Munis and USTs richen, buoyed by optimism on Iran

Munis richened on Wednesday as positive headlines from Iran pushed U.S. Treasury yields lower and equities strengthened.

Muni yields were up to three basis points firmer, and UST yields fell by up to eight basis points.

Wednesday was a smaller day for issuance than Tuesday and began with a large bids wanted list, noted Jennifer Johnston, director of municipal bond research for Franklin Templeton. The market's ability to digest heavy supply days like Tuesday is a good sign as markets are rocked by volatility, she said.

"Everything is up today based on news that perhaps we're going to see some kind of agreement in Iran," Johnston said. "We know that this volatility can continue to occur any day, so we'll see if this becomes a trend. Oil's down. So, all good signs."

ICI reports
The Investment Company Institute Wednesday reported inflows of $1.364 billion for the week ending April 29, following $1.528 billion of inflows the previous week.

Exchange-traded funds saw inflows of $891 million after $1.352 billion of inflows the week prior, per ICI data.

New-issue market
In the primary market Wednesday, Wells Fargo (WFC) priced for the Southern California Public Power Authority (Aa3//AA-/) $589.3 million of transmission system renewal project revenue bonds, Series 2026-1, with 5s of 7/2027 at 2.84%, 5s of 2031 at 3.00%, 5s of 2036 at 3.39%, 5s of 2041 at 3.81%, 5s of 2046 at 4.29%, 5s of 2050 at 4.60% and 5.25s of 2053 at 4.62%, callable 7/2036.

BofA Securities priced for the San Diego Public Facilities Financing Authority (/AA/AA/) $493.075 million of subordinated sewer revenue bonds. The first tranche, $464.545 million, saw 5s of 5/2027 at 2.38%, 5s of 2031 at 2.49%, 5s of 2036 at 2.95%, 5s of 2041 at 3.37%, 5s of 2046 at 3.93%, 5s of 2051 at 4.21% and 5s of 2056 at 4.33%, callable 5/2036.

The second tranche, $28.53 million, saw 5s of 5/2028 at 2.37%, noncall.