After last week's worrisome close, markets were understandably shaky this week, as investors prepared for 2014's Q1 earnings season. Markets were able to rebound during the beginning of the week, after the release of the Fed minutes reassured investors that the Federal Reserve plans to remain accommodative. Thursday, however, saw all major indexes close lower, with the Nasdaq shedding 3%, while the S&P 500 posted its largest loss since early February. Friday morning saw markets fall even further, after JPMorgan Chase reported lackluster Q1 earnings while Wells Fargo beat profit estimates due to a series of one-time gains. Initial Jobless Claims came in below expectations this week at 300,000, compared to the analyst views of 320,000. The BLS released March's Producer Price Index on Friday morning, with the PPI coming in at 0.5% compared to expectations of 0.1%. In the bond markets, 10-Year Treasury yields were down slightly to 2.65 on Thursday, after starting the week at 2.71. Below, we look at all of Moody's municipal bond upgrades and downgrades from the past week.

Upgrades

• California Housing Finance Agency's Residential Mortgage Revenue Bonds, 2009 Series A-5: Moody's upgraded this agency's revenue bonds to A2 from A3. The upgrade is based on the significant improvement in the performance of single family mortgage loans securing bond repayment, demonstrating a rate and level of improvement that has exceeded expectations when the rating was assigned. It further reflects solid financial performance demonstrated in the program's first full fiscal year, and cash flow projections demonstrating ability to repay debt under stress scenarios.
• Dallas Center-Grimes Community School District, IA: Moody's upgraded this school district to Aa2 from Aa3/POS. The upgrade to Aa2 is primarily based on the district's moderately-sized tax base within the Des Moines(Aa1/rating under review for possible downgrade) metropolitan area, solid financial position characterized by a trend of operating surpluses, positive enrollment trends, manageable debt position, and moderate exposure to underfunded pension liabilities.
• Southland Independent School District 500, MN: Moody's upgraded this school district to A1 from A2. The upgrade to A1 from A2 reflects the district's currently strong financial position with healthy reserve levels that are expected to decline, but still remain satisfactory. The rating also incorporates the moderately sized rural tax base with limited new growth expected and a very modest debt burden.
• City of Spokane Valley, WA: Moody's upgraded this city to Aa3 from A1. The upgrade and Aa3 rating reflects the city's low debt burden, sizeable tax base which is expected to expand into the medium-term, and healthy financial performance, which is maintained through strong management practices.
• Montgomery County Water Control and Improvement District 1, TX: Moody's upgraded this district to A3 from Baa1. The upgrade to A3 reflects a healthy financial position. The rating also reflects a small but growing tax base as well as elevated debt burdens.
• Village of Farmingdale, NY: Moody's upgraded this village to Aa3 from A1. The Aa3 rating reflects the village's strong financial position, modestly-sized tax base with above average income indices, average debt position and below average pension liability.
• Summit County School District Re-1, CO: Moody's upgraded this school district to Aa1 from Aa2. The rating upgrade is primarily based on the district's strong financial performance supported by strong reserve levels, sizable tax base and somewhat affluent population in a major ski resort area, and a favorable debt profile.
• New York City Municipal Water Finance Authority, NY: Moody's upgraded to VMIG 1 from VMIG 2 the short-term rating for this authority's $100 million Water and Sewer System Revenue Bonds Adjustable Rate Fiscal 2001 Series F-1. The short-term VMIG 1 rating reflects the credit quality of the Bank, as provider of the SBPA, and our assessment of the likelihood of termination of the SBPA without a mandatory tender. Events that would cause the liquidity facility to terminate without a mandatory purchase of the Bonds are directly related to the credit quality of the Authority.

Downgrades

• Appleton, WI: Moody's downgraded this city to Aa1 from Aaa. The Aa1 rating reflects the city's strong financial profile with healthy reserves, modest debt and pension burden, and strong management team. The rating also incorporates the city's sizeable tax base that serves as an economic center in Outagamie County (Aaa) with an average resident income profile and relatively low property wealth.
• Channahon Fire Protection District, IL: Moody's downgraded this district to A1 from Aa2. The A1 rating reflects the district's modestly sized and declining tax base located in suburban Will County(GO rated Aa1); limited operating reserves balanced by a healthy reserve position in the Capital Projects Fund; and a manageable debt profile with no unfunded pension liabilities.
• City of Cudahy, WI: Moody's downgraded this city to A2 from A1. The A2 rating reflects the utility's small, concentrated but stable customer base; narrow cash position that is expected to remain at current levels; and historically healthy debt service coverage ratios. The rating also incorporates the essential nature of the services provided; above average legal protections; and a low debt ratio with limited future borrowing plans.
• Caldwell County, KY: Moody's downgraded this county to A3 from A1. The A3 rating reflects the county's modest, rural tax base, below average socio-economic profile, declining fund balance, and ongoing operational pressure from county jail operations. The rating also incorporates the county's favorable debt burden with no immediate plans to issue debt.
• City of Milwaukee, WI: Moody's downgraded this city's general obligation bonds to Aa3 from Aa2. The Aa3 rating on Milwaukee's GO debt reflects the city's weakened socio economic indices, elevated unemployment rate and trend of tax base declines; additionally, it reflects the interest rate risks and refinancing risks associated with certain of the city's debt instruments. The city's use of these debt structures is expected to increase.
• Montague Area Public School District, MI: Moody's downgraded this school district to Baa1 from A2. The downgrade is based on the district's deteriorating financial trends which have resulted in an extremely narrow General Fund balance and overall liquidity position. Also incorporated is the district's stable enrollment trend which is projected to continue; its modest and depreciating tax base; below average socioeconomic profile; above average debt profile with below average principal amortization; and Michigan's (GO rated Aa2/positive) weak institutional framework for school districts that provides for very limited revenue raising flexibility.
• City of Marion, OH: Moody's downgraded this city to Baa1 from A3. The downgrade to Baa1 reflects the city's strained finances and weak socioeconomic profile. The rating also reflects the city's above average debt burden, declining tax base, enterprise risk relating to its Landfill and Aquatics Center, and long term risks posed by exposure to underfund cost-sharing pension plans.
• Bedford County, PA: Moody's downgraded this county to Baa1 from A3. The downgrade to Baa1 reflects the county's negative financial position that has continued to deteriorate since fiscal 2007 as the county utilized reserves to offset operating shortfalls. The rating also reflects a moderately sized tax base with below-average wealth levels and above-average debt burden.
• Huber Heights City School District, OH: Moody's downgraded this school district to A1 from Aa3. The downgrade to A1 reflects the district's history of operating deficits resulting in significantly narrowed fund balance and cash reserves. Management anticipates an operating surplus in fiscal 2014, but reserves are not expected be restored to prior levels within the near to medium term.