Full text of H.16 Capital Market Developments : October 27, 1955
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Not f o r P u b l i c a t i o n DECONTROLLED AFTER SIX MONTHS H.lU ' October 27, 1 9 # CAPITAL MARKET DEVELOPMENTS Corporations o f f e r e d 75 m i l l i o n d o l l a r s and S t a t e and l o c a l governments f l o a t e d 5>8 m i l l i o n d o l l a r s of l a r g e i s s u e s f a r new c a p i t a l during the week ending October 21. Large i s s u e s - e x pected t h i s week t o t a l m i l l i o n d o l l a r s f o r S t a t e and l o c a l governments, an amount which i n c l u d e s proceeds from the I l l i n o i s Turnpike Authority o f f e r i n g of h l $ m i l l i o n and the Public Housing Autho r i t i e s i s s u e of 122 m i l l i o n . The c o r p o r a t e calendar of l a r g e o f f e r ings t o t a l s £8 m i l l i o n d o l l a r s . The I l l i n o i s S t a t e T o l l Highway Commission sold the bO-year turnpike i s s u e w i t h a coupon of 3 3/k per c e n t . As a r e s u l t of a l e g a l a c t i o n which developed on Tuesday opposing the s a l e of the bonds, the S t a t e must c l e a r the bonds of a l l l i t i g a t i o n within days, with a provision f o r a l^-day extension, or t h e underwriters w i l l r b e f r e e d of a l l o b l i g a t i o n t o purchase t h e bonds. The bonds were r e o f f e r e d a t par by t h e underwriters contingent on the c l e a r ance. Bond y i e l d s - Outstanding corporate and S t a t e and l o c a l government high-grade bond y i e l d s decreased s l i g h t l y while Treasury o b l i g a t i o n y i e l d s ' r o s e s l i g h t l y during the week ending October 21. A moderate decrease occurred in S t a t e and l o c a l government Baa bond y i e l d s . Yields on corporate Baa and S t a t e and l o c a l government revenue bonds remained s t a b l e . Daily f i g u r e s i n d i c a t e d t h a t U. S. Government bond y i e l d s dropped on Monday and remained steady on Tuesday of t h i s week. The y i e l d on a new Aa-rated 30-year f i r s t mortgage e l e c . t r i e power bond o f f e r e d l a s t week was seven b a s i s p o i n t s higher and the y i e l d cnan A-rated bond was seven b a s i s p o i n t s lower than y i e l d s on outstanding bonds of somewhat s h o r t e r m a t u r i t y . This spread f o r A-rated i s s u e s appears to have changed s u b s t a n t i a l l y since August and September, t h o u ^ t h e r e have been only t h r e e such i s s u e s s i n c e e a r l y June. Stock p r i c e s - Stock p r i c e s , a s measured by t h e SEC index of 265 common s t o c k s , rose 6.9 p o i n t s l a s t week i n a moderately small volume of t r a d i n g . P r i c e s rose on Monday of t h i s .week but decreased on Tuesday and Wednesday according t o d a i l y indexes. 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. . EXHIBI1 A H I G H - G R A D E B O N D YIELDS Weekly Per c e n t p e r a o n u m Corporate Aaa 3/ U. S. Govt, long-term 2 / Spread between State and local U. S. Govt, and govt., Aaa 3 / Corporate State and Aaa local Aaa (Per cent) 3.03 2.91 3.42 2.99 3.09 2.85 3.3it 2.91 (lA) (2/15) (6/19) (1/9) (1/8) (h/23) (9/9) (1/7) 3.13 3.12 3.12 3.11 3.10 2.79 (12/27) 2.78 (12/26) 2.7U (V?) 2.00 (10/23). 1.65 (5/1) 2.73 (6/25) 1.98 (1/8) 2.21 (6/10) a2.62a (1/7) a 1.90 (9/2) 2.3U (9/8) 2.05 (5/26) ,2.89 2.86 2.83 2.81 2.82 2.27 2.27 2.27 2.25 2.2k .37 .19 .38 .19 .1*3 '11 .13 s 1.02 a.29 .*5U .62 .29 .30 .28 1 1/ Weekly average of dally f i g u r e s . Average term of bonds included i s 25-26 years. '• 2 / Weekly average of daily f i g u r e s ; old s e r i e s . Average term t o f i r s t c a l l of bonds included i s 11-11; years. 3 / Thursday f i g u r e s . Only general obligation bonds are included; average term I s 20 years. Note.—Hig&s and lows are for individual series and may-be on d i f f e r e n t dates or differeat series. Digitized for fFRASER EXHIBIT B L O W E R - G R A D E B O N D YIELDS Weekly Per cent p e r \ - l 3.5 STATE AND LOCAL GOVT. 1952 1953 1954 Corporate Baa y 1955 State and local govt. Baal/ State and local govt, rev. 2 / (Per cent) 1552 - High Lor 1953 - High Lor 195U - High Lor 1955 - High September 23 September 30 October 7 October 1U October 21 3.63 3.U8 3.69 3.50 U 3.58 ii (VI.) (5/16) (9/18) (1/2) l X 2.98 (10/23) 2.48 (U/17) S W I f , 1S2! 3.25 (9/22) 3.02 (1/6) lit 3.23 3.22 3.20 2.69 (12/19) 2.27 (lt/25) 3.27 (6/26) 2.71 (1/2) 3.00 (lA) 2.72 (8/13) i:?i 2.90 2.90 . 2.90 2.89 2.89 V Weekly average of daily f i g u r e s . Average term of bonds included i s 25-26 years. 2 / Thursday f i g u r e s . Cbly general obligation bonds are included} average term i s 20 years. 2 / Friday f i g u r e s . Average rating of bonds included i s between Baa and A; average term i s 20 years. Note.—Higfcs and lows are f o r individual series and may be on d i f f e r e n t dates f o r d i f f e r e n t s e r i e s . STOCK MARKET STOCK MARKET CREDIT Stock p r i c e index y stock (millions yields 2 / of s h a r e s ) (Per c e n t ) Stock market cust<m e r c r e d i t Customers* debit b a l ances y "others" £ / ( M i l l i o n s of d o l l a r s ) 1952 - Higi 1953 - High Lor 195U - High 1955 - High Lew September October 7 October lit October 2 1 165.3 (12/26) 151.7 (10/21;) 167.1 (1/2) i a . 0 (9/18) 221.1* 156.5 269.7 217.lt (12/31) (1/6) (9/23) (1M) 1§:I 251.2 2L5.9 252.8 2.0 0.9 2.5 0.9 3.7 14 1*.6 1.5 5.77 5.13 5.75 5.15 5.33 1*.20 It .22 3.78 1,986 1,801* 2,145 2,055 3,W6 2,105 3,966 3,537 1,332 1,2 i a 1,665 1,3% 2,388 1,653 2,805 2,517 656 552 780 661* 1,01*8 71*6 1,177 1,018 1.8 2.9 2.1 2.1* 1.7 3.91 3.93 3,865 3,966 2,710 2,805 1,155 1,161 1/1,11*8 1,159 r / Revised n.a.—Not a v a i l a b l e . V SBC index of 265 common s t o c k s , weekly c l o s i n g p r i c e s , 1939-100; converted t o 1957-1*9-100 b y F e d e r a l Reserve. The conversion f a c t o r i s 123.91. 2 / Averages of d a i l y t r a d i n g vtiluae on the New Tork Stock Exchange. V Moody's 200 common s t o c k s ; end of month f i g u r e s . 5 / End of month f i g u r e s f a r member f i r m s of t h e New York Stock Exchange which c a r r y margin a c c o u n t s ; excludes b a l a n c e s secured by D. S . Government o b l i g a t i o n s . £ / Wednesday f i g u r e s f o r weekly r e p o r t i n g member b a n k s . Excludes a l l loans f a r p u r c h a s i n g or c a r r y i n g U. S . Governments f a r 1952; s i n c e 1953 only t h e s e l o a n s a t banks i n New Ttrk and Chicago a r e excluded. Weekly r e p o r t i n g banks account f o r about 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 a r e f o r i n d i v i d u a l s e r i e s and may be on d i f f e r e n t d a t e s for different series. H.llt Exhibit D Corporate and S t a t e and Local Government Security Offerings and Placements (In millions of d o l l a r s ) January February March April May June July August September y New c a p i t a l 1955 Corporate 1 1954T I 1953 1955 246 436 1,261 547 426 635 623 #3 666 535 312 538 3# 411 565 390 360 426 49k 903 697 497 6^6 842 779 675 1,123 427 350 641 734 748 . . 853 329 649 434 531 909 335 747 4% 325 753 470 e/%35 eZ390 279 261 649 519 259 475 1,003 290 6o4 577 e/900 594 423 877 453 408 774 1,608 1,995 1,991 1,896 7,490 1,912 2,578 1,385 1,418 S/1,095 1,372 2,334 1,188 1,894 6,789 1,176 1,412 1,253 1,636 5,477 i © October November December e/l,2$0 1 s t quarter 2nd quarter 3rd quarter 4th q u a r t e r Year 2,21(3 2,09k 3/2,030 IS 2 ^ 2 / 8,li95 Stabe and l o c a l 1 1954 1 1953 Excluding"finance companies 3/ 1st quarter 2nd quarter 3rd quarter 4th quarter Year 1,791 1,912 1,527 1,927 1,911 1,792 7,158 1,669 1,991 1,223 2,344 7,227 1/ Includes 637,2 m i l l i o n d o l l a r AT&T convertible debenture i s s u e . 2 / Includes 602 0 $ m i l l i o n d o l l a r AT&T c o n v e r t i b l e debenture i s s u e . 3/• 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. Note,—Details may not add t o t o t a l s due t o rounding. I H.lU 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) 1/ Proceeds of Large I s s u e s Offered (MLllicns of d o l l a r s ) Corporate Month 195h - September October Novenib er December 1955 - January February March ' April' May 36k k33 0 121 Htl 63 750 173 h83 July August September 101 1+05 328 S t a t e and l o c a l government li55 388 268 6# 3hl 107 337 238 152 h03 278 65 23k • Other 2 / 30 35 15 . 1 Large I n d i v i d u a l Issues Offered October 1 through 21 Issuer Type 3j Amount Coupon (millions Maturity r a t e or Offering Rating of net i n t e r yield dollars) e s t cost CORPORATEPublic Service E l e c t r i c •and Gas Deb. 35.0 American T e l . & T e l . Conv. deb. 637.2 Southern B e l l T e l . & T e l . Deb. 30.0 Burlington I n d u s t r i e s Sub. conv. deb. 30.0 N.Y. S t a t e E l e c t r i c & Gas 1st mtg9 bdso 15.0 - 1975 1967 1995 1975 1985 3 3 3 k 3 1/2 7/8 1A iA 3/8 3.35 3 7/8 3.20 ii.25 3.25 .A Aa Aaa - Ba A 2.25-2.15 2.10 1.60-2.95 2.35-2.50 2.15-2.85 A A A Aaa A STATE AND LOCAL GOVERNMENT Cook County, I l l i n o i s S t a t e of Tennessee Monterey Co., C a l i f . N.Y. S t a t e Thruvray Auth. Orleans P a r i s h , La. G.O. G.O. G.O. G.R. G.O. liO.O 8.6 7.0 50.0 6.0 1956-75 1966-67 1957-95 1985-95 1961-95 2.5k 2.19 2.70 2.52 2.80 H.Ik , E-2 Large I n d i v i d u a l I s s u e s Offered October 1 through 21 (Cont'd) Issuer Type 3/ Coupon Amount Offering (millions Maturity r a t e or yield net i n t e r of dollars).! est cost Rating STATS AND ICCAL GOV5RNL5ENT (Cont'd) P h i l a d e l p h i a , Pa. J e r s e y C i t y Sewerage Auth, Coming, Nevr York GeO. Rev. G.O. 39.9 13.0 5.1 1957-81 1959-93 1956-81; 2.58 3.35 2.27 1.80-2.65 2.35-3.35 1.1:5-2.35 A Baa Aa ' OTHER 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 d o l l a r s 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 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 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 c , 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, 1 . 1 . 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. « Exhibit F Forthcoming Large Public S e c u r i t y Offerings f o r New C a p i t a l (Other than U« S , Treasury) 1 / Expected Proceeds from Forthcoming Large I s s u e s During month following Subsequent t o date shown date shown S t a t e and S t a t e and Other 2y Corporate Other 2 / Corporate l o c a l govt» l o c a l govt. Date of computation 19$k - S e p t . 30 Oct. 29 Nov. 30 Dec. 31 1955— J a n . 31 - . Feb. 28 Mar. 31 Apr. 29 May ; 31 June 30 July 29 Aug. 31 S e p t . 30 3k3 15 9k m 16 710 211 1425 160 67 1*07. 222 805 383 L36 661 567 682 52lt 208 116 339 3a 100 184 82*3 30 ..— . 2,158 1,957 2,682 2,1a 1,961 1,978 2,009 1,917 1,861 1,815 2,018 1,971 2,205 m 135 2i|6 216 k22 1,395 922 1,31a 850 830 1,135 920 909 • 30 30 35 — Forthcoming Large O f f e r i n g s , as of October 2 1 Issuer Type Amount (millions Approximate date of o f f e r i n g of d o l l a r s ) CORPORATE Common stock 1st mtg. b d s . Deb. Deb. 1st mtg. bds Common stock Common stock Bonds Deb. October 25 October 26 ONOOOOOOOO Pfd. stock 1st mtg. b d s . OO P a c i f i c Gas and E l e c t r i c Long I s l a n d Lighting Southern New England Telephone and. Telegraph United Gas New England Telephone & Telegraph •^National Tea Company ^Michigan Consolidated Gas C ommonvrealth. Edis on Southern Co. Southern C a l i f o r n i a Gas New J e r s e y B e l l Telephone October 28 November 9 November 15 November 15 November 16 November 16 November 22 November December lU STATE AND LOCAL GOVERNMENT I l l i n o i s Turnpike Authority Public Housing A u t h o r i t i e s Cleveland, Ohio Rev. Rev. U5.0 122.3 9.0 October 25 October 26 October 27 H.lh F-2 Forthcoming Large Offerings, as of October 21 (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 ) STATE AND LOCAL GOVERNMENT (Cont'd) Florida S t a t e Board of Education S t a t e of California *Port of New Orleans, Louisiana ^Hamilton County, Ohio Dallas, Texas S t . Louis Bd. of Education, Missouri Onondaga Go. Water Authority, N. Y. . T e r r i t o r y of Hawaii Commonwealth of Massachusetts Los Angeles, C a l i f o r n i a S t a t e of Colorado C a l i f o r n i a Toll Bridge Authority Connecticut Expressway Inter-American Center Auth., F l a . Texas Turnpike Company Michigan Turnpike Authority C a l i f o r n i a Toll Bridge Authority Louisiana Turnpike Commission Oklahoma Turnpike Authority' Pennsylvania Turnpike Comission Washington S t a t e Toll Bridge Auth. Rev. G.O. G.O. G.O. n.a. n.a. Rev. n.a • n.a. n.a. Rev. Rev. Rev. Rev. Rev. Rev. Rev. Rev. Rev. • Rev. 10.6 60.0 10.0 5.7 10.0 6.5 12.6 7.5 159.9 20.0 8.0 h6o0 100.0 25.0 137.0 186.0 235.0 100.0 11+6.0 62.0 227.0 November November November November November November November November November December December December 1955 1955 1955 1955-56 1955-56 1955-56 1955-56 1955-56 1956 1 2 3 3 10 15 15 16 16 6 6 13 OTHER None ! n.a.—Not a v a i l a b l e . *—Included i n t a b l e f o r f i r s t time'. 1 / Includes corporate and other i s s u e s of 15 million d o l l a r s and over; State and l o c a l government issues of 5 million and over. 2 / Includes f o r e i g i 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 . # It) H.14 Exhibit G Yields on New and Outstanding E l e c t r i c Power Bonds, Rated Aa and A 1 / Date Aa-rated o f f e r i n g f 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 cent) seasoned yields (per cent) seasoned y i e l d s (basis points) (basis points) 1952 average 3.16 13 1953 average 3.46 16 1954 average . 3.35 12 3.78 26 3.03 3 3.12 -3 1954 - January February Mnrch • April May June July August September October November December 3.19 3.01 *2.93 2.99 3.00 *3.00 None None 3.02 3.03 None None 6 -1 0 5 *3.35 *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 1955 - January • February March April . May June July *3.15 *3.14 *3.17 None *3.22 *3.20 None August 31 September li; 21 October 19 20 3.32 3.25 - k 1 3 .3 — 13 7 8 10 7 — 10 7 . None *3.23 3.29 3.31 3.35 *3.30 None 0 9 14 16 14 10 — 3.57 3.50. 30 23 3.25 -7 2 / Covers only 30-year f i r s t mortgage bonds, as reported in Moody's Bond 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 the indicated period and of the d i f f e r e n c e s between these new o f f e r i n g y i e l d s and y i e l d s on seasoned issues of similar q u a l i t y f o r the same day. The number of new i s s u e s included i n the monthly averages v a r i e s from 2 t o 4 exccpt f o r October 1954 when 6 issues were included. Average maturity f o r the seasoned issues v a r i e s from 26 t o 28 y e a r s .