Municipals were weaker Monday, as U.S. Treasury yields rose and equities ended up.

The 2-year municipal to UST ratio Monday was at 66%, the five-year at 69%, the 10-year at 73% and the 30-year at 89%, in line with Municipal Market Data’s 3 p.m. EDT read. ICE Data Services had the two-year at 67%, the five-year at 70%, the 10-year at 74% and the 30-year at 91% at 4 p.m.

The continued onslaught of sturdy recent issuance and UST volatility “further hindered muni performance for the month, however the market began to firm up by the top of the [last] week,” said Birch Creek strategists.

Nevertheless, that could be short-lived as munis were weaker Monday, with yields cut as much as 4 basis points, depending on the curve. UST yields rose even further, with yields moving higher seven to nine basis points.

Then again, lighter supply, at an estimated $7.9 billion this week, and still-attractive valuations should allow for solid muni performance this week, said J.P. Morgan strategists, led by Peter DeGroot.

Muni mutual funds saw outflows of $216.4 million last week as investors “proceed to tug their investments as a consequence of higher yields in addition to selling during tax season,” said Jason Wong, vp of municipals at AmeriVet Securities.

Nevertheless, those outflows were “relatively manageable” and the market managed to generate a good week of absolute performance, said Daryl Clements, a muni portfolio manager at AllianceBernstein.

Particularly, he noted, after a notable period of underperformance the long end of the muni curve found some support last week, with 30-year after-tax spreads tightening by three basis points.

“Longer maturities proceed to look quite attractive, although valuations are compelling across the complete curve,” Clements said. “That said, given consistent rate volatility, paired with a comparatively lackluster flow environment and elevated supply expected to proceed, we might not be surprised if valuations remain attractive for the following few weeks.”

The benchmark AAA muni curve saw yields stand up to 2 basis points out to 10 years but fell by five basis points in 30 years, besting treasuries within the longest maturities, Birch Creek strategists said.

By Wednesday afternoon, “after treasuries staged a powerful rally post-Fed and the muni market was unchanged to weaker across the curve,” the 10-year MMD-UST ratio ended the trading session at its highest level since September 2023, while the 30-year ratio was its widest since March 2023, they said.

“The relative cheapness appeared to spark a renewed interest within the asset class,” as dealers noted a broadening of the client base, with accounts appearing to “slowly come out of their hiding spots, causing customer purchases to leap by 20%,” Birch Creek strategists said.

MMD yields were bumped two to 4 basis points 20 years and in last week, seeing their first positive session of the month, they noted.

The $2 billion NY Dorm PIT competitive deal saw “a dealer step up with solid levels and a lot of the balances sold by the top of the week,” in line with Birch Creek strategists.

“Accounts looked ahead to next week’s light primary calendar, which helped boost spirits further,” they said.

AAA scales
MMD’s scale was cut two basis points throughout a lot of the curve: The one-year was at 2.62% (unch) and a couple of.65% (+2) in two years. The five-year was at 2.82% (+2), the 10-year at 3.15% (+2) and the 30-year at 4.16% (unch) at 3 p.m.

The ICE AAA yield curve was cut two to 4 basis points: 2.69% (+2) in 2026 and a couple of.67% (+2) in 2027. The five-year was at 2.83% (+2), the 10-year was at 3.15% (+3) and the 30-year was at 4.17% (+3) at 4 p.m.

The S&P Global Market Intelligence municipal curve cut as much as a basis point: The one-year was at 2.62% (unch) in 2025 and a couple of.64% (+1) in 2026. The five-year was at 2.81% (+1), the 10-year was at 3.13% (+1) and the 30-year yield was at 4.16% (unch) at 4 p.m.

Bloomberg BVAL cut one to a few basis points: 2.54% (+1) in 2025 and a couple of.62% (+1) in 2026. The five-year at 2.78% (+2), the 10-year at 3.08% (+3) and the 30-year at 4.14% (+2) at 4 p.m.

Treasuries were weaker.

The 2-year UST was yielding 4.032% (+8), the three-year was at 4.011% (+9), the five-year at 4.09% (+9), the 10-year at 4.330% (+8), the 20-year at 4.686% (+7) and the 30-year at 4.658% (+7) near the close.

Primary to come back
The Department of Airports of the City of Los Angeles (Aa3//AA-/) is ready to cost Thursday on behalf of the Los Angeles International Airport a $1.534 billion deal, consisting of $1.189 billion of green private activity/AMT subordinate revenue and refunding revenue bonds, serials 2026-2045, terms 2050, 2055; $175.58 million of personal activity/AMT subordinate revenue and refunding revenue bonds, 2025 Series B, serials 2026-2045, terms 2050, 2055; and $169.495 million of governmental purpose/Non-AMT subordinate refunding revenue bonds, 2025 Series C, serials 2026-2045. Barclays.

The Public Finance Authority is ready to cost Wednesday on behalf of the Salina Economic Development Authority, Oklahoma, $1.168 billion of non-rated American Tire Works Project revenue bonds, Series 2025A, term 2056. HilltopSecurities.

The Latest York City Municipal Water Finance Authority (Aa1/AA+/AA+/) is ready to cost Tuesday $603.715 million of water and sewer system second general resolution revenue refunding bonds, Fiscal 2025 Series CC, serials 2027-2032, 2037-2039, 2046. Raymond James.

The Board of Regents of the Texas A&M University System (Aaa/AAA/AAA/) is ready to cost Wednesday $372.15 million of Everlasting University Fund refunding bonds, Series 2025A. J.P. Morgan.

The Peralta Community College District, California, (/AA-/AA-/) is ready to cost Tuesday $361.785 million of GOs, consisting of $118.84 million of tax-exempt Series C-1 bonds, serials 2025-2026, 2043-2045, terms 2050, 2054; $211.785 million of tax-exempt refunding bonds, serials 2025-2039; and $31.16 million of tax-exempt Series C-2 bonds, serial 2025. Siebert Williams Shank.

The Missouri Housing Development Commission (/AA+//) is ready to cost Wednesday $250 million of non-AMT First Place Homeownership Loan Program single-family mortgage revenue bonds, 2025 Series C (Non-AMT), serials 2026-2037, terms 2040, 2045, 2050, 2055, 2056. Stifel.

The Texas Water Development Board (/AAA/AAA/) is ready to cost Tuesday $181.535 million of State Revolving Funds revenue bonds, Latest Series 2025, serials 2026-2046. Raymond James.

Louisiana (Aa3/AA//) is ready to cost Tuesday $150 million of gasoline and fuels tax second lien revenue refunding bonds, 2025 Series A. Wells Fargo.

The Colorado Health Facilities Authority (//A-/) is ready to cost Tuesday $148.62 million of Covenant Living Communities and Services revenue bonds, Series 2025A. Ziegler.

Kansas City, Missouri, (Aa2/AA+//) is ready to cost Thursday $144.315 million of water revenue bonds, Series 2025A. Morgan Stanley.

The Durango School District 9-R, Colorado, (Aa2///) is ready to cost Wednesday $130 million of Colorado State Intercept Program-insured GOs, serials 2025-2049. RBC Capital Markets.

The Jefferson Public Constructing Authority (Aa1/AA+//) is ready to cost Wednesday $106.39 million of School District of the City of Jefferson Project revenue bonds, serials 2036-2055. Raymond James.

Competitive
California is ready to sell $212.565 million of non-AMT veterans general obligation bonds in two series: $62.565 million of Series CW bonds at 11:30 a.m. Tuesday and $150 million of Series CX bonds at 11:30 a.m. Tuesday.

Metro, Oregon, is ready to sell $200 million of GOs at noon Tuesday.

The Dorchester County School District No. 2, South Carolina, is ready to sell $200 million of South Carolina School District Credit Enhancement Program GOs, Series 2025A, at 11 a.m. Tuesday.

Oklahoma City, Oklahoma, is ready to sell $160 million of GOs at 9:30 a.m. Tuesday.

The Davis School District Board of Education, Utah, is ready to sell $100 million of Utah School District Bond Guaranty Program GOs at 11:30 a.m. Thursday.