CREDIT MARKETS

Treasuries:
Treasury 30 year bonds rose for the first time in four days after the Federal Reserve included the longest maturity U.S. debt among the securities scheduled to be repurchased to keep consumer borrowing costs low. The central bank will begin buying Treasuries tomorrow, starting with notes due firm February 2016 to February 2019. The Treasury sold $40 billion of two year notes today. It will sell $34 billion of five year debt tomorrow and $24 billion of seven year securities on March 26. Demand for the two year Treasury securities was stronger than at the last auction, judging by the bid/cover ratios. Indirect bidders bought 53.1 percent of the amount sold, compared with 28.1 percent in the prior auction. Also on Tuesday, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Timothy Geithner pressed Congress to give them new powers to close down non-bank financial firms in an orderly fashion. Economic news for tomorrow will focus on durable goods and new home sales.

Municipals:
California completed a $4 billion bond sale a day sooner than planned, as orders from individual investors accounted for at least 80 percent of the largest U.S. tax-exempt offering since 2007. Additionally, the deal was upsize by $2.5 billion to satisfy institutional demand. California, whose credit ratings were cut to the lowest among U.S. states this year partly because of a record budget impasse, attracted buyers with yields about 0.2 percentage point higher than similar securities in the secondary market, traders said. “You can’t find many places that have more negative stigma to it, and yet it’s being well received,” Preliminary California yields ranged from 3.25 percent on notes due in 2013 to 6 percent on bonds set to mature in 2036. Top-rated general obligation bonds due in 10 years held at a 3.48 percent yield today. Other issuers in the market were Northwestern Memorial Hospital in Illinois, New York’s Environmental Facilities Corp., the Metropolitan Washington Airports Authority and the Maricopa County Community College District in Arizona. The read on the MMD was as follows: in the short end the yields were higher by 1-2 bpts and on the long end yields were higher by 0-2 bpts.

Commentary/New Issues

Corporate:
$2.75 BLN, Verizon Comunications, A3/A, 2 part $1.75 BLN, 6.35%, 4/1/19, +387.5bp; $1.0 BLN, 7.35%, 4/1/39, +387.5bp
$500 MM, Staples, 7.75%, 4/1/11, Baa2/BBB, +683.4bp
$250 MM, Emory University, 5.625%, 9/1/19, Aa2/AA, 300bp

ABS:
(priced) $284 MM, Jackson Square CLO, ABS

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets.