Full text of H.16 Capital Market Developments : August 15, 1957

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DECONTROLLED AFTER SIX MONTHS

August 15 s 1957

H.li;

CAPITAL MARKET DEVELOPMENTS

Large publicly offered securities during the week ending
August 9 included a $100 million corporate offering and State and
local government issues totaling $90 million. This week, a single
corporate offering for $18 million and State and local government
issues with aggregate proceeds of $98 million are expected.
Bond yields - Yields increased last week for every category of outstanding bonds, except for U. S. Government (old series)
obligations which declined slightly. The increase was substantial
for the State and local government bond yields — 9 basis points
for the Aaa's and 11 points fqr the Baa's.
Yields on new corporate issues also continued to increase.
An Aa-rated first mortgage electric utility issue was offered to
investors this week to yield 5.00 per cent — 35 basis points above
that for a comparable issue offered in mid-July.
Stock prices - Stock prices, as measured by the SEC index
of 265 common stocks declined U«2 points last week, closing at 282.1
on August 9. Daily figures for the first three days of this week
indicate further decline in prices particularly on Wednesday.
More detailed information concerning recent capital market
developments is presented in the attached exhibits.

Business Finance and Capital Markets Section,
Division of Research and Statistics,
Board of Governors of the Federal Reserve System.




EXHIBIT A

HIGH-GRADE BOND YIELDS

\ U. S. GOVERNMENT:/*
V ! long-t.im
'/

V _ A

J / 7

U. S. Govt., long-term £j
Corporate
Aaa y

Old series

-New series

State and
local govt.
Aaa j /

Spread between
U. S. Govt.
(old series) and

(Per cent)
3.12
2.99
3.09
2.85
3.17
2.91
3.79
3.07
h.07

(6/19)
(1/9)
(1/8)
(It/23)
(12/23)
(V7)
(12/28)
(3/2)
(8/9)

3.66 (U/12)

3.97
3.98
14.01
1.05
h.07

3.15 (6/6)

2.78 (12/26)
2.7k (1/9)
2 . W (8/7)
2.9U (8/5)

2.62 (1/7)
3.1»9 (12/21)
2.80 (2A7).

3.70 (6/21)
3.15 (2/8)
3.58
3.63
3-61*
3.62

1/ Weekly average of daily figures.

3.03
2.89
3.39
2.92
3.63

a.
2.73
a.
1.98
a.
2.21
a.
1.90
(8/5) 2.31
(6/10) 2.05
(12/28)3.05
(2/3) 2.17
(8/9) 3.3k

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

.19
.13
.*3U

:£

3.22 (2/8) 2.76 (2/21)

.25

1

.35

f,
.29

1

• 32
.h9

.26
•U7

3.22

:S

.US

Average term of bonds included is 25-26

2/ Weekly averages of daily figures. The old series includes fully taxable,
marketable 2 1/2 per cent bonds due or first callable after 12 years through
September 1955, and those due or callable in 10-12 years thereafter; the average
term to first call of the bonds included,declined from Uj years in early 1953 to
11 1/2 years in early 1956. The new series is comprised of the 3 per cent bond
.of 1995 and the 3 1/U per cent bond of 1978-83y Thursday figures. Only general obligation bonds are Included; average
term is 20 years.
.
Note.—Highs and lows are for individual series and may be on different dates
for different peries.




EXHIBIT B
LOWER - GRADE BOND YIELDS

V

Date

!

Corporate
Baa 1/

State and
local govt.
Baa 2/

State and
local govt,
rev. J /

(Per cent)
1953 - High
195U - High

3.89
3.50
3.71*
3.Wi
3.63
3.15
U.bl

(9/18)
(1/2)
(1/8)
(12/31)
(12/30)
(l/ll)
(12/28)

1955 - High
Low
1956 - High
Low
1957 - High
Low

3.58(3/9)
k.78 (6/9)
h.U2 (V12)

July 12
July 19
July 26
August 2
August 9

14-72
U.72
U.lh
u.ie
li.78

3.79 (6/25)
2.96(1/8)
3.32 (1/7)
2.93
3.26
3.02
h.22

(8/5)
(12/29)

(1/6)

(12/27)

3.20 (3/8)

•u.ia (8/8)

• 3.90 (2/21)
h.21*

3.27
2.71
3.00
2.72
2.99
2.76
3.98
2.89

(6/26)
(1/2)
(1/1)
(8/13)
(12/30)
(1/7)
(12/28)
(2/21*)

3.98 ( 1 / U

3.70 (2/22)
y

U.28

L.30

1.30 L.ia

included is 25-26 years.
2/ Thursday figures. Only general obligation M n d s are included ; average term is 20 years.
3/ Friday figures. Average rating of bonds included is
between Baa arid A; average term is 20 years.
h/ Series discontinued, as of March 15.
Note.—Highs and lows are for individual series and may
be on different dates for different series.




STOCK MARKET

^

Date

Stock price
index 1/

Trading
Common
volume 2/
(millions
yields 3/
of shares) (per cent

Stock market customer credit
Customers'
debit bal- loans to
"others" 5/
ances h/

Total

(Millions of dollars)
1953 - High
195a - High
1955 - High

167.1
lhh.0
221.lt
156.5
270.7
217.k

(1/2)
(9/18)
(12/31)
(1/6)
(12/30)
(1/1W

1956 - High

295.5 (8/3)

1957 - High
; Low

257.U (1/20)
29h.6 (7/12)
260.3 (2/8)

June
July
August 2
August 9

286.2
292.0
290.1
286.3
282.1

2.5
0.9
-3.7
1.1*
1*.6
1.5
3.1
1.5
2.7
1.6
2.2
2.2
1.6
1.8
1.9

.

'
.

5.88
5.15
5.1*9
1.09
It.23
3.59
U.13
3.65
li.28
3.67
. 3.79

3.75

• 3,91k

1,665
1,311*
2,388
1,653
2,805
2,517
2,823
2,71*0

4,031
3,832

1,713

1,031

2,887

n.a.

n.a.

2M S
2,055
3,136
2,1*05
4,030
3,537
li,0U7

3.69
3.76

3.8V

2,887

7 80
66U
1,01*8
71*6
1,21*1
1,018
1,267
1,155
1,1631,117
1,11*1*
1,119
1,120
1,119
n.a.

n . a . — N o t available.
1/ SEC index of 265 common stocks, weekly closing prices, 1939*100; converted
to 19u7-l*9-100 by Federal Reserve. The conversion factor is 123.91.
2/ Averages of daily trading volume on the "ew ^ork Stock Exchange.
3/ Moody's 125 industrial stocksj weekly data based on Friday.
5/ End of month figures for member firms of the New York Stock Exchange which
carry margin accounts; excludes balances secured by U. S. Government obligations.
5/ Wednesday figures for weekly reporting member banks. Excludes loans for
purchasing or carrying U. S. Government securities at banks in New York and Chicago.
Weekly reporting banks account for about 72 per cent of loans to others.
Note.—Highs and lows are for individual series and may be on different dates
for different series.




Exhibit D
Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)

New Capital
1957

1

Corporate
1956
I'

January
February
March

1,063
1,071
1,344

573
712
817

535
.407
1,223

April •
May
June

92k
771
1,489

818
1,146
841

478
886
687

e/1,075 .
e/900 •

1,063
651
838

597
644
670

July
August
September
October
November
December
1st
2nd
3rd
4th

quarter
quarter
quarter
quarter

1st half
Three quarters
Year

3,U79
3,184

6,663

State and local
1
1956
I

1955

685
566
499

* 404
6#
390

535
312
538

762
528
e/380

378
490
735

427
350
642

e/480
e/425

376
199
333

470
249
406

645
311
426

919
658
408

1,490
1,603
908
1,382

1,385
1,418
1,124
1,984

3,093
4,001
5,383

2,803
3,927
5,911

1957

1955

'

745 .
1,0892/
1,088

1,1621/
632
POO

2,102
2,805
2,556
2,922

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

4,907
7,1,63
10,381

4,216
6,127
8,821

1,750
e/1,670

e/3,420

Excluding finance companies
1st
2nd
3rd
4th

quarter
quarter
quarter
quarter

3,268
e/2,884

Year

1,647
2,541
2,246
2,826

1,444
2,554

9,259

7,595

1,727
1,870

'

e/ Estimated.
1/ Includes $637.2 million AT&T convertible debenture issues.
2/ Includes &571»5 million AT&T common stock issues.
3/ Total new capital issues excluding offerings of sales and consumer finance
companies.
Note.—Details may not add to totals due to rounding.




,

•.
!

H.'lii

Exhibit E
Large Public Security Issues for New Capital
(Other than U. S. Treasury) 1/
Proceeds of Large Issues Offered
(Millions of dollars)

Month

Corporate

1956 - July
August
September
0 ctober
November
December
1957 - January
• February
March
April
May
June
July

^

State and
local government

. 164
.35
184
383
135
201
386
306
194
499
248
176
265

592
2YT

558
386
701
U30
567
671
788
477
329
877
525

Other 2/

__
37
35
100
5o
125
25
39
25

Large Individual Issues Offered August 1 through 9

Issuer

Type 2 /

Amount
Coupon 1
(millions Maturity rate or I Offering
Rating
of
net intex
yield
dollars)
est cost ,

CORPORATE
Minneapolis-Honeywell
Regulator Company
Associates Investment Co.
General Motors Acceptance
Corporation

Common stk.
Deb.

28.2
50.0

1977

5 1/4

5.25

Deb.

100.0

1977

5

5.20

O.R.

35.0

STATE AND IOCAL GOVERNMENT
State of Connecticut
Du Page Co. H.S.D. No.
California
Sacramento Unif. 5.D.,
California
Chicago, Illinois
OTHER
None




0.0.
0.0.

0.0.

1963-97/65

3.61

2.80-3.65

Aaa

7.9

1956-76

4.23

2.80-4.25

A

7.0
39.6

1959-82
1959-76

3.U9
3.8k

2.50-3.55
2.85-3.85

Aa
A

H.lU

1/ Includes corporate and other security offerings of $15 million and over;
State and local government security offerings of $$ million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues.
i / In the case of State and local government securities, G.O. denotes general
obligation; Rev., revenue bonds; G.R., general obligations additionally secured by
facilities revenues; L.L., limited liability obligations secured by pledge of
designated revenues.




i

H.ll*

Exhibit F
Forthcoming Large Public Security Offerings for New Capital
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues
Subsequent to
During month following
date shown
date shown
State and
State and
Other 2/
Other 2/ Corporate
Corporate
local govt.
local govt.

Date of
. computation

1956 - July 31
Aug. 31
Sept. 28
Oct, 31
Nov. 30
Dec. 31
1957 - Jan. 31
Feb. 28
Mar. 29
Apr. 30
May 31
June 28
July 31

2l*7
369
315
683
1*36
1*7 6
591
7h0

l*6l
187
525
370
526

37
131
359
162
1*8
280
153
153
290
179
97
172
252

23
100
35
25
25
25

1,096
1,202
1,009
990
1*81
796
966
795
1*86
258
525
1*15
811

726
958
1,197
955
979
763
61*8
631
862
396
388
1*98
511*

37

23
100
35
25
25
25

Forthcoming Large Offerings, as of August 9

Issuer

Type

Amount
Approximate date
(millions
of offering
of dollars)

1st mtg. bds.
Conv. sub. deb.

18.0
20.3

, Pacific Telephone & Telegraph Co.
Atlantic Refining Co.
Thompson Products, Inc.

Deb.
Conv. sub. deb.
Conv. sub. deb.

90.0
100.0

Southern California Edison Co. ,

* 1st & ref.
mtg. bds.
1st & ref.
mtg. bds.
1st mtg. bds.
S.F. deb.
Conv. deb.

Northern States Power Company
j. Ray McDermott and Co,

Public Service Electric & Gas Co.
Tampa Electric Co.
*Duke Power Co.
*E1 Paso Natural Gas Co.
Pacific Telephone & Telegraph Co.
American Telephone & Telegraph Co.




Common stk..
Deb.

19.7

August ll*
August 20
(rights expire)
August 21
August 21
August 27
(rights expire)

1*0.0

August 28

60.0
18.0
50.0
60.0

August 29
September 6
September 11
September 11
(rights expire)
September 30
(rights expire)
October 29

17.2
250.O

R'.Ui"

F-2
Forthcoming Large Offerings, as of August 9 (Cont'd)

Issuer

Type

Amount
Approximate date
(millions
of offering
of dollars)

STATE AND LOCAL GOVERNMENT
Los Angeles City Sch. Dists., Calif.
0.0.
New York, New York
0.0.
Tampa, Florida
0.0;
Dade County, Florida
0.0.
Nassau Co., New York
0.0.
State of Massachusetts
o.o..
Kansas Turnpike Authority
Rev.
•Omaha Public Power Dist., Nebraska
Elec. rev.
San Jose, California
0.0.
•State of South Carolina
0.0.
•State of Rhode Island
0.0.
•Chicago Bd. of Educ., Illinois
G.O.
•Santa Monica Unif. Sch. Dist.,Calif.
0.0.
Dade Co.,Spec. Tax. S.D. No. 1, Fla.
G.O.
State of Ohio
Highway rev.
•Los Angeles, California
G.O.
•State of Missouri
0.0.
Pennsylvania Gen. State Authority
Rev.
G.O.
San Diego Unified Sch. Dist., Cailif.
State of Texas
i
G.O.
Jacksonville, Florida
Utilities rev.
University System Bldg. Auth., Ga.
Rev.
Pennsylvania Turnpike Commission
Rev.
Inter-American Center Auth., Fla.
Rev.
New York State Thruway Authority
0.0.

-

a.o
k0.0
6.3
7.5
21.0
19.0
19.5
8.0
5.0
6.0
6.7
15.0
5.0
9.5
31.0
5.0
30.0
25.0
10.0
12.5
30.0
12.0
62.0
20.0
50.0

Aug. 13
Aug. 15
Aug. 15
Aug. 15
Aug. 19
Aug. 20
Aug. 20
Aug. 20
Aug. 21
Aug. 21
Aug. 21
Aug. 28
Sept. 3
Sept. U
Sept. 10
Sept. 11
Sept. 17
Sept. 19
Oct. 15
1957
1957
1957
1957
1957
1957

OTHER
None
•—Included in table for first ime.
1/ Includes corporate and other issues of $15 Billion and over3 State and
local government issues of $5 million and over.
2/ Includes foreign government and International Bank for Reconstruction
and Development issues.
Note.—Deletions for reasons other than sale of issue: None.