BlackRock Municipal II (BLE) Drops 0.31% Amid Policy Shifts

BlackRock Municipal II (BLE) experienced a decline of 0.31%, marking its seventh consecutive day of losses, with a cumulative drop of 3.11% over the past week. The share price fell to its lowest level since April 2025 today, with an intraday decline of 0.62%.

The strategy of buying BLE shares after they reached a recent low and selling after holding for one week resulted in a -9.48% return over the past five years. The benchmark return was 58.96%, indicating a significant underperformance of the strategy. The Sharpe ratio was -0.38, and the maximum drawdown was 0.00%, suggesting that the strategy had a negative risk-adjusted return and no capital was lost during the backtest period.

BlackRock recently announced updated distribution pay dates for its municipal closed-end funds on July 8, 2025. These updates can significantly influence investor sentiment and affect stock prices, as they are closely tied to expected returns and cash flow. Investors often react to changes in distribution schedules, which can lead to fluctuations in the stock price as they reassess the fund's attractiveness and potential income.

Additionally, the impact of anti-ESG policies on municipal borrowing costs, particularly in the state of Oklahoma, has indirectly affected BLE stock prices. These policies, which aim to reduce the influence of environmental, social, and governance (ESG) factors in investment decisions, can lead to increased borrowing costs for municipalities. This, in turn, can affect the performance of municipal bonds held by BlackRock funds, thereby influencing the fund's valuation and stock price. As municipalities face higher borrowing costs, the yield on their bonds may decrease, making them less attractive to investors and potentially lowering the fund's overall performance.