U.S. muni bond sales expected to rise to $10.24 bln next week
NEW YORK, Aug 9 (Reuters) - U.S. municipal bond sales next week are expected to rise to nearly $10.24 billion from a revised $7.16 billion this week, according to Thomson Reuters estimates on Friday. If all the deals price next week, this will mark the second-largest calendar so far this year, since the week ended April 12, when sales totaled over $11 billion, according to Ipreo. Rising yields in the secondary market, especially in longer-dated maturities, cast a chill in the primary market this week, with the South Carolina Public Service Authority cutting its planned bond sale by 25 percent to $1.34 billion. The California Infrastructure and Economic Development Bank also has postponed indefinitely a $195.8 million refunding revenue issue for the California Independent System Operator Corporation Project. On Thursday Michigan's Saginaw County become the third local issuer in the state to postpone a bond sale amid investors' concerns over Detroit's bankruptcy filing. Pushing the size of the municipal bond primary market calendar higher next week will be California's negotiated sale of $5.5 billion of revenue anticipation notes. The sale, nearly half the amount California borrowed last year and below January's estimates, will have a one-day retail order period on Wednesday, with institutional pricing on Thursday through lead manager JP Morgan. In 2012, California sold RANS for $10 billion and in 2011 for $5.4 billion. Ahead of the sale the notes were rated MIG1 by Moody's Investors Service, SP-1 plus by Standard & Poor's Ratings Services and F1 by Fitch Ratings. Altogether, negotiated sales next week are expected to total $9.48 billion versus a revised $4.36 billion this week. The largest long-term deal on the negotiated calendar is Connecticut's $500 million tax-exempt and taxable two-part bond issue pricing on Wednesday. The deal consists of $165 million of tax-exempt general obligation Securities Industry and Financial Markets Association bonds with serial maturities from 2014 through 2023, and $235 million of tax-exempt GO bonds with serial maturities from 2014 through 2033, according to the preliminary official statement. These bonds will be sold through lead manager M.R. Beal & Co. Another $100 million of taxable GOs in the Connecticut deal with serial maturities from 2014 through 2023 will be priced via lead manager Loop Capital Markets. The bonds are rated Aa3 by Moody's and AA by Fitch. Both rating agencies have assigned the bonds a stable outlook. Competitive deals are expected to total only $757.89 million in 78 sales, falling significantly from $2.8 billion in 106 issues in the week ended Aug. 9. On Wednesday, Sachem Central School District at Holbrook, New York will sell $74 million of tax anticipation notes. On Thursday, New Jersey's Burlington County will sell $40.2 million of GO bonds, the largest long-term deal on the competitive calendar next week.
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