Munis narrowly mixed, USTs begin to recover

Munis were narrowly mixed on Tuesday amid heavy supply. U.S. Treasury yields fell and equities ended higher following Monday's losses.

Muni yields were changed up to two basis points, while USTs were one to four basis points stronger.

The muni market has been digesting Tuesday's deals as analysts expected, according to Tim Iltz, fixed-income credit and market analyst at HJ Sims.

"Our impression of the deals that we've been seeing is that they're not necessarily oversubscribed," Iltz said, but "we haven't seen any concerns with regard to the market not being able to take down the bonds that are being put out there."

Meanwhile, investors have been trying to decide how seriously to take news that the ceasefire in Iran will hold and predict how the headlines will impact interest rates, Iltz said.

New-issue market
In the primary market Tuesday, Wells Fargo (WFC) priced for the Board of Regents of the Texas State University System (Aa2//AA/) a $727.66 million deal. The first tranche, $569.16 million of revenue financing system revenue and refunding bonds, Series 2026A, saw 5s of 3/2027 at 2.69%, 5s of 2031 at 2.89%, 5s of 2036 at 3.23%, 5s of 2041 at 3.72%, 5s of 2046 at 4.18%, 5s of 2051 at 4.55%, and 5.25s of 2056 at 4.62%, callable 3/2036.

The second tranche, $158.5 million of forward delivery revenue financing system refunding bonds, Series 2026C, with 5s of 3/2027 at 3.12%, 5s of 2031 at 3.15% and 5s of 2036 at 3.55%, noncall.

BofA Securities priced for the Economic Development Authority of Lynchburg, Virginia (A3//A/), $397.18 million of hospital revenue bonds, on behalf of the Centra Health Obligated Group. The first tranche, $210.175 million of Series 2026A, saw 5s of 1/2040 at 4.07%, 5s of 2041 at 4.16%, 5.25s of 2046 at 4.49%, 5.5s of 2051 at 4.73% and 5.5s of 2056 at 4.84%, callable 1/2036.

The second tranche, $87.005 million of Series 2026B, saw 5s of 1/2027 at 3.05%, 5s of 2031 at 3.18%, 5s of 2037 at 3.77% and 5s of 2041 at 4.16%, callable 1/2036.

The third tranche, $100 million of Series 2026C, saw 5s of 1/2032 at 3.26%, callable 10/2031, and 5s of 2036 at 3.61%, callable 10/2035.

J.P. Morgan priced for the Indiana Municipal Power Agency (A1/A+/A+/) $393.205 million of power supply system refunding revenue bonds, Series 2026A, with 5s of 1/2033 at 3.08%, 5s of 2036 at 3.32%, 5s of 2041 at 3.79%, and 5s of 2042 at 3.87%, callable 7/2035.

In the competitive market, Washington (Aaa/AA+/AA+/) sold $424.05 million of various purpose general obligation refunding bonds, Series R-2026C, to Morgan Stanley (MS), with 5s of 8/2030 at 2.70%, 5s of 2031 at 2.78%, 5s of 2036 at 3.16% and 5s of 2041 at 3.55%, callable 8/2036.

The state sold $240.315 million of motor vehicle, fuel tax and vehicle-related fees GO refunding bonds, Series R-2026D, to Morgan Stanley (MS), with 5s of 2027 at 2.62%, 5s of 2031 at 2.78%, 5s of 2036 at 3.16% and 5s of 2041 at 3.55%, callable 8/2036.

Additionally, Washington sold $124.66 million of various purpose GO refunding bonds, Series R-2026C to BofA Securities, with 5s of 8/2026 at 2.65% and 5s of 2029 at 2.60%, noncall.