Full text of H.16 Capital Market Developments : April 4, 1957

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

^
H.lU

.-

^

^NTE9 %
-'

A p r i l h, 1957

CAPITAL MARKET DEVELOPMENTS
The volume of l a r g e p u b l i c l y o f f e r e d s e c u r i t i e s was subs t a n t i a l l a s t - week, p a r t i c u l a r l y f o r corporate s e c u r i t i e s , but i s
expected t o be somewhat smaller t h i s week. During the week ending
March 29, corporations sold l a r g e i s s u e s t o t a l i n g $286 m i l l i o n ,
comprised of t h e $250 m i l l i o n AT&T debenture i s s u e and e x p i r a t i o n
of s u b s c r i p t i o n r i g h t s f o r two stock i s s u e s , . S t a t e and l o c a l
government o f f e r i n g s f o r §h9 m i l l i o n were sold, This week, r i g h t s
expire on corporate i s s u e s t o t a l i n g $78 m i l l i o n a n d . S t a t e and l o c a l
government o f f e r i n g s amounting t o &90 m i l l i o n a r e scheduled f o r s a l e .
The S t a t e and l o c a l government f i n a n c i n g t o t a l i n c l u d e s
the $50 m i l l i o n Connecticut Expressway's revenue bond i s s u e which
was sold Tuesday a t a n e t i n t e r e s t , c o s t of 3.69 p e r c e n t . This
i s s u e i s p a r t of a $75 m i l l i o n i s s u e which was o r i g i n a l l y scheduled
f o r October 30, 1956 but postponed because of market conditions a t
t h a t time. When rescheduled f o r s a l e on November 20, the i s s u e
was reduced t o &5U m i l l i o n and c a n n e d a U.CO per cent c e i l i n g on
i n t e r e s t c o s t . No bids were r e c e i v e d , however. The s u b s t a n t i a l l y
lower r a t e a t which t h e i s s u e was marketed t h i s week i s n o t , howe v e r , an a c c u r a t e measure of t h e easing i n municipal bond markets;
i n order to improve the m a r k e t a b i l i t y of t h e i s s u e , Connecticut made
a number of changes i n terms, such as strengthening the underlying
s e c u r i t y and lengthening t h e c a l l p r o v i s i o n s .
Bond y i e l d s - Changes i n y i e l d s on outstanding bonds were
mixed l a s t week. Yields on U. S, Government (new s e r i e s ) bonds
increased one basis p o i n t and those f o r corporate Baa's remained
s t a b l e . Yields on c o r p o r a t e Aaa, S t a t e and l o c a l government Aaa and
Baa and U. S. Government (old s e r i e s ) o b l i g a t i o n s declined.
On A p r i l 3, Western Massachusetts E l e c t r i c Company's Aa. r a t e d 30-year f i r s t mortgage i s s u e was r e o f f e r e d t o y i e l d 1|»29 per
cent — 7 b a s i s p o i n t s below t h a t f o r the l a s t comparable i s s u e ,
an o f f e r i n g made on Februazy 27.
*5A p r i l e s t i m a t e s - The corporate volume of new c a p i t a l i s s u e s
f o r A p r i l i s estimated a t $900 m i l l i o n , about 30 p e r c e n t below the
estimated March volume, but 10 p e r cent g r e a t e r than t h e volume i n
A p r i l l a s t y e a r . Included i n t h e t o t a l a r e expected l a r g e p u b l i c i s s u e s
t o t a l i n g between $350 and $liOD m i l l i o n . A s u b s t a n t i a l volume i n t a k e downs of p r i v a t e placements i s a l s o expected.




H. 14

-

2 -

S t a t e and l o c a l governments are e.ip ected t o o f f e r #6^0
m i l l i o n of bonds during A p r i l , This would be more than o n e - t h i r d
g r e a t e r t h a n the volume estimated f o r March and t h r e e - f o u r t h s above
l a s t A p r i l ' s volume.
- Stock p r i c e s - The SEC index of 265 common stocks increased
s l i g h t l y l a s t week. Daily f i g u r e s through Wednesday of t h i s week
i n d i c a t e l i t t l e change i n p r i c e s .
More d e t a i l e d information concerning r e c e n t c a p i t a l market
developments i s presented i n the a t t a c h e d e x h i b i t s .

Business Finance and Capital Markets S e c t i o n ,
Division of Research and S t a t i s t i c s ,
Board of Governors of the Federal Reserve System.




HIGH-GRADE

B O N D YIELDS

GOVERNMENT

U. S. Govt., lone-term 2/
DM.

Corporate
Aa,l/

Old series

New series

Spread between
. U. S. Govt,
State and
local govt. (old series) and
Corporate 1 State and
Aaa 3/
Aaa
Ilocal Aaa

(Per cent)
1953 - High

2^99 (1/9? 2*.78 (12/26)

195k - High
1955 - High
1956 - high
1957 - High

March 8
March 15
March 29

3.17 (12/23) r.9h (e/5)
2.91 (1/7)
2.62 (1/7)
3.07 (3/2)
3.82 (l/l*)
3.66 (3/29)

L e o (2/17)
3.53 ( l / w
3.15 (2/8)

3.66

j.27

I

S
3.21

2.73
1.98
2.21
1.90
2.3k
3.03"(8/5)
2.89 (6/10) 2.05
3.39 (12/26) 3.05
2.17
2.92 (2/3)
3.1*5 (1A)
3.05
2.76
3.22 (2/8)
3.28
3.26
3.26
3.28
3.29

2.83
2.90
2.88
2.88
2.86

(6/25)
(1/8)
(6/10)
(9/2)
(9/8)
(5/26)
(12/27)
(2/23)
(1/10)
(2/21)

.38
.19
.1*3
•32
.31*
•13
.a
VL3
.51
.29

.81*
•30
.61
.29
.70

.39
.36
.la
.1*3
.1*5

.1*1*
.1*0
•37
;36
.35

•32
.1*8
.26

1/ Weekly average of daily figures. Average term of bonds included i s 25-26

of 1995 and the 3 1/1* per cent bond of 1978-83.
3/ Thursday figures. Only general obligation bonds are included; average
ten

™ Note?--Highs and lows are f o r individual series and may be on d i f f e r e n t dates
for d i f f e r e n t series.




FXHIBIT B

L O W E R - GRADE B O N D YIELDS

1954

Date

.

1955

Corporate
Baa J /

1956

S t a t e and
l o c a l govt.
Baa 2 /

S t a t e and
local govt,
rev. 3 /

(Per c e n t )
1953 - High

1955 - High
Low
1956 - High

3.89
3.50
3.71;
3.I4U
3.63
3.U5
l+.ia

1957 - High
Low

4.50 (1/18)
k.k2 ( 3 / 2 9 )

March
March
March
March
March

i t i
U.I42
U.U2

1954 - High

1
8
15
22
29

(9/18)
(1/2)
(1/8)
(12/31)
(12/30)

(1Ah)

(12/28)

3.58 (3/9)

U.k7

1.11(8^)
3.26 (12/29)
3.02 (1/6)
U.22 ( 1 2 / 2 7 )
3.20 (3/8)
4.22 (1/10)
3.90 (2/21)
3.99
3.99
3.99
3.97

3.27
2.71
3.00
2.72
2.99
2.76
3.93,
2.89
3.98
3.70

(6/26)
(1/2)
(1/1)
(8/13)
(12/30)
(1/7)
(12/28)
(2/24)
(lA)
(2/22)

3.83
.

>4?

3.93

included i s 25-26 y e a r s .
2/ Thursday f i g u r e s . Only general o b l i g a t i o n bonds are i n cluded; average term i s 20 y e a r s .
3 / Friday f i g u r e s . Average r a t i n g of bonds included i s
between Baa and A; average term i s 20 y e a r s .
k/ S e r i e s d i s c o n t i n u e d .
Note.—Highs and lows are f o r i n d i v i d u a l s e r i e s and may
be on d i f f e r e n t dates f o r d i f f e r e n t s e r i e s .




STOCK MARKET

I
/"

!

'""I

I " STOCK MARKET CREDIT

i

2000

Common
yields y
(per cent)

Stock market customer credit
Customers -,_yank.
debit bal- loans to
ances U/ others" 5/
(Millions of dollars)

' 1953 - High
195k - High
1955 - High
1956 - High
1957 - High
February
March 15
March 22
March 29

167.1 (1/2)

lUt.O (9/18)

221.lt
156.5
270,7
217.lt
295.5
257.k
279.2
260.3

(12/31)
(1/6)
(12/30)
(1/Ut)
(6/3)
(1/20)
(1/W .
(2/8)

262.14
265.1
265.7
265.1
266.2

2.5.
0.9
%
1.5
3.1
1.5
1:1
2.0
1.7

i:Z

1.7

5.88
5.15

It.28
3.91

2,ltlt5
2,055
3,136
2,1,05
It,030
3,537
It,01,7
3,911t
3,903

.3,616

1,665
1,31It
2,388
1,653
2,805
2,517
2,823
2,7lt0
2,762
2,729

It. 27

3,81,6

2,7.29

5.1*9
It.09
It. 23
3.59

ltil8
It.18
It. 16

780.

66k
•1,01,8

71t6

1,2a
1,018

1,267
1,155
1,163
1,117
1,117

l,'l?6
1,121

n.a.—Not available
1/ SEC index of 265 common stocks, weekly closing prices, 1939=100; converted
to 19u7-lt9"100 by Federal Reserve. The conversion factor i s 123.9,1.
2J Averages of daily trading volume on the New York Stock Exchange.
V Moody's 125 industrial stocks; weekly data based on friday.
h/ End of month figures f o r member firms of the i.ev York Stock Exchange which
carry margin accounts; excludes balances secured by V. S. Government obligations.
5/ Wednesday figures f o r weekly reporting member banks. .Excludes loans f o r
purchasing or carrying 0. S. Government securities at banks in New York and Chicago.
Weekly reporting banks account f o r about 72 per cent of loans to others.
Note.—Hi$is and lows are f o r individual series and may be on d i f f e r e n t dates
for different series.




H.1U
Corporate and S t a t e and Local Government
S e c u r i t y O f f e r i n g s and Placements
. (In m i l l i o n s of d o l l a r s )

1957
January
February
March

e/1,039

April
May
June

e/900

New c a p i t a l

Corporate
1956
1

ill
quarter
quarter
quarter
quarter

6/3,364

1 s t half
Three q u a r t e r s
Year

S t a t e and l o c a l
1 1956
I

1955

1957

535
U07
1,223

e/660
e/525
e/500

hoh

696
390

535
312
538

. h78

e/675

378
1+90.
735

61+2

670

3#
199
333

1*06

71.7
1,0885/
l,09ii

1,1621/
632
900

6ii5
311
i+26

919
6#
i;08

2,073
2,789
2,571
2,929

2,165
2,052
1,911
2,695

1,1*90
1,603
908
1,382

1,385
1,1*18
1,121*
1,981*

3,093
ii,001
5,383

2,803
3,927
5,911

579
70ii
790
816
1,114;
830

'886
.687

1,066
669
836

October
November December
1st
2nd
3rd
iith

1

ii,862
7,432
10,362

597
6hk-

•

U,2l6
6,127
8,821

e/l^b:

•

1955

k27

1*70
2h9

Excluding f i n a n c e companies 3 /
1st
2nd
3rd
iith

quarter
quarter
quarter
quarter

e / 3 , l6ii

Year

1,617
2,519
2,263
2,83k
9,233

•

1,727
1,870
z/l,hhk

2,55k

c/7,595

e / Estimated,
1 / Includes ^637,2 m i l l i o n AT&T c o n v e r t i b l e debenture i s s u e .
2j Includes $571.5 m i l l i o n AT&T common stock i s s u e ,
3 / Total new c a p i t a l i s s u e s excluding o f f e r i n g s of s a l e s and consumer f i n a n c e
companies.
*
Note,—Details may not add t o t o t a l s due to rounding.




Exhibit E

H.lU

Large Public Security Issues f o r New Capital
(Other than U. S. Treasury) 1 /
Proceeds of Large Issues Offered
(Millions of dollars)
Month

Corporate

1956 - March
April
May
June
July
August
September.
October
November
December
1957 - January
February
March

278
395
623
185
592
217
558
366
701
1*30
567
671
788

S t a t e and
l o c a l government

Other 2/

163
157
233
163
16U
35
18U
383
135
201
386
306
19k

.

50
20
37
35
100
50
—

Large Individual Issues Offered During March
Issuer
CORPORATE •
Commercial Credit Co.
Anaconda Co.
Columbus & So. Ohio Elec.
Connecticut Lt. & Pwr. Co
Texas Eastern Trans. Corp,
Southern Counties Gas Co.
Commonwealth Edison Co,
Central & South West Co,
Owens-Corning Fiberglas
Corporation
American Natural Gas Co.
Dresser I n d u s t r i e s , Inc.
Consolidated Edison Co.
El Paso Natural Gas Co.
" Appalachian Elec. Pwr. Co.
Public Service Elec. &
Gas Company
Consumers Power Co.
I Lone Star Gas Co.
American Tel. & Tel. Co.
General Public I J t i l . Corp.

Type 2 /

Coupon
Amount
(millions
r a t e or Offering
Maturity
Rating
of
net i n t e r - y i e l d
dollars)
e s t cost

Sub, notes
Common s t k .
1st mtg.bds.
Common s t k .
1 s t artg.F.L. bds.
1 s t mtg, bds.
1 s t mtg. bds.
Common s t k .
Common s t k .
Common s t k .
Conv.sub.deb.
Conv. deb,
Cum.pfd.stk,
1 s t mtg. bds.
Deb.
Common s t k .
Conv.pfd,stk.
Deb.
Common s t k .




1977

h 1/2

1.65

16.0 1987

b 1/2

k.hl

h 7/8
U 5/8
h 1/h

It. 91
U.53
it. 25

A
Aaa

Vl3

Baa
A

25.0
86.7

15.3
iiO.O 1977
i5.o 1982
5o.o 1987
2.1,5
16.3

2h.l

20.0 1977
. 5U.8 1972

15.0
29,0

1987

50.0' 1977

Si

250,0
20.7

1985

k
h

1/8 '
1/2

U 5/8
h

5/8 .

h

3/8

k.50

U.55

•

>.30

A
A

L52
.

Aa

ti.llt

E-2
Large Individual Issues Offered During March (Cont'd)

Issuer

Type 1/

Amount
Coupon
(millions
r a t e or
Maturityof
net i n t e r dollars)
e s t cost

Offering
y i e l d Rating

STATE AND LOCAL GOVERifljENT
Houston Ind. Sch. D i s t . ,
Texas
G.O.
16.8 1958-8?
S e a t t l e , Washington
G.O,
6.5 1959-77
S t a t e of Rhode Island
G.O.
13.0 1958-85
Ferndale Sch. D i s t . , Mich.
G.O.
. 5.5 1958-83
Chicago, I l l i n o i s
Vltr.rev.
15.0 1970-77
Memphis, Tennessee
G.O. •
11.5 1958-87
Brovard Co. Spec. Tax
School D i s t , , Florida
G.O.
6.0 1959-76
Alabama Highway Authority
L.L.
lU.O 1958-76
Cojnmcnwealth of Mass.
G.O.
20.2 1958-77
Dade Co. Tax D i s t r i c t
No. 1, Florida
G.O.
10.0 1959-76
Glendale, California
Elec.rev.
6.5 "1958-77 •
Louisiana S t . Bldg, Auth.
L.L.
9.9 1962-71
S t a t e of South Carolina
G.O.
10.0 1958-77
Commonwealth of Puerto Rico
G.O.
10.0 1958-77
State of Ohio
Thoroughfare rev. 32.0 1957-72
Palm Beach School D i s t r i c t
No. 1, Florida
G.O.
6 . 9 1959-78

3.50

3.21
3.19

h.Oh

3.66
3.03

A
2.35-3.50
2.35-3.25 A
2.00-3.25 A
2.60-Loo Baa
3.1*0-3.60 A
Aa
2.00-3.10

3.60

2,70-3.60
2.1*0-3.65
2.00-3.05

A
A
Aa

3.62
3.06

2.70-3.65
2.20-3.05
3.20-3,75
2.00-2.85
2.60-3.70

A
Aa
Baa
Aa
A
Aa

3.63
3.03

3.00

2.83
3.73
2.91
3.55

2.00-2.90
2.60-3.55

n.a.

OTHER
_L
n. a. —Not a v a i l a b l e .
1 / Includes corporate and other s e c u r i t y o f f e r i n g s of &15 million and overj
S t a t e and l o c a l government s e c u r i t y o f f e r i n g s of is>5 million and over.
2 / Includes f o r e i g n government and Internationa^ Bank f o r Reconstruction and
Development i s s u e s .
3 / In the case of S t a t e and l o c a l government s e c u r i t i e s , G.O. denotes general
o b l i g a t i o n ; Rev., revenue bonds; G.R., general obligations a d d i t i o n a l l y secured by
f a c i l i t i e s revenues3 L.L., limited l i a b i l i t y obligations secured by pledge of
designated revenues.




Exhibit F

H.lU

Forthcoming Large Public S e c u r i t y O f f e r i n g s f o r New C a p i t a l
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues
During month f o l l o w i n g
date shown
S t a t e and
Corporate l o c a l govt. Other 2 /

Date of
computation

380
568
198
437
2b7
369
315
683
U36
ii76
591

1956 - Mar. 30
Apr. 30
May 31
June 29
J u l y 31
Aug. 31
Sept. 28
Oct. 31
Nov. 30
Dec. 31
1957 - Jan. 31
Feb. 28
Mar. 29

7h0

1*61

132
173
332
81
131
359
162
i|6
280
153
153
390

Subsequent t o
date shown
Corporate | ^ c a ^ g o " !
1,013
818
lw8
567
1,096
1,202
1,009
990
U81
796
966
795
U86

—
——

37

23
100
35
25

811
832
9itl
690
726
958
1>197
955
979
763
648
631.
862

other

2/

——

37

23
100
35
25

Forthcoming Large O f f e r i n g s , a s . o f March 29
Issuer

Type

Amount
( m i l l i o n s Approximate date
I of d o l l a r s ) ; of o f f e r i n g

CORPORATE
El Paso Natural Gas Co.
Baltimore Gas & E l e c t r i c Co.
Southern Company
Aluminum Co. of Canada, Ltd,
•frSears Roebuck Acceptance Corp.
Houston Lighting & Power Co.
U. S. F o i l Co.
Reynolds Metals Co.
Quebec Natural Gas Corp.
Quebec Natural Gas Corp.




Conv. 2nd p f d . s t k .

* April 2
( r i g h t s expire)
April 3
17.9
.. ( r i g h t s expire)
Common s t k .
A p r i l .1*
30.-1 '
( r i g h t s expire)
S.F. deb.
125.0
A p r i l 11
Sub. deb.
25.0
A p r i l 12
Common s t k .
April 15
26.3
(rights expire)
Common s t k .
20.2
A p r i l 16
( r i g h t s expire)
Common s t k .
20.1
A p r i l 16
( r i g h t s expire)
1 s t mtg, bds.
25.0
A p r i l 16
1 Sub. deb. & common 15.0
A p r i l 16
Common s t k .

30.0

H.lli

Forthcoming Large Offerings., a& of March 29 (Cont'd)
Issuer

Amount
( m i l l i o n s Approximate date
of o f f e r i n g
of d o l l a r s )

Type

CORPORATE (Cont'd)
-^Transcontinental Gas Corp.
Columbia Gas System, I n c .
Babcock & Wilcox Co.
-^-Northwestern Bell Telephone Co.
Michigan Wisconsin Pipe Line Co.

1 s t ratg, bdSi
Common s t k .

50.0
26, k

* C a p i t a l stk,

20.0

Deb,
1 s t mtg. bds.

30.0
25.0

A p r i l 18
A p r i l 22
( r i g h t s ejgpire)
A p r i l 22
( r i g h t s expire)
A p r i l 2U
1957

.ST&TE AND LOCAL GOVERNMENT
J e f f e r s o n Co., Texas
• Los Angeles City Sch. D i s t . , C a l i f .
S t a t e of Connecticut
H a r r i s Co. Navigation D i s t . , Texas
Miami, F l o r i d a
Lynchburg, Virginia
Ohio S t a t e University
- S t a t e of Michigan
J a c k s o n v i l l e Expressway Authority
Public Housing A u t h o r i t i e s
*St. Paul, Minnesota
Milwaukee, Wisconsin
Orleans Par, Sch. D i s t . , La.
P h i l a d e l p h i a , Pennsylvania
^•State of Oregon
*New. York, New York
S t a t e of C a l i f o r n i a
e s t a t e of Ohio
Jacksonville, Florida
F l o r i d a S t a t e Turnpike Authority
Pennsylvania* Turnpike Commission
Inter-American C<wi.er Auth,, F l o r i d a
New York S t a t e x'hruway Authority
Oklahoma Turnpike Authority

G.O,
G.O,
Expressway r e v ,
G.O,
G.O.
Wtr. & swr. r e v .
Dormitory r e v ,
Expressway r e v .
Rev,
G.O,
G.O.
G.O,
G.O.
G.O,
G.O.
G.O,
G.O,
Utilities
Rev,
Rev.
Rev.
• G.O,
Rev.

5.h

20.0
50,0
7.0
7.5
5.0
6.0
25.0
iiil.l
36.1
6.7
22.2
5.0
. 29.5
10.0
30,5
80.0
60.0
rev.
30.0
185.0
62,0
20.0
50.0.
65.0 .

April 1
April 2
April 2
April 3
April 3
April 8
April 8
April 9
April 9
A p r i l 10
April 10
A p r i l 16
A p r i l 17
A p r i l 17
April 18
A p r i l 23
A p r i l 2h
May 1
May 9
July 1
1957
1957
1957
1957

OTHER
High Authority of t h e European
Bonds
A p r i l 10
Coal and S t e e l Community
25.0
—Included i n t a b l e f o r f i r s t time.
1 / Includes corporate and other i s s u e s of $15 m i l l i o n and over5 S t a t e and
l o c a l government i s s u e s of $5 m i l l i o n and over.
2 / Includes f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction
and Development i s s u e s .
Note.—Deletions f o r reasons o t h e r than s a l e of i s s u e : Melbourne, F l o r i d a ,
§6.8 m i l l i o n water and sewer revenue i s s u e — no bids r e c e i v e d .




H.14

Exhibit G
Yields on New and Outstanding
E l e c t r i c Power Bonds, Rated Aa and A

Date
1952 - 1956
High
Low

A-rated o f f e r i n g y i e l d s
Aa-rated o f f e r i n g y i e l d s
Amount above
Amount above
Actual
Actual
seasoned y i e l d s
seasoned y i e l d s
(per cent) ( b a s i s points) (per cent) (basis p o i n t s )
U. 30(12/12/'56)
2.93(3/31/54)

1956 - January
February
March
April
May
June
July
August
September
October 10
. 31
November 21
December 6
12
1957 - January 8
16
18
22
2k

February 5
19
27
March 6
12
20
29

62
- 3

None
*3.15
3.28
*3.77
*3.53
*3.52
3,66
*U-07
1.13

3
11
. k)
19
18
29
52
53

1.20
4.30

48
52

4.30

47
62

4.50
4.43
4.40
4.29
4.25
4.22

.

56

-

53
45
46
43

4.58(12/6/!# )
3.00(3/17/54)
None
3.23
3.45
3.61
3,76
*3,75
*3.82
*4.oo
None
4.40

70
-15
- 6.
15
26
28
27
28
43
63

4.58

70

4.67

70

4.56

57

4.41
4.58
4.55
4.45

.

35
52
49
43

*—Single observation, not an average.
1 / Covers only.30-year f i r s t mortgage bonds, as r e p o r t e d i n Moody's Bond
Survey. Except where i n d i c a t e d , t h e a c t u a l y i e l d f i g u r e and the amount above
seasoned y i e l d s a r e averages of o f f e r i n g s during the i n d i c a t e d p e r i o d and of
the d i f f e r e n c e s between these new o f f e r i n g y i e l d s and y i e l d s on seasoned i s s u e s
of s i m i l a r q u a l i t y f o r t h e same day. Average maturity f o r the seasoned i s s u e s
v a r i e s from 26 to 28 y e a r s .