuesday as the new-issue calendar picked up steam. U.S. Treasuries strengthened further and equities finished higher.

The quiet in the muni market is likely due to geopolitical uncertainties, according to Cooper Howard, director of fixed income strategy at Charles Schwab (SCHW). The government released favorable producer price index data Tuesday morning, but that metric has been less meaningful to investors since the war began, Howard said.

"The bigger issue is: how long and how high is oil going to stay elevated for? And the longer that it continues to stay elevated, the greater likelihood that we continue to see inflation pass through and that should lead to higher longer-term yields," Howard said.

New-issue market
In the new-issue market Tuesday, Jefferies priced for Austin, Texas, (A1/A+//AA-/) $1.15 billion of airport system revenue and refunding bonds. The first tranche, $300.085 million of non-AMT Series 2026A bonds, saw 5s of 11/2027 at 2.42%, 5s of 2031 at 2.78%, 5s of 2036 at 3.26%, 5s of 2041 at 3.63%, 5s of 2046 at 4.20%, 5s of 2051 at 4.53% and 5s of 2056 at 4.65%, callable 11/15/2035.

The second tranche, $850.13 million of AMT Series 2026B bonds, saw 5s of 11/2027 at 2.83%, 5s of 2031 at 3.21%, 5s of 2036 at 3.62%, 5s of 2041 at 3.98%, 5s of 2046 at 4.45%, 5.25s of 2051 at 4.73%, 5s of 2051 at 4.78%, 5.25s of 2056 at 4.83% and 5s of 2056 at 4.88%, callable 11/15/2035.

Morgan Stanley (MS) priced for the Maricopa County Industrial Development Authority, Arizona, (/AA-/AA-/) $457.61 million of revenue bonds (Banner Health), Series 2026A, with 5s of 1/2027 at 2.44%, 5s of 2031 at 2.82% and 5s of 2035 at 3.19%, noncall.

The firm also priced for the issuer $416.995 million of forward delivery bonds (Banner Health), Series 2026D, with 5s of 1/2031 at 3.04%, 5s of 2036 at 3.37%, and 5s of 2038 at 3.66%, noncall.

J.P. Morgan priced for the Miami-Dade County School Board, Florida, (A1///) $360.615 million of certificates of participation, Series 2026A, with 5s of 2/2027 at 2.61%, 5s of 2031 at 2.93% and 5s of 2034 at 3.15%, noncall.

In the competitive market, Long Beach Unified School District (Aa2/AA-//) sold to BofA Securities $402.72 million of general obligation refunding bonds, with 5s 8/2026 at 2.17%, 5s of 2031 at 2.35%, 5s of 2036 at 2.84%, 5s of 2041 at 3.29% and 5s of 2043 at 3.47%, callable 8/1/2036.

Richmond, Virginia, (Aa1/AA+/AAA/), sold to BofA Securities $252.875 million of GO public improvement bonds, Series 2026A, with 5s of 1/2027 at 2.32%, 5s of 2031 at 2.55%, 5s of 2036 at 2.99%, 5s of 2041 at 3.43%, 4s of 2046 at 4.20%, 4s of 2051 at 4.42%, and 4s of 2056 at 4.52%, callable 1/15/2036.