Municipal prices were narrowly mixed in light trading on Friday but activity was on hold ahead of this week's economic indicators and nearly $3 billion in new supply.
Prices stabilized at the end of last week, and yields were generally locked in a range as the market looks to this week's slate of economic news for new direction.
"It's impossible to deduce anything more from here," said a trader late Friday. "It seems like we've found a lower tier to work from, but we'll have to wait and see what those numbers do."
Tomorrow, the Commerce Department reports preliminary third-quarter gross national product. Wednesday, single-family home sales for September will be releases, accompanied by personal income and spending for September. Thursday, jobless claims for the week ending Oct. 19 are due out as well as factory orders for September.
But the most important data will be released Friday, when October unemployment figures are released. Leading economic indicators and construction spending will also be reported.
The markets are hoping for a Fed ease on the unemployment data as the economy appears to still be weak, but traders acknowledge that the jury is still out on the market's near term prospects.
"The market may tend to meander until Friday, and prices are likely to be buffeted by the cross-current of data," said William Sullivan, a money market economist for Dean Witter Reynolds, Inc. "The market has only been able to do better on data that reflect a weak economy and Friday's unemployment numbers are likely to show a decline. Without any significantly bullish data, the market is apt to drift lower."
Supply will also be a factor as underwriters continue to work off new balances from last week's deals, while the calendar continues to grow.
Looking ahead to supply, The Bond Buyer's 30-day visible supply rose $387 million Friday, to $3.02 billion, while Standard & Poor's Corp.'s The Blue List fell $4 million, to $1.38 billion on Friday.
Nearly $3 billion in securities are slated to hit the market this week.
The competitive sector features $441 million California general obligation bonds, $272 million Georgia general obligation bonds, and $193 million Nevada various limited tax full faith and credit bonds. Also expected are two issues from the East Bay Municipal Utility District totaling $180 million.
The negotiated sector features $120 million Harrisburg Authority, Pa., lease revenue bonds, to be priced by Commonwealth Securities and Investments, Inc.
New-issue action was typically light on Friday, but Goldman, Sachs & Co., senior manager for $300 million Massachusetts Water Resources Authority general revenue bonds, freed the issue from syndicate.
In late secondary trading, Massachusetts Water 6 1/2s of 2019 were quoted at 93 1/4-1/2 to yield 7.04%.
In follow-through business, Goldman Sachs, as senior manager for $158 million Missouri general obligation refunding bonds, reported an unsold balance of $43 million late in the session.
Goldman, senior manager for $120 million Maryland general obligation bonds, reported an unsold balance of $8 million.
Goldman, also senior manager for $100 million Los Angeles Department of Water and Power water works revenue bonds, reported an unsold balance of $12.5 million.
Lehman Brothers, senior manager for $124 million New Hampshire Housing Finance Authority single-family residential mortgage bonds, reported an unsold balance of $10 million.
Secondary trading was light on Friday, and activity ground to a halt by early afternoon.
In secondary dollar bond activity yesterday, North Carolina Eastern 6 1/2s of 2017 were quoted at 95 7/8-96 1/8 to yield 6.82% and Georgia MEAG 6.60s of 2018 were quoted at 98-1/4 to yield 6.74%. Denver Airport 7 3/4s, due 2021, were quoted at 93-7/8-94 to yield approximately 8.29%. New York City Water Authority 7s of 2015 were quoted at 98 5/8-7/8 to yield 7.09%, while Triborough Bridge and Tunnel Authority insured 6 5/8s were quoted at 98 1/2-7/8 to yield 6.71%.
Short-term note yields sank as much as 10 basis points on the day.
In late secondary trading, Los Angeles Trans were quoted at 4.30% bid, 4.20% offered. Texas Trans were quoted at 4.30% bid, 4.25% offered and Pennsylvania Tans were quoted at 4.46% bid, 4.33% offered. March New York State Trans were quoted at 5.12% bid, 5.10% offered.