Full text of H.16 Capital Market Developments : January 19, 1956

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Mot f o r P u b l i c a t i o n

MComomn, ^

SIZ

„

H.llj.

January 19, 1956
CAPITAL MARKET DEVELOPMENTS

• The volume of l a r g e public s e c u r i t y o f f e r i n g s f o r the week of
January 13 was s l i g h t l y g r e a t e r than i t h'as been t h e l a s t few weeks,
d e s p i t e the f a c t t h a t f o r t h e f o u r t h consecutive week t h e r e was no
corporate f i n a n c i n g . S t a t e and l o c a l governments sold $62 m i l l i o n
of l a r g e o f f e r i n g s and are scheduled to f l o a t $58 m i l l i o n t h i s week.
No l a r g e corporate i s s u e s were scheduled e i t h e r l a s t week or t h i s
week.
Not included i n the above s t a t i s t i c s since i t i s not a
new i s s u e i s the o f f e r i n g by the Ford Foundation of 10.2 m i l l i o n
shares of common stock in the Ford Motor Company.
The stock was
o f f e r e d on January 17 at #61;«50 per s h a r e . Reports i n d i c a t e d t h a t
the stock was s e l l i n g a t a premium i n the over-the-counter market.
Bond y i e l d s declined - Yields on outstanding bonds decreased g e n e r a l l y during the week ending January 1-3. S t a t e and
l o c a l government revenue bond y i e l d s dropped t h r e e basis p o i n t s ;
other y i e l d s declined more moderately as can be seen i n the attached
e x h i b i t s . Yields on corporate Aaa, Baa and U. S. Government longterm bonds declined f u r t h e r the f i r s t two days of t h i s week.
Stock market c r e d i t - Customer c r e d i t i n t h e stock market
rose $U5 m i l l i o n i n December to t o t a l $U,025 m i l l i o n a t the end of
the y e a r . Customers' n e t d e b i t balances accounted f o r $27 m i l l i o n
of the i n c r e a s e ; bank loans t o " o t h e r s " f o r t h e remaining $18 m i l l i o n . Money borrowed by brokers and d e a l e r s on customer c o l l a t e r a l
increased $75 million t o $1,816 m i l l i o n .
The following t a b l e shows these and other d a t a on stock
market c r e d i t f o r November and December.
End of month
,
1 Change
November |December |
(Millions of d o l l a r s )
Customer c r e d i t
i
1
Excluding U. S. Govt, s e c u r i t i e s - Total
' 3,980
+U5
L,025
Net d e b i t balances
'
+27
27785
27759
Bank loans to "others"
i 1,221
+18
1,239
Net d e b i t balances secured by U. S. Govt, s e c u r i t i e s
38
3h
-k
Bank loans to others f o r purchasing or carrying
U. S. Govt, s e c u r i t i e s
27
32
Broker and d e a l e r c r e d i t
Money borrowed except on U. S. Govt, s e c u r i t i e s
On customer c o l l a t e r a l
Money borrowed on U. S. Govt, s e c u r i t i e s
Customers 1 n e t f r e e c r e d i t balances




;

2,185
l,7kl
75
876

2;2U6
1,816
51
895

+61
+75
-2U
+19

-2—

Stock p r i c e s - The SEC index of 265 common stocks decreased moderately to 266.2 during the week ending January 13.
Stock p r i c e s declined on balance through Wednesday of t h i s week.
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 t h e attached 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.




H I G H - G R A D E B O N D YIELDS
Weekly

CORPORATE A a a

U. S. GOVERNMENT

STATE AND LOCAL
GOVERNMENT A cm

Corporate
Aaa 1 /

Date

U. S. Govt,
long-term 2 /

State and l o c a l
govt., Aaa 3 /

Spread between
U. S. Govt, and
Corporate State and
Aaa
local Aaa

(Per cent)
3.k2
2.99
3-09
2.85
3.17
2.91

1953 - High
Low
195k - High
Low
1955 - High
Low
December 16
December 23
December 30
January 6 .
January 13

;

(6/19)
(1/9)
(1/8)
(U/23)
(12/23)
(1/7)

3.17
3-17
3.16
3.1k
3.13

3-15
2.78
2.71
2.UU
2.9k
2.62
2.88
2.88
2.89
2.90
2.88

(6/6)
(12/26)
(1/9)
(8/7)
(8/5)
(1/7) "

2.73
1.98
2.21
1.90
2.3k
2.05
2.30
2.30
2.30
2.29
2.27

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

.38
.19
• k3
• 32
•3k
.13

.8k
.30
.61
.29
.70
• 5k

.29
.29
.27
.2k
.25

.58
.58
.59
.61
.61

years 2/ Weekly average of daily figuresj old s e r i e s . Average term to f i r s t c a l l
of bonds included i s 11-lk years.
3/ Thursday figures. Only general obligation bonds are included; average
tern i s 20 years.
Note.—Highs and lows are for individual s e r i e s and may be on d i f f e r e n t dates
for d i f f e r e n t s e r i e s .




EXHIBIT B

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

W

STATE AND LOCAL GOVT.

STATE AND LOCAL GOVT. REVENUE

"Corporate
Baa 1 /

Date

State and
l o c a l govt.
Baa 2 /

State and
l o c a l govt.

(Per cent)
1953 - High
Low
1951 - High
Low
.1955 - High
Low

3.89
3.50
3-7U
3-UU
3.63
3.15

December 16
December 23
December 30
January 6
January 13

3-62
3-63
3-63
3.62
3.61

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

3.79 (6/25)
2.96(1/8)
3.32 (1/7)
2.93 (8/5)
3.26 (12/29)
3.02 (1/6)

3.27 (6/26)
2.71 (1/2)
3.00 (1/1)
2.72 (8/13)
2.99 (12/30)
2.76(1/7)

3.25
3.25
3.26
3.26
3.25

2.99
2.99
2.99
2.9U
2.91

re terra of bonds
•Pi OtnirAS.
Averai—
J-/ nCCTLJ-J
wv
included i s 25-26 years.
2j Thursday figures. Only general obligation .bonds are
included; average terra i s 20 years.
. , , . .
V Friday figures. Average rating of bonds included i s
between Baa and A; average term i s 20 years.
Note.—Highs and lows are for individual s e r i e s and may
be on d i f f e r e n t dates for different s e r i e s .




STOCK MARKET

Date

Stock price
index 1/

Trading
Common
volume 2 /
(millions yields 3/
of s h a r e s ) ( p e r cent)
•-

1955 - High
Low

167.1
lUU.O
221.U
156.5
270.7
217.k

November
December
December 30
January 6
J anuary 13

265-0
269.2
270.7
268.8
266.2

1953 - H i g h
195U - High

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

( M i l l i o n s of d o l l a r s )

2,hk5

3,537

1,665
1,311
2,388
1,653
2,805
2,517

U.06-

U.09

3,980
1,025

2,759
2,786

n.a.

n.a.

n.a.

2.5
0.9
3-7
1.U
U.6
1.5

5-75
5.15
*•33
U.20
U.22
3-78

2.3
2.It
2-3
2.U

2.3

Stock market customer c r e d i t
Customers'
Total debit b a l - loans to
a n c e s U/ " o t h e r s " 5 /

2,055

3A36

2,U05

1,025

780

66k
1,0U8
. 716
1,2U1
1,018
1,221
1,239
1,239
1,253
n.a.

n.a.—Not available.
1 / SEC i n d e x of 265 common s t o c k s , w e e k l y c l o s i n g p r i c e s , 1939=100; c o n v e r t e d
t o 19H7-U9=100 by F e d e r a l R e s e r v e . The c o n v e r s i o n f a c t o r i s 1 2 3 . 9 1 .
2 / A v e r a g e s c." d a i l y t r a d i n g volume on t h e New York S t o c k E x c h a n g e .
3/ Moody's 200 common stocks; end of month figures.
t / End of month f i g u r e s f o r member f i r m s of t h e New York S t o c k Exchange which
c a r r y - m a r g i n a c c o u n t s ; e x c l u d e s b a l a n c e s s e c u r e d by U. S . Government o b l i g a t i o n s .
5 / Wednesday f i g u r e s f o r w e e k l y r e p o r t i n g member b a n k s . E x c l u d e s a l l l o a n s
f o r p u r c h a s i n g o r c a r r y i n g U. S . Governments f o r 1952; s i n c e 1 9 5 3 o n l y t h e s e l o a n s
a t b a n k s i n New York and C h i c a g o a r e e x c l u d e d . Weekly r e p o r t i n g b a n k s a c c o u n t f o r
a b o u t 72 p e r c e n t of l o a n s t o o t h e r s .
Note.—Highs and lows are for individual series arid may be on different dates
for different series.




H.lLt

Exhibit D

^

'

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
( I n m i l l i o n s of d o l l a r s )

19-56
J anuary
February
March

e/500

April
May
June
July
August
September

'

Corporate
1955
1
1

f 1st quarter
• 2nd q u a r t e r
3rd q u a r t e r
lith q u a r t e r
Year

S t a t e and l o c a l
1
1955
1

1954

1956

Sh6
U6
1,261

547
• 426
63$

e/325

U9U
903
697

197
656
842

127
350
6Ul •

#3
654
680

909
335
747

470
249
uo6

279
261
619

1,003
290
604

919
e/62S
e/kOQ

594
L23
877

1,608
1,995
1,991
1,896
7,490

1,385 '
1,1*18
1,12U
e/l,9U5
e/5,870

1,138 y
601
^850

October
November
December

New c a p i t a l

2,243
2,094
1,917
e/2,590
i/8,845

1954
#6
Uii
565

535
312
238
.

734
718
853

1,372
2,33k
1,188
1,891
6,78?

Excluding f i n a n c e companies 2f
1st quarter
2nd q u a r t e r
3rd q u a r t e r
Uth q u a r t e r
Year

1,791
1,912
1,441
e/2,390
e/7,535

1,527
1,927
1,911
1,792
7,158

1 / I n c l u d e s $637*2 m i l l i o n AT&T c o n v e r t i b l e d e b e n t u r e i s s u e .
2/ T o t a l 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 p e r s o n a l f i n a n c e
companies.
N o t e . — D e t a i l s may n o t add t o t o t a l s due t o rounding.

t




HtlU

Exhibit E
Large Public S e c u r i t y i s s u e s f o r New C a p i t a l
(Other than U. S. Treasury) l /
Proceeds of Large Issues Offered
(Millions of d o l l a r s )
Corporate

Month

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

121
lbl
63
750
173
U83
175
101
U05 .
. 328
805
269
215

1954 - December
1955 - January .
February
March
April
May
June
July
August
September
October
November
December

Other 2 /

689
3Ul
107
337
238
152
h03
278
65
23U
716
396
205

30
35
15

25
50

Large I n d i v i d u a l Issues Offered January 2 through 13
Issuer

Type 3/

Amount
Coupon
(millions Maturity
r a t e or O f f e r i n g Rating
of
net i n t e r yield
dollars)
e s t cost

CORPORATE
None

.

STATE & LOCAL GOVERNMENT
Wayne County Sewer
System, Michigan
P l a t t e County, Missouri
Allegheny Co., Pa.
Los A n g e l e s , . C a l i f •
S t a t e of Colorado
D e t r o i t , Michigan
OTHER
None




G.O.
Rev.
G.O.
G.O.
L.L.
Rev.

* 6.7
5.U
6.0
1+0.0
8.0
8.0

1956-93
1986
1957-86
1957-76
1957-71
1961-76

3.21
2.53
2.58
2.29
2.hi

1.90-3,20
3/75
1.75-2.60
1.80-2.65
1.70-2,-25
2.10-2.15

A
n.a.
A
Aa
Aa
Aa

2-2

n.ao—Hot 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 m i l l i o n and over; 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
mill 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 Recons t r u c t i o n and Development i s s u e s .
3/ In t h e 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.j general o b l i gations a d d i t i o n a l l y secured by f a c i l i t i e s revenues; L.L., l i m i t e d
l i a b i l i t y o b l i g a t i o n s secured t y pledge of designated revenues.




H.lU,

Exhibit F

Forthcoming Large Public S e c u r i t y Offerings f o r New Capital
(Other than TJ. S. Treasury) 1 /
Expected Proceeds from Forthcoming Large I s s u e s
During month following""
'date shorn "
Corporate T S t a t e and Other 2/
[ l o c a l govt.

Date of
computation
Dec. 31
Jan. 31
Feb. 28
Mar. 31
Apr. 29
May 31
June 30
July 29
Aug. 31
S e p t . 30
Oct. 31
Nov. 30
Dec. 30

18U
16
710
211
L25
160
67
U07
222
805
202
215
70

'

567
632
52U
208
116
339
316
100
18U
81t3 .
330
205
121

——

50
—

Subsequent t o
d a t e shown
S t a t e and I other 2/
Corporate
l o c a l govt.I
216
U22
1,395
922
l,lkl
856
830
1A35
9 20
909
U12
230
65

35

2,lhk

1,961
1,978
2,009
1,917
1,861
1,8U5
2.018
1,971
2,205
1,650
756
618

50

Forthcoming Large O f f e r i n g s , as of January 13
Amount
Approximate d a t e
(millions
of o f f e r i n g
of d o l l a r s ) j

Issuer

Commercial Credit Co.
Textron-Ameri can
Northwestern B e l l Telephone
Texas U t i l i t i e s
B e l l Telephone of Pennsylvania
*New York Telephone
^Southern C a l i f o r n i a Gas
Sheraton Corporation of America
^•Reynolds Metals

Senior notes
Conv. deb.
Deb.
Com,. stock
Deb.
Ref. mtg. bds.
Mtg.. bds.
Deb.
Pfd.. stock

5o.o
30.0
25.0
15.0
35.0
55.0
Uo.o
15.0
W.o

L.L.
G.O.
G-0.

5-9
9.5
5-2
20.0
5-2
5.0

January 25
January 26
February 1
February 1
March 6
-March 27
March
' 1956
1956

STATS AND LOCAL GOVERNMENT
•^Gwinnett.County, Georgia
San Diego, C a l i f o r n i a
S p r i n g f i e l d , Ohio
S t a t e of Michigan
D e t r o i t , Michigan
Caddo P a r i s h , Louisiana




G.O.
G.O.

.

J anuary
January
January
January
January
January

16
17
17
17
17
18

H.lU

F-2
Forthcoming Large O f f e r i n g s , as of January 13 (Cont'd)
Issuer

Type

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

STATE Aim LOCAL GOVERNMENT (Cont'd)
Louisiana S t a t e Building Authority
•^Milwaukee County, Wisconsin
P h i l a d e l p h i a , Pennsylvania
S t a t e of Maryland
Tacoma, "Washington
*Wal sen burg, Colorado
Oklahoma City, Oklahoma
•aPublic Housing A u t h o r i t i e s
Rochester, New York
Florida S t a t e Turnpike Authority
Inter-American Center Auth., F l a .
Oklahoma Turnpike Authority
Pennsylvania Turnpike Commission
Washington S t a t e Toll Bridge Auth.
S a l t River P r o j e c t , Arizona
Connecticut Expressway

L.L.
G.O.
G.O.
Rev.

Rev.
Rev.
Rev.
Rev.
Rev.

7.6
8.9
6.0
7.8
5.0
21.0
13.2
106.8
7-U
185.0
25.0
65.0
62.0
227.0
11.0
100.0

January 19
January 23
January 25
January 31
January 31
February 2
February 7
February 7
February 21
Late spring
1956
1956
' 1956
. 1956
1956
1956

OTHER
None
*—Included i n t a b l e f o r f i r s t
1 / Includes corporate and other i s s u e s of $15 m i l l i o n and over; 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 .