Full text of H.16 Capital Market Developments : March 16, 1955

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Not f o r P u b l i c a t i o n

/
DECONTROLLED AFTER SIX MONTHS

Htlii

.

March 16, 1955

CAPITAL MARKET DEVELOPMENTS
Volume of s e c u r i t y o f f e r i n g s l a r g e l a s t week - The General
Motors Corporation 328,6 m i l l i o n d o l l a r stock o f f e r i n g , the s u b s c r i p t i o n r i g h t s f o r which ended March 7, and s e v e r a l S t a t e and l o c a l government s e c u r i t y i s s u e s t o t a l i n g 76 m i l l i o n dollars^were t h e l a r g e
p u b l i c i s s u e s o f f e r e d f o r new c a p i t a l during the week ending March 11.
Large S t a t e and l o c a l i s s u e s with aggregate proceeds of i±6 m i l l i o n
d o l l a r s a r e scheduled f o r o f f e r i n g t h i s week; no l a r g e corporate
issues are l i s t e d .
The s t a t u s of a number of very l a r g e t o l l road bond o f f e r ings i s s t i l l i n d e f i n i t e . On the b a s i s of c u r r e n t i n f o r m a t i o n , ' i t
appears t h a t none of t h e s e i s s u e s w i l l be marketed i n t h e near f u t u r e .
Bond y i e l d s - Yields on outstanding corporate Aaa and Baa
bonds increased s l i g h t l y , and high-grade municipal bond y i e l d s d e creased s l i g h t l y during the week ending March 11. Treasury o b l i g a t i o n y i e l d s d e c l i n e d t h r e e b a s i s p o i n t s t o 2.72 per cent l a s t week,
and f e l l sharply t o 2.66 on Tuesday.
Further i n c r e a s e in customers 1 d e b i t balances - Customers 1
d e b i t balances, excluding borrowings f o r carrying U. 5. Government
s e c u r i t i e s , of member firms of t h e New York Stock Exchange, increased
73 m i l l i o n d o l l a r s during February t o t o t a l 2,590 m i l l i o n a t the end
of t h e month. Customers' d e b i t balances f o r c a r r y i n g U. S. Government s e c u r i t i e s increased 21 m i l l i o n d o l l a r s .
The borrowing of NYSE f i r m s c a r r y i n g margin accounts, on
U. S . Government s e c u r i t i e s , r o s e during February., although the t o t a l
of such borrowings a t New York and Chicago weekly r e p o r t i n g member
banks declined s u b s t a n t i a l l y .




H.lii

—2—

The following a r e January and February 1955 f i g u r e s f o r
stock market c r e d i t outstanding:
(Millions of d o l l a r s )
January

February

Customers' debit balances - t o t a l

2,#8

2,653

Customers' d e b i t balances - excluding
money borrowed f o r carrying Government o b l i g a t i o n s

2,517

2,590

Money borrowed by member f i r m s maint a i n i n g margin accounts

1,696

1,779

Money borrowed, by member f i r m s
maintaining margin accounts, on
c o l l a t e r a l other than Government
obligations

1,620

1,666

Customers' f r e e c r e d i t balances

1,069

1,063

Bank loans t o others f o r purchasing
and c a r r y i n g s e c u r i t i e s ( l a s t
Wednesday of month-weekly r e p o r t i n g member banks, excluding Governments for New York and Chicago
r e p o r t i n g banks

1,020

1,053

Stock p r i c e s , as measured by the SEC index of 265 common
s t o c k s , dropped 10.2 p o i n t s t o 220*8 l a s t week. This was 3,k points
above the January low. Daily indexes i n d i c a t e t h a t another sharp
decline occurred on Monday of t h i s week. Most of t h e l o s s was r e covered on Tuesday, however. Trading volume on the NYSE, which
averaged 3.2 m i l l i o n shares a day l a s t week, was Zw2 m i l l i o n on
Monday.




-3Further d e t a i l s on c a p i t a l market developments a v a i l a b l e
from e x h i b i t 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 w i l l be found in the following e x h i b i t s which
are attached hereto:
A - Bond Yields
B - Stock Market
C - Corporate and S t a t e and Local
Government S e c u r i t y Offerings
and Placements
D - Large Public Security I s s u e s
f o r New C a p i t a l (Other than
U. S. Treasury)
E - Forthcoming Large Public Security
Offerings f o r New C a p i t a l (Other
than U. S. Treasury) '
F - Yields on Mew and Outstanding
E l e c t r i c Power Bonds, Rated Aa and A

Business Finance and C a p i t a l 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. 14

EXHIBIT

A

BOND YIELDS
WEEKLY

PER

CORPORATE

PER

ANNUM

Baa

CORPORATE

U.S.

CENT

Aaa

GOVERNMENT
LONG-TERM

/HIGH-GRADE

MUNICIPAL

1951

1952

1954

1953

Corporate 1/

u. S. Govt.

Spread between

'55

High-

V ZiTT C .

i—bss~

(Per cent per amum)
1952 - High
Low
1953 - Hitfi
Low
1951* - High
1955 - High
Low
February 11
February 18
February 25

3.03
2.91
3.12
2.99
3.09
2.85
3.0k
2.91
2.97
2.99
3.02
3.03
3.Oil

3.63
3.1*8
3.89
3.50
3.7U
3.1*1*
3.1*9
3.1*5
3.1*7
3.1*7
3.1*8
3.1*8
3.1*9

2.79
2.56
3.15
2.71*
2.71*
2.1*1*
2.77
2.62
2.69
2.72
2.77
2.75
2.72

.37
.19
•38
.19
.1*3
.32
. .32
.25
.28
.27
.25
.28
.32

2.1*3
2.00
3.H*
2.1*3
2.56
2.23
2.1*6
2.36
2.1*1
2.1*1
2.1*3
2.16
2.1*5

V Moody's Investors Service; weekly average of dally" f i g u r e s .
2/ Federal Reserve; weekly average of daily f i g u r e s .
i f Standard and Poor's Corporation; Wednesday f i g u r e .
Note.--Highs and lews are for 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 s e r i e s .




STOCK MARKET

• AiHioi L9?Jh-

—L VOLUME

1953 '

1952 '

Date

mm

Bank loans
Trading
Common stock Customers' t o "others"
Stock p r i c e volume 2 /
f o r purchases
y i e l d s 3/
Index y
of securbalances 4 /
(per cent
(millions
(1947-49-100) of shares) per annum)
(millions
i t i e s 5/
of d o l l a r s ) (millions
of d o l l a r s )

1952 - High
Low
1953 - High
Low
195k - High
Low
1955 - High
Low
January
February
February 25

165.3
151.7
167.1
144.0
221.4
156.5
231.0
217.4
218.4
226.8
226.2
231.0
220.8

2.0
0.9
2.5
0.9
3.7
1.4
4.6
2.8
3.6
3.2
2.9
3.0
3.2

-

5.77
5.13
5.75
5.15
5.33
4.20
4.22
4.21
4.22
4.21

.

1,328
1,241
1,665
1,314
2,388
1,653
2,590
2,517
2,517
2,590

295
250
327
252
487
- 328
499
475
481
490
497
493
499

1/ SEC index of 65 common stoc
closing of-ice . 1919-100: converted t o
1947-&-100 by Federal Reserve. The conversion f a c t o r i s 123.91.
2 / Weekly averages of d a i l y trading volume oil New York Stock Exchange.
3 / Moody's 200 common s t o c k s j end of month f i g u r e s .
4 / End of month f i g u r e s f o r member firms of New York Stock Exchangej excludes
balances secured by U. S. Government s e c u r i t i e s .
—
5 / Wednesday f i g u r e s f o r weekly reporting member banks in New York and Chicago;
excludes loans f o r purchase of D. S. Government s e c u r i t i e s . On March 4, 1953, the
l a s t date on which f i g u r e s f o r a l l reporting banks were a v a i l a b l e , New York and
Chicago accounted f o r 45 per cent of such loans. In the past New York and Chicago
loans have f l u c t u a t e d more than t o t a l loans.
ij.a.—Not a v a i l a b l e .
Note.—Higia and lews are f o r individual s e r i e s and may be on d i f f e r e n t dates
for different series.




Exhibit C
Corporate and. S t a t e and Local Government
Security 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 )
i
1955
JanuaryFebruary
March

?

"
Corporate
1
1954
1

1953

1955

544
43 9
660

623
623
666

e/535
^310
e/500

I486
6#
#9

779
675
1,123

e/hB6
e/350
e/%225

April
May
June

-

July
August
September

-898
346
776

October
November
December
1st quarter
2nd q u a r t e r
3rd q u a r t e r
iith q u a r t e r
Year

e/2,06l

1st quarter
2nd q u a r t e r
3rd q u a r t e r
iith q u a r t e r
Year

e/l,66l

•

New-capital

S t a t e and l o c a l
1 1951
1

x

565

389
360
h26

. 734
743
853

329
, 6ii9
U3h.

183
325
753

1,008
298
592.

577
h29i/
l,h3&

1,61*3
1,998
2,021
1,899
7,#1

1,912
2,578

e/l,3i;5

is?
8,1#

1953

279
261
61*9

519
259
475

591
423
877

1:53
408
774

1,372
2,33k
1,188

1,176
1,102
1,253
1,636
5,477

a

'

Excluding f i n a n c e companies 2 /
1,562
1,931
1,91*1
1,795
7,229

1,669
1,991
1,223
2,344
7,227

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.
e / Estimated.
Note.—Details may not add t o t o t a l s due t o rounding•




H.llt

Exhibit D
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) 3 /
Proceeds of Large I s s u e s Offered
(Millions- of d o l l a r s )

Month

Corporate

1954 - February
March
April
May
June
July
August
. September
October
November
December
1 % - January
February

• S t a t e and
l o c a l government

103.
160
169
324
350
3#
75
335
413
0
94.
12*1
72

213
378
557
557
603
92
86
455
388
268
689
341
101

Other 2 /

50 .

30
35

Large I n d i v i d u a l I s s u e s Offered March 1 through 11

Issuer

Type 3 /

Coupon
Amount
r a t e or
Offering
(millions
Maturity n e t i n t e r Rating
yield
of
e s t cost
dollars)

CORPORATE
May Department S t o r e
SF deb.
25.0
Central & South West Corp, Common s t k .
20.1
Union Oil Company
Conv. deb.
21.0
P a c i f i c Gas & E l e c t r i c Co. l s t & r e f mtgbds 50.0
General Motors Acceptance Corp.
Deb.
250.0
General Motors Corp.
Common s t k . 328.6

1980

3 iA

3.25

A

1975
1987

3
33/8

3.00
3.30

Baa
Aa

1960;1972

353 1/2

3.0053.50

STATE AND LOCAL GOVERNMENT
P o r t l a n d , Oregon
S t a t e of Louisiana
Hempstead & N. Hempstead,
New York
Houston, Texas




G.O.
G.O.

8.0
10.0

1958-75
1960-70

2.01
2.23

1.15-2.20
1.50-2.35

Aa
A

G.O.
G.O.

15.5
15.0

1955-84
1956-85

3.08
2.59

1.10-3.13
1.00-3 a o

Baa
A

.

H.lh

D-2

Large I n d i v i d u a l Issues Offered March 1 through 11 (Cont'd)
Issuer

Type

Amount
Coupon
p i l l i o n s Maturity r a t e or
Offering Rating
of
net i n t e r yield
dollars)
est cost
'

STATE AND LOCAL GOVERNMENT
(Cont'd)
Multnomah County, Oregon
Metropolitan Water D i s t r i c t of Southern Cal.
ICS.T York Bridge Authority
S t a t e of South Carolina
S t , Petersburg, F l o r i d a
Oyster Bay, New York

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

12.0^

1956-75

2.02

a.o
16.0
20.0
llwO
5.8

1956-80
1956-89
1956-75
1956-77
1955-83

2.19
2.6k
1.95
3.50
2.97

0.95-2.20

Aa

0.95-2.35
1.00-2.69
0.95-2.10
1.75-3.43
1.00-3.05

Aa
A
Aa
Ba
Baa

OTHER
None .
over;~State 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 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 .
3 / In the case of State 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 o b l i g a t i o n s 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; and, 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 by pledge of
designated revenues.
V 3«5 m i l l i o n d o l l a r s not r e o f f e r e d pending s e t t l e m e n t of t a x p a y e r s ' l i t i gation.




Exhibit E

H.llt

Forthcoming Large Public Security. Offerings f o r New Capital
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues
During month following
date shovm
S t a t e and
Corporate l o c a l govt. Other 2 /

Bate of
computation
195k - Feb. 26
Mar. 31
Apr. 30
- May 2 8
June 30
July 30
Aug. 31
Sept. 30
Oct. 29
Nov. 30
Dec. 31 .
1 % - J a n . 31
Feb. 28

108
20h
323
332
336
100
33k
3k3
$

18k
16
710

1*98

50

i

27

596
86
5k
300
383
136
661
#7
682
52k

30

Subsequent t o
date shovm
Corporate
690
555
6k7
526
532
303
6o8
klk
135
21*6
216
1*22
1,395

ipeal^ort. | o t h e r
1,916
2,789
2,322
1,971
1,52k
1,553

50
27

1,876

2,158
1,957

30
30
35

2,682

2,lUli
1,961
1,978

Forthcoming Large Offerings, as of March 11
Issuer

Type

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

CORPORATE
Joy Manufacturing Company
SF deb.
^ P a c i f i c Northwest Pipeline
Interim notes
New England Telephone and Telegraph
Common stock
^•National Gypsum
Common stock
•^General Dynamics Corp.
Conv. deb.
^Tennessee Gas Transmission
Deb.
^•Philadelphia E l e c t r i c
Bds .
Alabama Power
1st mtg. bonds
American Telephone and Telegraph
Conv. deb.

20.0
17.2
15.7
19.0
kO.O
25.0
20.0
15.0
650.0

March 22
March 29
March 31
April k
April 5
April 12
April 25
May 2 It
• 1955

STATE AND LOCAL GOVERNMENT
S t a t e of Mississippi
S t a t e of New Jersey
New Jersey Turnpike Authority
*New York S t a t e
Georgia S t a t e School Building Auth.




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

.

5.2
6.6
3k.O
50.7
30.2

March
March
March
March
March

15
15
17
22
22

H.Iii

E-2
Forthcoming - Large O f f e r i n g s , as of March 11 (Cont'd)
Type

Issuer

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

'

STATE AND LOCAL GOVERNMENT (Cont'd)
^Florida S t a t e Improvement Comm.
e s t a t e of Massachusetts
San Francisco, C a l i f o r n i a
Los Angeles, C a l i f o r n i a
L o u i s v i l l e , Kentucky
tfCalcasieu P a r i s h , Louisiana
Wichita, Kansas
San Diego County, C a l i f o r n i a
Inter-American Center Auth., F l a .
Michigan Turnpike Authority
S t a t e of Louisiana
F l o r i d a S t a t e Turnpike Authority
I l l i n o i s Turnpike Authority
Connecticut Expressway
Texas Turnpike A u t h o r i t y
Sam Houston Turnpike Corp.
Texas Turnpike Company
Dade County Port A u t h o r i t y , F l a . '
Springfield, Illinois
Allegheny County, Pennsylvania
S a n i t a r y Authority
C a l i f o r n i a Toll Bridge Authority
J e r s e y City Sewerage A u t h . , U. J .
North Carolina Turnpike Authority

Rev.
n.a.
n.a.
n.a.
n.a. •
n.a.
n.a.
. Rev.
Rev.
n.a.
' Rev.
Rev.
Rev.
Rev.
Rev.
Rev.
Rev.
Rev.
. Rev.
Rev.
n.a.

6.0
60.0
6.9
5-10.0
7.5
5.5
7.U
8.U
60.0
186.0
80.0
71.0
• 390.0
100.0
58.5
31*6.0
11*0.0
21.0
9.0
85.0
235.0
16.0
200.0

March 31
March
A p r i l I4.
April 6
April 20
A p r i l 21
A p r i l 26
Spring y
Spring
Spring
Spring
Spring
1955
1955
1955
1955
1955
1955
1955
1955
1955
1955
1955

OTHER
None

J

1/ Includes corporate and other i s s u e s of 15 m i l l i o n d o l l a r s 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 o v e r .
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 .
n.a.—Not a v a i l a b l e .
•a—Included i n t a b l e f o r f i r s t time#




Exhibit F
Yields on New and Outstanding
E l e c t r i c Power Bonds, Rated Aa and A 1 /
Date

1952 average

Aa-rated o f f e r i n g y i e l d s
A-rated o f f e r i n g y i e l d s
Amount above
Amount above
Actual
Actual
(per c e n t ) seasoned y i e l d s (per cent) seasoned y i e l d s
(basis points)
(basis points)
3.16

13

1953 average

3.43

15

195U average

3.04

3

195k - January
February
March
April
May
June
July
August
September
October
November
December

3.20
3.02
*2.93
2.99
3.00
*3.00
None
None
3.02
3.03
None
None

6
0
0
5
h
1

1955 - January 19

3.15

13

February 2k
25

3.14

7

March 10

3.17

8

*

3
3
—

'

3.35

12

3.79

27

-

3.12

-3

*3.32
*3.20
3.05
3.10
3.14
3.14
*3.13
3.11
*3.10
\ 3.10
None
3.11

2
-1
-10
-6
0
-2
-1
-1
-3
-2

3.23

9

0

Survey. Except where i n d i c a t e d , the 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 are averages of o f f e r i n g s during t h e i n d i c a t e d period and of
t h e d i f f e r e n c e s between t h e s e 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 . t h e seasoned i s s u e s
v a r i e s from 26 t o 28 y e a r s . .
*
*—Single o b s e r v a t i o n , not an average.