Full text of H.16 Capital Market Developments : March 28, 1957

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Not for Publication DECONTROLLED AFTER SIX MONTHS
H.Ik

"

: March 28, 1957
CAPITAL MARKET DEVELOPMENTS

The volume of public security financing continues to be substantial. During the.week ending March 22, corporations sold large
issues totaling £>118 million, including expiration of subscription
rights, and State and local government offerings amounted to $71
million. The calendar for this week includes corporate issues
totaling §286 million, comprised of tlie $250 million AT&T debenture
issue and expiration of rights, for two stock issues. State and local
government offerings for i$56 million are also scheduled for sale.
Bond yields - Changes. in bond yields were mixed, but minor
last week. Yields on corporate Aaa and U. -S. Government (new series)
obligations increased, while those for State and local government Aaa
bonds remained stable. Yields on Baa corporate and State and local
government bonds, and U. S. Government (old series) obligations declined.

Amount
(millions of
dollars)

11

July 11, 1956
March 27, 1957

Maturity

Coupon
rate

II

The AT&T issue this week was reoffered to yield 1*.30 percent, 57 basis points above that for a comparable offering made by
this company in July of last year. . Yields on similar outstanding
bonds have increased h3 basis points over this 8-month period.

t ®

Yield
New
issue Outstanding 1/
3.73
W o

3.36
3.79

1/ As measured by Moody's Aa-rated, public utility bond average.
Stock prices - Stock prices, as measured by the SEC index
of. 265 common stocks, declined slightly last week, closing at 265,1
on March 22, Daily figures through Wednesday of this week indicate
little change in prices,
<'
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,
Bdard of Governors of the Federal Reserve System,




EXHIBIT A

HIGH-GRADE

BOND YIELDS

long-term 2/
Corporate
Aaa 1/

Old series

New series

Spread between
State and
U. S. Govt,
local govt. (old series) and
Corporate!State and
Aaa J /
Aaa
Jlocal Aaa

(Per cent)
1953 - High
Low
1951 - High
Low
1955 - High
Low
1956 - High
1957 - High
Low
February 22
March 8
March 15
March 22

n.a.
3.1*2 (6/19) 3.15 (6/6)
2.99 (1/9) 2.78 (12/26)
3.09 (1/8) 2.7U ( V P )
2.85 (U/23) 2.1*1* (8/7)
3.17 (12/23) 2.9k (8/5)
3.03 (8/5)
2.91 (1/7) 2.62 (1/7) 2.89 (6/10)
3.79 (12/28) 3.1*9 (12/21) 3.39 (12/28)
3.07 (3/2) 2.80 (2/17) 2.92 (2/3)
3.82 (1/1*) 3.53 (1/1*) 3.1*5 (1/1*)
3.22.(2/8)
3.66 (3/15) 3.15 (2/8)

2.73
1.98
2.21
1.90
2.3b
2.05
3.05
2.17
3.05
2.76

3.66
3.66
3.66
3.66
3.67

2.76
2.83
2.90
2.88
2.88

3.21*
3.27
3.30
3.25
3-21*

3.29
3.28
3.26
3.26
3.28

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

.38
.19
•h3
.32
.31*
.13
.1*1*
.13
.51*
.29
.1*2
.39
.36
.1*1
.1*3

•

.81*
.30
.61
.29
.70
.51*
.68
.32
.1*8 .
.26
.1*8
.1*1*
.1*0
.37
.36

1/ Weekly average of daily figures. Average time of bends includes 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 lit 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/i* per cent bond of 1978-83.
^/Thursday figures. Only general obligation bonds are includedj average
term is 20 years.
Note.—Highs ana lows are for individual series ana may be on different dates
for different series.




FXHIBIT B

LOWER - GRADE BOND YIELDS

Corporate
Baa y

State and
local govt.
Baa 2/

State and
local govt,
rev. j/

(Per cent)
1953 - High

3.89 (9/18)

3.79 (6/25)

195U - High
Low
1955 - High

3.7U (1/8)
3.Ui (12/31)
3.63 (12/30)

3.32 (1/7)
2.93 (8/5)
3.26 (12/29)

a.a (12/28)
3.58 (3/9)

it.22 (12/27)
3.20 (3/8)

1956 - High

3.50 (1/2)

3-1*5 (1/lW

1957 - High

k.so (1/18)
k.h2 (3/22)

February 22
March 1
March 8
March 15 March 22

h.kS

k.U6

h.hl

h.h3

U.h2

2.96 (1/8)

3.02 (1/6)

k.22 (1/10)

3.90 (2/21)
3.90
3.99
,3.99
3.99
3.97

3.27 (6/26)

2.71 (1/2)
3.00 (1/1)

2.72
2.99
2.76
3.98
2.89
3.98
3.70

(8/13)
(12/30)
(1/7)
(12/28)
(2/2U
(1/U)
(2/22)

3.70

1:11
v

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.
h/ Series discontinued.
Note.—Highs and lows are for individual series and may
be on different dates for different series.




STOCK MARKET

t t

Stock price

Trading
Common
Stock market customer credit
Customers
volume 2/
(millions yields j/ Total debit bal- loans to
of shares) (per cent)
ances 1*/ "others" 5/
(Millions of dollars)

167.1 (1/2)
Udt.O (9/18)
221.li (12/31)
156.5 (1/6)
270.7 (12/30)
217.lt (1/11*)
295.5 (8/3)
257.h (1/20)
279.2 (1/1*)
260.3 (2/8)

2.5
0.9
3.7
1.1*
1*.6
1.5
3.1
1.5
2.7
1.6

5.88
5.15
5.1*9
1*.05
li.23
3.59
1*.13
3.65
1*. 28
3.91

2,1*1*5
2,055
3,1*36
2,1*05
2*,030
3,537
MU7
3,911*
3,903
3,81*6

1,665
1,312*
2,388
1,653
2,805
2,517
2,823
2,71*0
2,762
2,729

780
661*
1,01*8
71*6
1,21*1
1,018
1,267
1,155
1,163
1,117

273.0
262.li
265.1
265.7
265.1

2.2
2.0
1.8
1.7
1.6

1*. 13 . 3,903
.3,81*6
{*•27
U.19
1*.18
1*.18 .

2,762
2,729

1,11*1
1,117
1,120
1,126

:
n.a.—Not available
1/ SEC index of 265 common stocks, weekly closing prices, 1939*100j converted
to 191*7-1*9-100 by Federal Reserve. The conversion factor is 123.91.
2/ Averages of daily trading volume on the New York Stock Exchange.
3/ Moody's 125 industrial stocks; weekly data based on Friday.
y End of month figures for member firms of the New York Stock Exchange which
carry margin accountsj excludes balances secured by U. S. Government obligations. £/ 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

H.lU

Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)
New capital

State and local
L . 1^6. ,L

Corporate
1957

,January
j February
March

1

1956

e/1,039
e/1,050

579
* 70U
790

e/1,275

816

April
May
June

l,lLk
830
1,066

Augj:;t
September

"

October
November
December
^lst
2nd
3rd
Uth

quarter
quarter
quarter
quarter

669
836

1,0882/
1,09U

e/3,36U

2,073

2,789
2,571

2,929

1st half
Three quarters
Year

|

1955

1955

1957

535

e/660

UoU

e^525
e/ 5oo

390 •

538

378

U27
350

U07
1,223
U78

886 _
687

U90
735
376
199
333

597
6UU

670

1,1621/

6U5
311
U26

632
900
2,165
2,052

e/lf85

1,911
2,695

U,862

U,216

7,U32
10,362

6,127

696

1,U90

1,60S
908
1,382
3,093

U,ooi

8,821

5,383

535
312

6U2 '
U70

249

Uo6
919

658
U08
1,385
1,U18
1,12U
1,98U
2,803

3,927
5,911

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

quarter
quarter
quarter
quarter

e/3,l6U

Year

1,617
2,519
2,263
2,83U ;

9,233

1,727
- 1,870

c/l,UUU
2,55U

c/7,595

z-

c/ Corrected,
e/ Estimated,
1/ Includes ^637,2 million AT&T convertible debenture issue.
2/ Includes &571.5 million AT&T common stock issue.
3/ Total new capital issues excluding offerings of sales and consumer finance
companies.
Note.—Details may not add to totals due to rounding.




H.lU

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

Month

State and
local government
. 1M
163
157

212
278
3#
#3
- 165
#2 217
#8
#6 .
701
U30
567
671

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

Other 2/

h6 3
16U
35
18k
383
135
201
386
306

50
20
37
35
100
5o

Large Individual Issues Offered March 1 through 22
Issuer

Type 3/

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

O0RPOBATE
Commercial Credit Co,
Sub. notes
25.0
Anaconda Co.
Common stk.
86.7
Columbus & So. Ohio Elec. 1st mtg. bds.
16,0
Connecticut Lt. & Pwr. Co. Common stk,. - 15.3
Texas Eastern Trans, Corp. 1st mtgtP.L. bds.UO.O
Southern Counties Gas Co. 1st mtg. bds. 15.0
Commonwealth Edison Co.
1st mtg. bds, 50.0
Central & South West Co, Common stk.
21.5
Owens-Corning Fiberglas
Corporation.
Common stk.
16,3
American Natural Gas Co. Common stk»
2k.1
Dresser Industries, Inc. Conv.Sub,Deb.
20.0
Consolidated Edison Co.
Conv. Deb,
5U.6




1977

h 1/2

L65

1987

k 1/2

it.ia

1977
1982
1987

L 7/8
k 5/8
hl/h

U.91
U.53
1.25

Baa
,, A
Aaa

1977
1972

kl/8
h 1/2

U.13
h.50

Baa
A

A

I

H.Ik

E-2

Large Individual Issues Offered March 1 through 22 (Cont'd)

Issuer

Type y

tioupon
Amount
rate or Offering
(millions
Maturity
Rating
net inter- yield
of
est cost
dollars)

CORPORATE (Cont'd)
Cum.pfd.stk.
El Paso Natural Gas Co.
Appalachian Elec. Pwr, Co. 1st mtg.bds.
Public Service Elec. &
Deb.
Gas Company
Common stk.
Consumers Power Co.

15.0
29.0
50.0
23.5

1987

h 5/8

i*.55

A

1977

h 5/8

U.52

A

STATE AND LOCAL GOVERNMENT
Houston Ind. Sch. Dist,,
G.O.
Texas
G.O.
Seattle, Washington
G.O,
State of Rhode Island
G.O,
Ferndale Sch. Dist,, Mich.
Wtr.rev,
Chicago, Illinois
G.O,
Memphis, Tennessee
^Broward Co, Spec. Tax
G.O,
School Dist,, Florida
Alabama Highway Authority
L.L.
G.O.
Commonwealth of Mass,
Dade Co, Tax Dist. No, 1,
G.O,
Florida
Elec. rev.
Glendale, California
Louisiana St. Bldg. Auth.
L.L.
State of South Carolina
. G.O.

i.oi*
3.66
3.03

2.35-3.50
2.35-3.25
2,00-3.25
2.60-1.00
3.1*0-3.60
2,00-3.10

A
A
A
Baa
A
Aa

6,0 1959-76
1U,0 1958-76
20,2 1958-77

3.60
3.63
3.03

2,70-3.60
2.U0-3.65
2.00-3.05

A
A
Aa

10,0
6.5
9.9
10.0

3.62
2.70-3.65
3.06 - 2.20-3.05
3.80
3.20-3.75
2.00-2,85
2.83

16.8
6.5
13.0
5.5
15.0
11.5

1958-87
1959-77
1958-85
1958-83
1970-77
1958-87

1959-76
1958-77
1962-71
1958-77

3.50
3,21
3.19

A
Aa
Baa
Aa

OTHER
None
1/ Includes corporateand other security offerings of §15 million and overj
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.

e



Exhibit F

'Mi.

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

Date of
computation
1956 - Feb. 29
Mar. 30
Apr. 30
May 31
June 29
July. 31
^
Aug. 31
Sept. 28
Oct. 31
Nov. 30
Dec. 31
1957 - Jan. 31
Feb. 38

123
380
568
198
137 "
2k7
369
315
683
436
hl6
591
7U0

220
132
173
332
81
131
359
162
1*8
280
153
153

37

23
100
35

233
1,013
818
Wi8
567
1,096
1,202
1,009
990
U81
796
966
795

785
811
832
9ltl
690
726
958
1,197
955
979
763
6k8
631

37

23
100
35

Forthcoming Large Offerings, as of March 22
Issuer

Type

Amount
Approximate date
(millions
I of dollars) of offering

CORPORATE
Lone Star Gas Co.
American Tel. & Tel. Co.
General Public Utilities Corp.
El Paso Natural Gas Co.

Conv.pfd.stk.

15,5

Deb.
Common stk.

250.0
20.7

Conv,2nd pfd.stk.

30.0

Baltimore Gas & Electric Co.

Common stk.

17.9

Babcock & Wilcox Co.

Capital stk,

20.0

Southern Company

.Common stk.

30.1

S.F. deb.
Common stk.

125,0
26.3

Common stk.

17.7

^Aluminum Co. of Canada, Ltd.
Houston Lighting & Power Co.
U. S. Foil Co,




March 25
(rights expire)
March 27
March 29
(rights expire)
April 2
(rights expire)
April 3
(rights expire)
April 3
(rights expire)
April h
(rights expire)
April 11
April 15
(rights ejpire)
April 16
(rights expire)

H.lU

F-2
Forthcoming Large Offerings, as of March 22 (Cont'd)
Issuer

Type

Amount
Approximate date
(millions
of dollars) of offering

CORPORATE (Cont'd)
Reynolds Metals Co.
Quebec Natural Gas Corp.
Quebec Natural Gas Corp.
Columbia Gas System, Inc.
Michigan Wisconsin Pipe Line Co,

Common stk.

17.3

1st mtg. bds.
Sub,deb.& coirmon
Common stk.

25.0
15*0
25.0

1st mtg; bds.

25.0

- April 16
(rights ejgpire)
April 16
April 16
April 22
(rights expire)
1957

STATE AND LOCAL GOVERNMENT
Palm Beach Sch. Dist. No, 1,Florida
Commonwealth of Puerto Rico
State of Ohio
Melbourne, Florida
Jefferson Co., Texas
Los Angeles City Sch. Dists,, Calif
Harris Co. Navigation Dist,, Texas
#Miami, Florida
^-Lynchburg, Virginia
ttOhio State University
estate of Michigan
Jacksonville Expressway Authority
Public Housing Authorities
Milwaukee, Wisconsin
Orleans Par. Sch. Dist,, La,
^Philadelphia, Pennsylvania
State of California
State of Connecticut
^Jacksonville, Florida
Pennsylvania^Turnpike Commission
Inter-American Center Auth.,Florida
New York State Thruwav Authority
Florida State Turnpike Authority
Oklahoma Turnpike Authority

G.O,
G.O,
Thoroughfare rev,
Wtr. & swr, rev.
G.O.
|
G.O.
.
G.O,
G.O.
Wtr. & swr, rev
Dormitory rev.
Expressway rev,
Rev.
G.O, o
G.O.
G.O,
G.O.
Expressway rev.
Rev.
Rev.
Rev,
G.O.
Rev.
Rev.

6.9
10.0
32,0
6.8"
$.k
20,0
7.0
: 7.5
5.0
6,0
25.0
W.5
36.1
22,2
5.0
29.5
75.0
50,0
30.0
62.0
20.0
50.0
185.0
65.0

March 25
March 26
March 27
March 27
April 1
April 2
April 3
April 3
April 8
April 8
April 9
April 9
April 10
April 16
April 17
April 17
April 2h
April ,
May 9
1957
1957
1957
1957
1957

OTHER
High Authority, of the European
' Coal and Steef Community
"Bonds
25.0
April 10
*—Included in table for first me.
1/ Includes corporate and other issues of $15 million and overj 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 th#n sale of issu&: None,




H,lU

'

Exhibit G
Yields on New and Outstanding
Electric Power Bonds, Rated Aa and A

Date
1952 - 1956
High
Low
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

Aa-rated offering yields A-rated offering yields
Amount above .
Amount above
Actual
Actual
seasoned yields
seasoned yields
(per cent) (basis points) (per cent) (basis points)
U.30(12/12/56)
2.93(3/31/54)
None
*3.15 ;
3.28
*3.77
*3*53
*3.52
3.66
*4.07
1.13

62
- 3
3
11 •
. 4o
19
18
29
52
53

4.20
4.30

48
52

4.30

47

4.50

62

4.43

56

4.40
4.29
4.25
4.22

53
. 45
46
43

4.58(12/6/!;6)
3.00(3/17/54)
None
3.23
3.45
3.61
3.76
*3,75
*3.82
*4.00
None
4.40
4.58

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

4.67

70

4.56

57

4.41
4.58
4.55

35
52
49

*—Single observation, not an average,
1/ 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. . Average maturity for the seasoned issues
varies from 26 to 28 years.