MacKay Municipal Managers’ Post

Check out this podcast from MacKay Muni Managers for an update on the #municipalbond market!

Join Alex McLaughlin, CFA as he offers his thoughts on the volatility we’re seeing in the muni market, an update on issuance and an update on fundamentals. Listen here: https://bit.ly/47w3Jv6 #Muni360

Birch Creek Weekly Commentary: 3/1/24: Muni Market Caution Persists The muni market remained cautious amid rich valuations and looming supply/demand challenges, with interest primarily in SMA maturities and bonds offering higher yields. After appearing to show some cracks, dealers managed to pare down competitive new issue balances as treasury yields fell. Despite the late-week treasury rally, muni investors are awaiting further compelling valuations to reignite excitement. If you find this interesting and want to receive our commentaries sent directly to your inbox so you don't miss out on any content, please sign up at link below: https://lnkd.in/eZp7RAeJ #municipalbonds  #municipal #municipalbond #highyield #commentary #marketvolatility #highyieldbonds #investmentinsights #MuniBonds

Birch Creek Weekly Commentary: 3/15/24: Resilient Muni Market Amidst Treasury Volatility The muni market remained resilient despite Treasury volatility, with yields rising modestly across most tenors. Bid lists surged throughout the week but accounts were focused on new issues. As valuations worsened, investors sought additional spread in the primary market, leading to strong demand for new issues, including in longer maturity bonds. In the high yield market, cash inflows persisted, prompting interest in unique issuers. While benchmark names saw some weakening, primary deals were met with heavy oversubscriptions, indicating continued investor appetite for specific opportunities. The HY new issue pipeline is increasing, which should offer welcome relief to funds, although speculative deals may still face caution. If you find this interesting and want to receive our commentaries sent directly to your inbox so you don't miss out on any content, please sign up at link below: https://lnkd.in/eZp7RAeJ #municipalbonds  #municipal #municipalbond #highyield #commentary #marketvolatility #highyieldbonds #investmentinsights #MuniBonds

The muni market remained cautious amid rich valuations and looming supply/demand challenges, with interest primarily in SMA maturities and bonds offering higher yields. After appearing to show some cracks, dealers managed to pare down competitive new issue balances as treasury yields fell. Despite the late-week treasury rally, muni investors are awaiting further compelling valuations to reignite excitement.

The muni market supply/demand equation favors investors. Outsized muni bond reinvestment income is projected to be approximately $100 billion through the summer. Learn more in our weekly commentary. #weeklyinsights

The muni market remained relatively stable despite the rise in Treasury yields, with the AAA MMD curve seeing minimal changes throughout the week. Investors appeared eager to invest cash at higher absolute yields, particularly considering the upcoming seasonally strong period from May to September. Primary deals, like Harvard University's, saw modest subscriptions with some concessions, indicating continued investor interest. In the HY space, bonds showed resilience, outperforming both higher grades and treasuries as major deals remained scarce. However, increased distress in sectors like senior living and hospitals has led to some selling of distressed credits, suggesting a potential growing opportunity set in the future.

The steadiness of the muni market despite the swings in USTs shows both a trepidation on investor commitment at these levels and the underlying strength of the credit quality of the asset class that can't justify tethering itself to USTs.

Birch Creek Weekly Commentary: 4/12/24: Muni Market Resilience In Face of Rising Rates The muni market remained relatively stable despite the rise in Treasury yields, with the AAA MMD curve seeing minimal changes throughout the week. Investors appeared eager to invest cash at higher absolute yields, particularly considering the upcoming seasonally strong period from May to September. Primary deals, like Harvard University's, saw modest subscriptions with some concessions, indicating continued investor interest. In the HY space, bonds showed resilience, outperforming both higher grades and treasuries as major deals remained scarce. However, increased distress in sectors like senior living and hospitals has led to some selling of distressed credits, suggesting a potential growing opportunity set in the future. If you find this interesting and want to receive our commentaries sent directly to your inbox so you don't miss out on any content, please sign up at link below: https://lnkd.in/eZp7RAeJ #municipalbonds #municipal #municipalbond #highyield #commentary #marketvolatility #highyieldbonds #investmentinsights #MuniBonds

Birch Creek Weekly Commentary: 6/14/24: Falling Yields And Light Primary Lead To Further Muni Gains The muni market experienced a more subdued tone this week despite the favorable inflation data and rate cut speculation affecting treasuries. The AAA benchmark curve underperformed but still saw yields fall by 10-13bps. HY muni investors continued to see tighter spreads amid low supply and strong cash inflows, highlighted by the oversubscription of a major BBB- rated bond deal. Additionally, a court ruling reversed previous findings in the PREPA bankruptcy case, significantly improving bondholder positions. If you find this interesting and want to receive our commentaries sent directly to your inbox so you don't miss out on any content, please sign up at link below: https://lnkd.in/eZp7RAeJ #municipalbonds #municipal #municipalbond #highyield #commentary #marketvolatility #highyieldbonds #investmentinsights #MuniBonds