Municipal bond yields could come under pressure in the near term if the steady cash flows into open end mutual funds slows, or if the pace of new issue supply picks up, said Robert Amodeo, head of municipal bonds at Wester Asset Management. But don't bet on it. 'We are not expecting those events to surface during the near future,' said Amodeo, adding that on a relative basis, he sees muni valuations fully valued at the short end of the curve with better values available in the intermediate and longer intermediate maturity range. Year to date supply, at the end of May, is roughly $157 billion, which is down about eight percent versus the same period during 2015. Meanwhile, muni open end mutual funds posted very strong inflows so far this year. Year to date, the Barclays Municipal Index reported returns of 3.7 percent for the market. In Amodeo's view, the troubles of municipal debt issuers in the headlines like Puerto Rico and Chicago are not new information and mostly priced into the respective securities.
More from Video
How quickly do we find support, is what we'll want to know now, as the correction is occurring while economic optimism builds.
Despite the president's promise of no stimulus until after Nov. 3, there are no signs yet that this is the sort of correlated selling that leads to a deep correction.
Salesforce, Amgen and Honeywell will give a lift to the DJIA going forward.
CAG has hung onto the bulk of its recent gains, and could rise to the $50 area, according to the charts and indicators.