Yields on The Bond Buyer's weekly municipal bond indexes barely moved this week, as investors, lacking any incentive to enter the market ahead of today's employment report, allowed prices to drift in a tight range.
The yield on the 20-bond index of general obligation bonds remained entrenched at 5.30% for the third consecutive week. The 11-bond GO index inched two basis points higher, to 5.21% from 5.19% last Thursday.
The 30-year revenue bond index slipped one basis point, to 5.52% from 5.53% last week.
The average yield to maturity of the 40 bonds used to calculate the daily Municipal Bond Index fell four basis points, to 5.43% from 5.47% from a week ago. All of the decline can be attributed to the twice-monthly revision in the index's list of bonds. The latest revision, on Sept. 30, reduced the 40 bonds' average coupon rate five basis points, to 5.36% from 5.41%.
The government market similarly meandered throughout the week, with the yield on the 30-year U.S. Treasury bond dipping two basis points, to 6.00% from 6.02% last Thursday.
"The only thing happening this week was a lot of wait-and-see on the employment numbers," a market watcher said. "It's been the only dominant factor of the market."
During the six-week rally that dominated the market from July 29 to Sept. 9, the 20-bond index dropped 41 basis points, to 5.24% from 5.65%.
But in the five weeks since then, the index has moved all of six basis points. The last time the index remained the same for three weeks in a row was Aug. 4 through Aug. 18, 1977, when it remained at 5.63%.
Mirroring the lethargy in municipal price movements, Standard & Poor's & Corp.'s The Blue List has been up one day and down the next. This measure of dealer inventory was down $110 million yesterday, to $1.89 billion from $2 billion Wednesday, and $320 million lower on the week, from $2.21 billion last Friday.
Issuers have shown equally little desire to rush issues into the market. The Bond Buyer's 30-day visible supply, after popping up to $7.24 billion on Tuesday - the highest level since $7.37 billion on Aug. 2 - tumbled to $5.39 billion yesterday.
Competitive issues have increased their share of the visible supply in recent months. They account for 43% of October's daily average supply, up from 39% in August and September and 30% for the January-July period.
The Bond Buyer's one-year note index rose two basis points in yield, to 2.76% from 2.74% a week ago.
