Municipals quiet ahead of $1.2 billion California deal; Connecticut offers $550 million

By Cristal Cody

Tupelo, Miss., Nov. 12 – Municipal bonds ended unchanged in light trading on Wednesday following the Veterans Day holiday, market sources said.

“Munis are pretty quiet,” a trader said. “There’s the big California deal tomorrow. It just seems like retail is not enamored with rates right now. They’ve been on the sidelines for what seems like three weeks.”

Treasuries were little changed on Wednesday with the 10-year benchmark Treasury note yield flat at 2.36%. The five-year note yield held unchanged at 1.64%. The 30-year bond yield fell 1.2 basis points to 3.08%.

The State of California plans to price $1,204,325,000 of various purpose general obligation bonds (Aa3/A/A) via a competitive offering on Thursday, according to a preliminary official statement.

The deal includes $270 million of federally taxable G.O. bonds, $304,325,000 of tax-exempt G.O. refunding bonds $630 million of tax-exempt G.O. bonds.

Public Resources Advisory Group is the financial adviser.

Proceeds will be used to fund projects and pay certain of the state’s outstanding taxable G.O. commercial paper notes.

Connecticut preps G.O. bonds

Coming up in the deal pipeline, the State of Connecticut plans to price $550 million of G.O. bonds, according to a preliminary official statement.

The deal includes $240 million of series 2014F G.O. bonds, $60 million of series 2014G G.O. green bonds and $250 million of series 2014H G.O. refunding bonds.

The series 2014F bonds are due 2015 through 2043; the series 2014G bonds are due 2028 through 2031; and the series 2014H bonds are due 2016 through 2026.

J.P. Morgan Securities LLC is the bookrunner for the negotiated offering.

Proceeds from the offering will be used to finance state projects, including clean water projects, and to refund outstanding bonds.

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