Full text of H.16 Capital Market Developments : June 21, 1956

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Not for Publication DECONTROLLED AFTER SIX MONTHS
H.lU

June 21, 1956
CAPITAL MARKET DEVELOPMENTS

The volume of publicly offered securities was moderate
during the week ending June 15, but will be quite large this week.
State and local governments sold large bond issues totaling $91
million last week and an $18 million corporate preferred stock
-issue was floated. This week, ending June 22, State and local governments are expected to offer large issues totaling $20ii million,
including the $166 million Grant County Public Utility District
offering, and corporate issues amounting to $U3 million are scheduled for sale.
Bond yields - There were few changes in yields on outstanding bonds last week. Corporate Baa and U. S. Government (old
series) bond yields were stable, while yields on other major categories of bonds declined. Yields on newly offered corporate bonds
appear to have been stable. A 30-year, first mortgage, electric
utility bond issue was reoffered at 3.52 'per cent on June 8, about
the same yield as on a similar offering of late May.
Stock prices - Common stock prices, as measured by the
SEC index of 265 stocks, increased 7.2 points during the week ending June 15, closing at 277.0. At this level stock prices are still
5 per cent below the 1956 high, however. Daily data indicate little
change in prices through Wednesday of this week.

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




H I G H - G R A D E BOND YIELDS

CORPORATE Aqo

s. GOVERNMENT: J \ /

STATE AND LOCA1
GOVERNMENT Aaa |

U. S. Govt.. long-term t]
Corporate
Aaa 3/

Old series

New series

Spread between
U. S. Govt.
Stave and
local govt. (old series) and
Corporate(State and
Aaa J /
Aaa
Ilocal Aaa

(Per cent)
1953 - High
Low
1951 - High
Low
1955 - High
Low
1956 - High
Low

3.1*2
2.99
3.09
2.85
3.17
2.91
3.30
3.07

Hay 18
May 25

3.27
3.27
3.27
3.27
3.26

(6/19)
(1/9)
(1/8)
(ii/23)
(12/23)
(1/7)
(5A)
(3/2)

3.15
2.78
2.7k
2.1*1*
2.9U
2.62

n.a.
(6/6)
(12/26)
(1/9)
(8/7)
(8/5) 3.03 (8/5)
(1/7) 2.89 (6/10)
3.13 U/20)
2.92 (2/3)

2.73
1.98
2.21
1.90
2.3U
2.05
2.51
2.17

2.9U

3.03
3.00
2.99
2.98
2.97

2.a

2.89
2.87
2.87
2.87

2.bh
2.1*2
2.38
2.33

(6/25)
(1/8)
(6/10)
(9/2)
(9/8)
(5/26)
(5/3)
(2/23)

.38
.19
.1*3
•32
.31*
.13
.1*0
.13
•33
.38
.1*0
.1*0
.39

.81*

:S.29

1
.1*5

I
.50

~ l / Weekly average of daily figures. Average term of bonds included is 25-26
years.
The old series includes fully taxable,
a v e r a g e g o f daily figures.
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 lit years in early 1953 to
11 1 / 2 years in e a r l y 1956. The new series is comprised of the 3 per cent bond
of 1995 and the 3 l/k per cent bond of 1978-83.
j/ Thursday figures. Only general obligation bonds are included; average
t e m

Note.--Highs and lows are for individual series and may be on different dates
for different series.




EXHIBIT rB

L O W E R - G R A D E B O N D YIELDS
Weekly

Per cent per annum

CORPORATE B a a

STATE AND LOCAL GOVT. B a a
/I
I Moody', I
! /V

V"!

!

Z

STATE AND LOCAL GOVT. REVENUE

J

S

D

M

J

1953

1954

S

D
-

M

J

.

1955

"I
Date

Corporate•
Baa 1/

S

O

State and
local govt.
Baa y

M

J

S

D

1956

State and
local govt,
rev. 3/

(Per cent)
1953 - High
Low
1S5U - High
Low
1955 - High
Low
1956 - High
Low

3.89
3.50
3.7k
3.lUt
3.63
3.U5
3.75
3.58

May 18
May 25
June 1
June 8
June 15

3.73
3.73
3.7k
3.75
3.75

(9/18).
(1/2)
(1/8)
(12/31)
(12/30)
U M )
(6/15)
(3/9)

3.79
2.96
3.32
2.93
3.26
3.02
3.UU
3.20
3.37
3.33
3.31
3.28
3.23

(6/25)
(1/8)
(1/7)
(8/5)
(12/29)
(1/6)
(5/3)
(3/8)

3.27
2.71
3.00
2.72
2.99
2.76
3.12
2.89

(6/26)
(1/2)
(1/1)
(8/13)
(12/30)
(1/7)
(k/27)
(2/2U)

3.Oli
3.0U
3.03
3.02
3.00

1/ Weekly average of daily figures. Average term of bonds
included is 25-26 years.
2/ Thursday figures. Only general obligation bonds are
included; average term is 20 years.
2/ Friday figures. Average rating of bonds included is
between Baa and A; average term is 20 years.
Note.—Highs and lows are for individual series and may
be on different dates for different series.




STOCK M A R K E T

Stock price
index 1/

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

Stock market customer credit
Customers1
Bank
loans to
"others" jy
(Millions of dollars)

167.1
lWi.O
221.lt
156.5
270.7
217. k
290.8
257.a

(1/2)
(9/18)
(12/31)
(1/6)
(12/30)
(1/lli)
(lt/6)
(1/20)

286.8
280.1
272.9
269.8
277.0

2.5
0.9
3.7
l.U
U.6
1.5
3.1
1.7

5.75
5.15
5.33
it. 20
it.22
3.78
It.08
3.68

2,Wt5
2,055
3,U36
2,lt05
U,030
3,537
lt,0lt7
3,991

1,665
1,31U
2,388
1,653
2,805
2,517
2,810
2,7lt0

780
661t
l,0lt8
7lt6
l,2ltl
1,018
1,267
1,232

2.6
2.It
2.2
2.0
1.7

3.69
3.97

lt,0it3
lt,0lt7

2,788
2,810

1,255
1,237
1,237
1,232

n.a.

available.
1/ SEC index of 265 common stocks, weekly closing prices, 1939-100; converted
to 19U7-ii9-100 by Federal Reserve. The conversion factor, is 123.91.
2/ Averages of daily" trading volume on the New York Stock Exchange.
3/ Moody's 200 common stocks; end of month figures.
U/ 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)

1956
.January
February
March

1

Corporate
.'
1

New capital
1956

5k7
U26
635

kok
696
e/375

535
312
5#

396
111
565

e/350
e/500
e/700

U27
350
61*1

73k
7k8
853

kos

k70
2k9

279
261
6k9

919
6#
k08

59k
k23
877

1,385
l,kl8
1,12k
1,96k
5,911

1,372
2,33k
1,188
1,89k
6,789

579
70k
790

535
U07
1,223

e/890
e/1,100
e/875

i+78
886
687

k97 .
656
8k2

"July
August
September

597
6kk
670

909
335
7U7

October
November
December

1,162 y
632
900

1,003
290
60k

2,165
2,052
1,911
2,695
8,821

1,608
1,995
1,991
1,896
7,k90

April
May
June

1st quarter
• n d quarter
3rd quarter
Uth quarter
Year

2,073
e/2,865

State and local
1 1955
1 195k

195k

e/l,k75
e/1,550 '•

Excluding finance companies 2/
1st quarter
2nd quarter
3rd quarter
Uth quarter
Year

1,617
e/2,6'65

1,727
1,870
l,k3k
2,55k
7,569

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

1/ Includes $637.2 million AT&T convertible debenture issue.
£/ Total new. capital issues excluding offerings of sales and personal finance
companies.
,
Note.—Details may not add to totals due to rounding.




Exliibit E

H.14

Large Public Security Issues for New Capital
(Other than U. S. Treasury) 1/
Proceeds of Large Issues Offered
(Millions of dollars)
Corporate
1955 - MayJune
JulyAugust
September
October
November
December
1956 - JanuaryFebruary
March
April
May

State and
local government

Other 2/

152
1*03
278

183
175
101
it05 '
328
805

s
716

U01
227
192

221

263
95
212
278
395
623

I

khb

163
157
233

50

Large Individual Issues Offered June 1 through 15
Issuer.

Coupon
Amount
Offering Rating
Type 3/ • (millions Maturity rate or
net inter- yield
of
est cost
dollars)

- CORPORATE
Commonwealth Edison
U. S. Plywood
Household Finance
Boston Edison

1st mbg.bds.
Deb.
Deb.
Pfd. stk.

itO.O
15.0
50.0
18.0

1986
1981.
1978

Rev.
G.O.
G.O.
G.O.
G.O.
Elec. rev.
Util. tax rev.
Rev.

6.0 1956-96
8.5 1957-96
30.0 1957-71
5.3 1967-95
22,0 .1958-75
U.o 1959-78
1.5 1958-82
20.0 1958-82

3 1/2
h 1/h
k

U.25

3.50
iw25
U.00

Aaa
Baa
—

STATE & LOCAL GOVERNMENT
Wash. Toll Bridge Auth.
Cincinnati, Ohio
New York, N. Y.
Denver, Colorado
Chicago, Illinois
Tallahassee, Florida
Tallahassee, Florida
Pa. Gen. State Auth.




n.a.
2.35
2.80
2.50
2.61
3.13
3.07
2.66

y

1.70-2.50
2.00-2,80

2.10-2.55

2.10-2.65
2.60-3.15
2.25-3.10
2.10-2.70

. ' — *•

Aaa
A
Aa
A
Baa
A

H.lU

E-2

Large Individual Issues Offered June 1 through 15 (Cont'd)
Issuer -

Type 3/

Amount
1 Coupon
Offering Rating
(millions
M
* « j n e f L w yield
of
1 est cost
dollars)

STATE & LOCAL GOVERNMENT
(Cont'd)
Georgia Rural Roads Auth.
State of California
Hudson County, N. J.

Rev.
G.O.
G.O.

15.5
50.0
5.1

1958-72
1958-77
1958-81

2.81
2.30
2.7U

2.20-2,75
1.80-2.35
2.00-2.75

OTHER
None
State and local government security offerings of $5 million and over.
2/ Includes foreign government and International Bank for Reconstruction
and Development issues.
3/ 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.
h/ Ho reoffering.




A
Aa
A

H.lit

Exhibit F

Forthcoming. Large Public Security Offerings for New Capital
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues
Date of
computation

Subsequent to
During month following
date shown
date shown
State-and
Other 2/ Corporate State and Other 2/
Corporate
local govt.
local govt.
160
67

1955 - May 31
June 30
July 29
Aug. 31
SeptJ 30
Oct. 31
Nov. 30
Dec. 30
1956 - Jan. 31
Feb. 29
Mar. 30
Apr. 30
May 31

b07

222
805
202
215
70
176
123
380
568
198

339
3a
100
184
8U3
330
205
121
327
220
132
173
332

wmmm
—*
mmwm
mmm,
mmmm

50
—

850
830
1,135
920
909
b!2

230
85
376
233
1,013
818
168

1,861
1,845
2,018
1,971
2,205
1,650
756
6l8
917
785
811
832
9hl

~
—
—

-

— -

i— .
50
••
--

•
•

——

-

Forthcoming Large Offerings, as of June 15
Type

Amount
Approximate date
(millions
of offering
of dollars)

CORPORATE
Combustion Engineering
Halliburton Oil Well Cementing Co.
National Gypsum
Pacific Gas and Electric
^Florida Power Corp.
American Telephone and Telegraph
^Consolidated Natural Gas
CIT Financial
Pacific Finance

Conv. sub. deb.
.Common stk.
Common stk.
Common stk.
1st mtg. bds.
Deb.
Deb.
Deb.
Deb.

15.0
27.6
19.6
36.6
20.0
250.0
30.0
75.0
25.0

June 19
June 20
. June 25
(rights expire)
July 2
(rights expire)
July 2
July 10
Summer
1956
1956

STATE AND LOCAL GOVERNMENT
Alexandria, Louisiana '
Long Beach, California
.'Washington Suburban Sanitary
District, Maryland
' -State of Vermont
Power Authority of the State
of New York




Rev.
G.O.

8.3
5.9

June 19
June 19

G.O.
G.O.

8.5
7.6

June 21
June 21

Rev.

7.3

June 21

H.lU

F-2
Forthcoming Large Offerings, as of June 15 (Cont'd)
Issuer

Type

Amount
Approximate date
(millions
of offering
of dollars)

STATE AND LOCAL GOVERNMENT (Cont'd)
Grant County Public Utility
District, Washington
Public Housing Authorities
*State of Massachusetts
Florida State Turnpike Authority
Oklahoma Turnpike Authority
Pennsylvania Turnpike Commission
Washington State Toll Bridge Autli.
Inter-American Center Auth., Fla.

- G.O.
Rev.
Rev. •
Rev.
Rev.
Rev.

166.0
91.8
38.0
185.0
65.0
62.0
227.0
70.0

June 21
June 27
July 11
Summer
1956
1956
1956
1956

SF deb.

20.0

June 27

• Rev.

OTHER
British Columbia Power Commission

*—Included in table for first time.
n.a.—Not available.
1/ Includes corporate and other issues of $15 million and. over; State and
local -government issues of $5 million and over.
2/ Includes foreign government and International Bank for Reconstruction
and Development issues.




Exhibit G
Yields on Mew and Outstanding
Electric Power Bonds, Rated Aa and A 1/

Date

1952
1953
195U
1955

average
average
average
average

Aa-rnted offering yields A-rated offering yields
Amount above
Actual
Actual I Amount above
(per cent) seasoned yields (per cent) lseasoned yields
I(basis points)
(basis points)
3.16
3-U6
3.03
3.23

1956 - January
February
March 8
16
23
30
April h

Kone
*3. is
3.19

13
16
3
9

2k

June 8

22
26
-3
12

3.23

-5

—

—

3
5

3.37

18

3.77

ho

3.5:3
3.52

19
18

3.3S

h

11
25
May 9
lo

3.35
3.78
3.12
3.33

*

7

3»55
3-57
3.60
3-67

25
23
26
29

3.80
3.73

32
21 /

"

*—Single observation, not an average.
l/ Covers only 30-year first mortgage bonds, as reported in Moody's Bond
Survey. Except where indicated, the actual yield figure and the amount above
seasoned yields are averages of offerings during the indicated period and of
the differences between these new offering yields and yields on seasoned issues
of similar quality for the same day. The number of new issues included in the
monthly averages varies from 2 to b except for October 195U when 6 A-rated
issues were included. Average maturity for the seasoned issues varies from 26
to 28 years.

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