Ceasefire doesn't move muni yields

Munis were little changed Thursday, as U.S. Treasuries grew slightly cheaper and equities were up.

News of a 10-day ceasefire between Israel and Lebanon may have reassured investors, said James Pruskowski, managing director at Hennion & Walsh, but it didn't cause munis to richen Thursday. Relieving the uncertainty in the conflict has put greater focus on oil prices, Pruskowski said, which are "stubbornly coming off local lows."

"Headline risk has overshadowed fundamentals and technicals in the market," Pruskowski said. "Conviction looks pretty weak. All in all, as you analyze volumes, it appears real money is still largely on the sidelines."

New-issue calendar
In the primary market, BofA Securities priced for Hawaii (Aa2/AAA//) $439.38 million of highway revenue bonds. The first tranche, $279.85 million of Series 2026A, saw 5s of 1/2030 at 2.5%, 5s of 2031 at 2.60%, 5s of 2036 at 3.07%, 5s of 2041 at 3.5%, and 5s of 2046 at 4.05%, callable 1/1/2036.

The second tranche, $159.53 million of Series 2026B, saw 5s of 1/2027 at 2.38%, 5s of 2031 at 2.60%, and 5s of 2036 at 3.07%, noncall.

In the competitive market, Louisiana (Aa2/AA//AA/) sold to BofA Securities $348.715 million of GOs, Series 2026A, with 5s of 5/2027 at 2.35%, 6s of 2031 at 2.61%, 5s of 2036 at 3.08%, 5s of 2041 at 3.51%, and 4s of 2046 at 4.186%, callable 5/1/2036.

Fund flows
Investors pulled $427.5 million from municipal bond mutual funds in the week ended Wednesday, following $865.8 million of inflows the prior week, according to LSEG Lipper data.

High-yield funds saw inflows of $74.8 million compared to inflows of $50 million the previous week.

Tax-exempt municipal money market funds saw outflows of $4.038 billion for the week ending April 13, bringing total assets to $142.992 billion, according to the Money Fund Report, a weekly publication of EPFR.

The average seven-day simple yield for all tax-free and municipal money-market funds was 2.36%.

Taxable money-fund assets saw $147.688 billion pulled, bringing the total to $7.502 trillion.

The average seven-day simple yield was 3.33%.

The SIFMA Swap Index was at 3.65% on Wednesday compared to the previous week's 2.81%.