- The $3.9 trillion U.S. municipal bond market is on track to finish 2020 with returns of about 5.2%, marking the seventh straight year of gains and showcasing the rebound from a record selloff in March as fears about the pandemic’s fiscal fallout rattled investors.
- Initial jobless claims fell to 787,000 last week, from a revised 806,000 the prior week. That was better than the 835,000 consensuses. Bloomberg Economics said the figure might rise over the coming weeks. Continuing claims eased to 5.2 million from a revised 5.3 million, also better than expected.
- A measure of home prices in 20 U.S. cities rose in October by the most since 2014 as ultra-low mortgage rates and increased buyer appetite for more space depleted housing inventory. The S&P CoreLogic Case-Shiller index of property values climbed 7.95% from the same month the previous year; data released Tuesday showed. The median forecast in a Bloomberg survey of economists called for a 6.95%-year-over-year advance. Home prices rose 1.6% from the previous month, more than projected and the most since April 2013.
- The prospects for boosting stimulus payments for most Americans to $2,000 are fading fast in the Republican-controlled U.S. Senate even with GOP leaders under pressure from President Donald Trump and congressional Democrats. The partisan clash over the payments also is entangling another piece of year-end business in the Senate -- a vote to override Trump's veto of a crucial $740.5 billion defense policy bill. Senator Bernie Sanders is attempting to delay the defense legislation unless Senate Majority Leader Mitch McConnell relents and allows a vote on a standalone bill on the bigger stimulus checks. On Tuesday, McConnell blocked Democratic leader Chuck Schumer's attempt to set up a vote on a House-passed bill that would increase the payments to $2,000 from the $600 -- the amount in the pandemic relief measure Trump signed into law on Sunday. As the chances for quick action on bigger stimulus checks faded, U.S. stocks pulled back from record highs, with the S&P 500 Index falling 0.2%.
- A New Hampshire Retirement Community will default on $73M muni bonds: a continuing care retirement community in Keene, NH, will not make an interest payment on about $73 million municipal bonds due January 1, according to a securities filing.
- Redemptions should continue to be heavy in 2021, and I also expect to see Mutual funds on the MUNI side continue to take in cash from investors as we move through the first half of 2021. If we do have defaults (more than average) in the high-yield sector, as mentioned above, this could spook investors in all asset classes, which could cause net redemptions; we will have to watch this closely.
605-B Park Grove
Katy, TX 77450
(866) 664-4040 (toll-free)
(281) 398-8600 (direct)
(281) 398-8607 fax
This report has no regard to the specific investment objectives, financial situation, or needs of any particular recipient. This report is based on information obtained from sources believed to be reliable, but no independent verification has been made, nor is its accuracy or completeness guaranteed. This report is published solely for informational purposes and is not construed as a solicitation or an offer to buy or sell securities or related financial instruments. Opinions expressed herein are subject to change without notice and the division, group, subsidiary, or affiliate of MACC., which is under no obligation to update or keep the information current. The securities described herein may not be eligible for sale in all jurisdictions or to specific categories of investors. MACC accepts no liability for any loss or damage of any kind arising out of the use of this report. Please contact your tax advisor regarding the suitability of tax-exempt investments in your portfolio. Income from municipals may be subject to state and local taxes as well as the Alternative Minimum Tax. Corporate and Municipal securities are subject to gains/losses based on the level of interest rates, market conditions, and credit quality of the issuer. As with any security, there is an inherent market risk possibility as to principal if the security is not held to maturity. The non-rated (NR) bonds should be considered for investment by knowledgeable and sophisticated investors. Additional information will be made available upon request.
Securities are offered through Mid Atlantic Capital Corporation (MACC), a registered Broker-Dealer, Member FINRA/SIPC.
The DRL Group. is not a registered entity or a subsidiary or control affiliate of MACC.
Bonds are subject to market and interest rate risk if sold prior to maturity. Prices and availability may change at any time without notice. Insured bonds are subject to the claims-paying ability of the insurance company.
Reminder: Email sent through the Internet is not secure. Do not use email to send us confidential information such as credit card numbers, change of address, PIN numbers, passwords, or other important information. Do not email orders to buy or sell securities, transfer funds, or send time-sensitive instructions. We will not accept such orders or instructions. This email is not an official trade confirmation for transactions executed for your account. Your email message is not private in that it is subject to review by the firm, its officers, agents, and employees. Unless expressly stated in this email, nothing in this message should be construed as a digital or electronic signature.