Barclays, JPMorgan say Munis worst week in 2024 – time to buy – BNN Bloomberg

(Bloomberg) — A selloff in the municipal market this week has opened up a buying opportunity, according to Wall Street strategists.

Muni returns surged earlier this week after a selloff in U.S. Treasuries as signs of a strong economy led investors to lower interest rate expectations. Muni bonds rose on Thursday.

But as of Friday morning, the benchmark 10-year note yield was still 26 basis points higher than earlier this week. Muni bonds are poised for their worst week of the year, according to Bloomberg Indices.

“Like last October, and obviously driven by election year dynamics, we believe investors will be able to find value at current adjusted market levels this week and next week, especially given strong market technical readings in November and into the new year JPMorgan Chase & Co. said in a statement. strategists led by Peter DeGroot wrote in a Friday note.

The largest muni exchange-traded fund, the iShares National Muni Bond ETF, took in $362 million on Thursday, according to data compiled by Bloomberg. Money flowing into ETFs helped support Thursday’s gains, JPMorgan strategists said.

And Barclays Plc strategist Mykhailo Fuchs said he expects Munis to perform well at the end of 2024.

“While there is no sense that the sell-off is over and we would like to see some stabilization first, we tend to slowly start to sink our feet in,” he wrote on Friday.