Municipal prices rose 1/4 point yesterday as market players moved briskly through supply that had been pushing prices lower over the last two weeks.
Prices had sagged under the weight of yearend supply last week, but The Bond Buyer's 30-day visible supply fell to $1.4 billion yesterday, down from levels that averaged $5 billion for several weeks.
Investors scoured the primary and secondary sectors boosting follow-through business on new deals, and tax-exempt traders reported a constructive atmosphere and a firm tone going into the close.
As a result, The Bond Buyer's 20-bond index fell nine basis points on the week, to 6.7%, the 11-bond index also fell nine basis points, to 6.58%, while the 40-bond index fell four basis points, to 6.84%. Cash infusions from funds sent the one-year note index to an all-time low. The index fell 26 basis points on the week, to 3.92%.
Economic data were mostly ignored yesterday, but inflation fears abated when the producer price index for finished goods edged up 0.2% in November, following a 0.7% increase in October.
In secondary trading, bid-wanted wires were light, and traders reported moderate activity with various blocks of bonds changing hands or leaving the Street.
In the debt futures market, the March contract settled up 14/32, to 94.29. The March MOB spread was calculated at negative 194.
Meanwhile, Standard & Poor's The Blue List of dealer inventory fell $115 million to $1.6 billion.
In secondary dollar bond trading, Denver Airport 7 3/4s of 2021 were quoted up nearly one point at 96 1/2-97 1/2 to yield 7.97%. Standard & Poor's said its BBB-minus rating on the credit was placed on CreditWatch with positive implications following the recent announcement that the city has reached an agreement with United Airlines.
In other dollar bond trading, New Jersey Turnpike 6 1/2s of 2016 were quoted at 98 5/8-3/4 to yield 6.60%, and Hawaii Airport AMT 6.90s of 2012 were quoted at 98 7/8-99 1/8 to yield 7%. Pennsylvania Turnpike 6 1/2s of 2013 were quoted at 98 1/8-1/4 to yield 6.65%, Port Authority of New York and New Jersey 6 1/2s of 2026 were quoted at 96-1/4 to yield 6.78%, and a New York State Environmental Facilities Corp. AMT 6 7/8s of 2010 were quoted at 99 3/4-par to yield 6.87%.
In the short-term note sector, yields were five basis points lower on average. In late secondary trading, Los Angeles Trans were quoted at 3.55% bid, 3.50% offered, while Texas Trans were quoted at 3.50% bid, 3.45% offered. California Rans were quoted at 3.55% bid, 3.50% offered, New York City Rans were quoted at 5.10% bid, 5% offered, and New York State Trans were quoted at 4.85% bid, 4.75% offered.
In light new-issue action, J.P. Morgan Securities won $60 million New Jersey Wastewater Treatment Trust revenue bonds with a true interest cost of 6.26%.
The offering included serials priced to yield from 4.25% in 1993 to 6.55% in 2011.
The bonds are rated double-A by Moody's and Standard & Poor's.
PaineWebber Inc. priced $40 million Bexar County, Tex., Health Facilities Development Corp. hospital revenue bonds for St. Luke's Lutheran Hospital project.
The offering included serial bonds priced at par to yield from 5.50% in 1992 to 7.30% in 2000. Term bonds in 2018 were priced to yield 7.967% and 7.90% in 2021.
The offering is rated Baa1 by Moody's and BBB by Standard & Poor's.