The markets started the week on a sour note, but by Thursday were starting to show signs that the sell-off may not be as bad as some had feared. Apple (AAPL) was one of the big losers this week, even though it surpassed analysts' earnings estimates. The company's stock was down 9% on the week by midday on Friday, as investors were not pleased with the company's iPhone sales. The Fed announced on Wednesday that it would still be pulling back on its monthly bond purchases, which did not bode well for emerging markets, and was also felt in the U.S.

On the macro front, investors got some positive news, as the U.S. Q4 GDP showed growth of 3.2%, which was in line with analysts' expectations. As well, January's consumer confidence index came in at 80.7, higher than the expected 78. On the negative side of macro news, initial jobless claims came in higher than the expected 330K at 348k. The 10-Year Treasury yield for the week started at 2.78 before dipping to 2.69 on Wednesday, following the Fed announcement, and then bouncing back to 2.72 by Thursday's close. Below, we look at all of Moody's municipal bond upgrades and downgrades from the past week.

Upgrades

• North Providence, RI: Moody's upgraded this town to A3. The upgrade to A3 reflects the town's improving financial position characterized by four consecutive years of surplus operations through fiscal 2013 and a recently reduced local pension liability due to windfall revenues received from a federal Google settlement. The rating also incorporates the town's relatively stable, moderately-sized tax base with average wealth and a manageable debt burden.
• Palos Verdes Library District, CA: Moody's upgraded this district to Aa1 from Aa2. The upgrade to Aa1 reflects the district's large, stable, and affluent tax base encompassing the Palos Verdes peninsula, a primarily residential community on the California coast about 25 miles south of downtown City of Los Angeles (GO rated Aa2, stable outlook). This strong economy supports the district's property tax-dominated finances, which are characterized by an available fund balance that has remained above 60% of revenues for five straight years.
• The Woodlands Township, TX: Moody's upgraded this township to A1 from A2. The upgrade to A1 reflects the positive revenue growth providing solid debt service coverage and an affluent, growing base while incorporating taxpayer concentration and adequate legal provisions.
• Upper Trinity Regional Water District, TX: Moody's upgraded this water district to Baa1 from Baa3. The upgrade to Baa1 and new rating assignment reflect improved credit quality of the pool participants, a fast growing service area, the system's stable financial position, and active management of the district. The rating incorporates structural elements of the enhanced pool financing, including participant step-up provisions and a cash-funded debt service reserve fund. The rating was determined using the "Weighted-Average Probability of Default Approach" outlined in the Public Sector Pool Financings methodology, given the collective pools' strong structural elements.
• Clark County, NV: Moody's upgraded this county's Airport System Subordinate Lien Revenue Bonds to Aa1 from Aa2. Moody's has determined the joint probability of default between each Bank and the Enterprise is low and therefore results in long-term JDA ratings of Aa1 for each Series of Bonds.
• Cedar Park Water and Sewer Enterprise, TX: Moody's upgraded this enterprise to Aa2 from Aa3. The upgrade to Aa2 reflects the solid debt service coverage, healthy reserves, and low debt ratio. The rating also incorporates the moderate size of the system which has sufficient capacity, irregular rate increases, and weak legal provisions.

Downgrades

• St. Charles Parish Hospital Service District #1, LA: Moody's downgraded this service district to Ba1 from A2. The downgrade to Ba1 reflects the district's consistently strained financial operations, a very narrow cash position and a highly leveraged debt position due to frequent borrowing and the extension of maturities. The rating also takes into account the district's sizeable and growing tax base which is heavily concentrated in the oil and gas industry, and an average socio-economic profile.
• Grundy County School District 54, IL: Moody's downgraded this school district to A3 from A2. The A3 rating reflects the district's declining operating reserves and limited financial flexibility with continued use of annual working cash borrowing to support operations. Also incorporated in the A3 rating is the district's declining tax base valuations; ongoing litigation with one of the district's largest tax payers; and elevated direct debt profile with below-average principal amortization.
• City of Williston Sales Tax Revenue Bonds, ND: Moody's has downgraded this city's Sales Tax Revenue Bonds of 2009 to Baa2 from A3. The Baa2 rating reflects the City of Williston's weakened credit quality and recent declines in maximum annual debt service coverage resulting from additional leveraging of sales tax revenues. The rating also incorporates the significantly improving sales tax collections, adequate debt service coverage, a growing tax base with economic concentration in the oil industry, annual risk of non-appropriation and satisfactory legal protections. Moody's also downgraded the city's GO bonds to Baa2 from A3.
• Williston Water Enterprise, ND: Moody's downgraded the city of Williston's water revenue bonds to A3 from A1. The downgrade to A3 reflects significant operating pressures which are driving declines in financial flexibility and reserves. Fiscal 2012 and preliminary fiscal 2013 data indicate a widening gap between operating revenues and expenses, with a negative unrestricted cash balance in fiscal 2013. The rating also incorporates the system's large capital needs, recently improved debt service coverage, a weak track record of implementing rate increases, growing service area, manageable debt levels, and satisfactory legal protections.
• Williston Sewer Enterprise, ND: Moody's downgraded the city of Williston's sewer revenue bonds to Baa1 from A3. The Baa1 rating reflects declined credit quality of the system, major infrastructure needs, and non-compliance with the Clean Water Act for six out of the last twelve quarters. The rating also incorporates a growing customer base and low debt ratio, improved debt service coverage, a weak track record of implementing rate increases, and satisfactory legal protections.
• Brea-Olinda Unified School District, CA: Moody's downgraded this school district to Aa3 from Aa2. The rating downgrade primarily reflects the district's lower than average liquidity and reserve balance for its current rating level. Despite credit strengths like the district's median family income wealth levels and strong $7.2 billion tax base, the district has experienced five years of operational imbalance.
• Oregon Local Governments: Moody's downgraded this group's Limited Tax Pension Obligations, Series 2002 A&B bonds to A3 from Aa3. The downgrade to A3 primarily reflects the deteriorated credit quality for some of the underlying pool participants. The rating also incorporates the overall sound structure of this unenhanced pool. Moody's has evaluated this unenhanced pool using the "Weak Link Plus" rating approach outlined in the methodology, which places a greater emphasis on the probability of default by the weakest participant in the pool.
• Oregon Local Government: Moody's also downgraded this group's Limited Tax Pension Obligations, Series 2005 bonds to A from Aa3. The downgrade to A1 primarily reflects the deteriorated credit quality for some of the underlying pool participants. The rating also incorporates the overall sound structure of this unenhanced pool.
• Fresno, CA: Moody's downgraded this city to Baa1 from A3. The rating downgrades primarily reflect the persistent weakness of the city's economy, which is further weakening the city's financial profile relative to most other, Moody's-rated California cities. Fresno's labor market is underperforming relative to the state and the nation.
• Clyde Park District, IL: Moody's downgraded this district to Baa2 from Baa1. The Baa2 rating reflects the district's declining tax base; weak socio-economic profile; limited revenue raising ability; narrow liquidity; and highly leveraged tax base, as reflected by an elevated overall debt burden. These challenges are balanced against a manageable level of rapidly retired direct debt and a low pension burden.
• Rapides Finance Authority, LA: Moody's downgraded this finance authority to A1 from Aa3 under review for downgrade. Based on the review of account statements, the financial position of the program has underperformed original cash flow projections. As a result, the bond program is more susceptible to potential insufficiencies in the event of administrative error. This rating downgrade to A1 reflects this risk.
• King County Housing Authority, WA: Moody's downgraded this housing authority to Baa3 from Baa2. The bonds are being downgraded as a result of a projected revenue shortfall on July 1, 2020 assuming a 0% reinvestment rate on fund balances.
• City of North Las Vegas, NV: Moody's downgraded this city to Ba3 from Ba1. The downgrade to Ba3 and negative outlook primarily reflect the city's substantial fiscal pressures over the near term. Importantly, on January 21, 2014 the District Court ruled to strike down the city's declarations of a state of emergency used to balance its budgets in FY2013 and FY2014.
• Frazer School District, PA: Moody's downgraded this school district's GO bonds to Baa1 from A3, and the district's bonds' enhanced rating to A2 from A1. The downgrade to Baa1 and negative outlook reflects material deterioration in reserves to levels no longer consistent with the 'A' rating level. Moody's believes that the district's ability to strengthen its financial position will continue to be challenged by its limited revenue raising ability and trend of increasing fixed costs. The Baa1 rating also incorporates the district's limited tax base, below average wealth levels, and high debt burden. The A1 enhanced rating is based upon the additional security for the district's general obligation bonds provided by the Commonwealth of Pennsylvania's Act 150 School District Intercept Program. The Act provides for undistributed state aid to be diverted to bond holders in the event of default. The negative outlook of the enhanced rating reflects the negative outlook assigned to Frazier School District's underlying rating.