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Not f o r P u b l i c a t i o n WOOTBOLLED AFTER SIX MONTHS H.Ik September 29, 1955 CAPITAL IIARKET DEVELOR5ENTS Large p u b l i c s e c u r i t y o f f e r i n g s i s s u e d f o r new c a p i t a l during the week ending September 23 t o t a l e d 82 m i l l i o n d o l l a r s f o r c o r p o r a t i o n s and 60 m i l l i o n f o r S t a t e - a n d l o c a l governments, S t a t e and l o c a l governments expect t o f l o a t 106 m i l l i o n d o l l a r s of l a r g e "issues thisirreek—including a 6? m i l l i o n dol3ar Richmond-Petersburg Turnpike o f f e r i n g , One c o r p o r a t e p r e f e r r e d stock o f f e r i n g of 35 m i l l i o n - d o l l a r s i s scheduled. Most of the l a r g e i s s u e s f l o a t e d l a s t week and the f i r s t p a r t of t h i s week were, w e l l r e c e i v e d by i n v e s t o r s * As a r e s u l t , d e a l e r s have continued to maintain low inventories. Bond y i e l d s - Aaa S t a t e and l o c a l government outstanding bond y i e l d s dropped f i v e b a s i s p o i n t s during t h e week ending S e p t ember 2 3 . Yields on corporate Aaa and Ue S . Government long-term bonds did not change. Corporate Baa and S t a t e and l o c a l government revenue bond y i e l d s decreased moderately while S t a t e and l o c a l government Baa . bond y i e l d s remained s t e a d y . A sharp drop i n Treasury o b l i g a t i o n y i e l d s occurred on Monday, of t h i s week with a f u r t h e r d e c l i n e on Tuesday according t o d a i l y f i g u r e s . There was l i t t l e change i n corporate y i e l d s during the same p e r i o d . As shown i n Exhibit G, the y i e l d on a newly-offered 30-year f i r s t mortgage e l e c t r i c power bond with Aa-rating was t e n b a s i s p o i n t s above y i e l d s on s i m i l a r l y - r a t e d outstanding bonds of somewhat s h o r t e r m a t u r i t y . The spread f o r t h i s i s s u e — t h e f i r s t of t h i s r a t i n g t o be o f f e r e d since June—is j u s t s l i g h t l y above t h e average f o r the months of 1955 i n which t h e r e have been new o f f e r i n g s . Stock p r i c e s - The SEC index of 265 common stocks r o s e t o a new high of 269.7 during the we el: ending September 23. On Monday of t h i s week p r i c e s declined sharply—for t h e i n d u s t r i a l averages, i t was the l a r g e s t drop i n absolute terms in one day s i n c e 1929. Percentagewise, however, the 6.5Zt per c e n t d e c l i n e i n t h e Dow-Jones i n d u s t r i a l s was somewhat smaller .than i t had been i n e i t h e r May 19^0 or October 1937. Transactions.on the New York Stock Exchange t o t a l e d 7,720 m i l l i o n s h a r e s , the g r e a t e s t volume since J u l y 21, 1933. P r i c e s regained more than t w o - f i f t h s of Monday's l o s s i n the next two days on trading volume lower than on Monday but s t i l l heavy. 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 FRASER of Governors of the F e d e r a l Reserve System. Digitized for EXHIBIT A H I G H - G R A D E BOND YIELDS W.mkly Corporate Aaa 1/ Date U. S. Govt, long-term 2/ Spread between State and local U. S. Govt, and govt., Aaa 3/ Corporate State and local Aaa (Per cent) 1952 - High 1953 - High Low 1954 - High Low 1955 - High Low 3.03 2.91 3.12 2.99 3.09 2.85 3.lit 2.91 August 26 September September September September 3.12 3.13 3.14 3.13. 3.13 2 9 16 23 (1A) (2/15) (6/19) (1/9) (1/8) (4/23) (9/9) (1/7) 2.79 2.56 3.15 2.78 2.74 2.a 2.94 2.62 2.91 2.91 2.88 2.89 2.89 (12/27) (5/17) (6/6) (12/26) 0/9). (8/7) (8/5) (1/7) 2.00 1.65 2.73 1.98 2.21 1.90 2.34 2.05 2.34 2.34 2.34 2.32 2.27 (10/23) (5/1) (6/25) (1/8) (6/10) (9/2) (9/8) (5/26) . .37 .19 .38 .19 .43 .32 .34 .13 1.02 .71 .84 .30 .61 .29 .70 ,54 .21 .22 .26 .24 .24 .57 •57 .54 .57 .62 1/ Weekly average of daily figures. Average term of bends included is 25-26 years. 2/ Weekly average of daily figures; old series. Average term to f i r s t call of bonds included is 13-14 years. 2/ Thursday figures. Only general obligation bonds are included; average term i s 20 years. Note.—Highs and lows are far individual series and may be on different dates for different series. - G R A D E BOND YIELDS Per cent p e r CORPORATE B a a V ' •V— STATE AND LOCAL GOVT. REVENUE Corporate Baa y Date State and local govt. Baa 2/ State and local govt, rev. 3/ (Per cent) 1952 - High Low 1953 - Hi#i 195k - High Low 1955 - High Low 3.63 3.18 3.89 3.50 3.71 3.a 3.59 3.15 August 26 September September September September 3.58 3.58 3.59 3.59 3.58 2 9 16 23 (1/10 (5/16) (9/18) (1/2) (1/8) (12/31) (9/16) (1M) 2.69 (12/19) 2.98 (10/23) 2.U8 (1/17) ' 2.27 (4/25) 3.27 (6/26) 3.79 (6/25) 2.96(1/8) - 2.71 (1/2) 3.00 (1/1) 3.32 (1/7) 2.72 (8/13) 2.93 (8/5) 3.25(9/22) 2.95 (9/2) 3.02 (1/6) 2.76 (1/7) 3.23 3.23 3.25 3.25 3.25 1/ Weekly average of d a i l y f i g u r e s . included i s 25-26 y e a r s ; 2.95 2.95 2.93 2.92 2.90 Average, term of bonds 2/ Thursday figures. Only general obligation bonds are included; average term is 20 years. 3/ Friday figures. Average rating of bonds included i s -between Baa and A; average term is 20 years. Note.—Highs and lows are 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 f o r d i f f e r e n t s e r i e s . .952 Date Stock p r i c e .953 ,954 Common Trading volume 2 / ( m i l l i o n s y i e l d s 3/ of s h a r e s ) (per c e n t ) Stock market customer c r e d i t Customers' debit b a l - loans to ances A/ " o t h e r s " 21 Total ( M i l l i o n s of d o l l a r s ) 1955 - Hi#i Low 165.3 ' 151.7 167.1 lWwO 221.li 156.5 269.7 217.lt July August September 9 September 16 September 23 257.3 25U.5 262.3 267.lt 269.7 1952 - High 1953 - High LCTT 195k - High (12/26) (10/21*) (1/2) . (9/18) (12/31) (1/6) (9/23) (1M) •2.0 0.9 2.5 0.9 3.7 iJt It.6 1.5 2 .It 1.8 2.It 2.6 2.It • ' 5.77 5.13 5.75 5.15 5.33 It.20 It .22 3.78 1,986 l,80lt 2,Ut5 2,055 3,lt36 2,lt05 3,911 3,537 1,332 . l,2ltl , 1,665 1,31U 2,388 1,653 2,73lt 2,517 3.78 • 3.91 3,911 3,865 2,73lt 2,710 , 656 . 552 780 66k l,0lt8 7lt6 1,177 1,018 1,177 1,155 1,157 1,167 n.a. n . a . Not a v a i l a b l e . 1 / SEC index of 26$ common s t o c k s , weekly 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 19^7-^9-100 by 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 volume cn t h e New York Stock Exchange. 3 / Uooc^y's 200 common s t o c k s ; end of month f i g u r e s . %J End of month f i g u r e s f c 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 U. 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 l o a n s f o r p u r c h a s i n g or c a r r y i n g U. S . Governments f o 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 York 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. Exhibit D Corporate and S t a t e and Local Government S e c u r i t y Offerings and Placements " (In m i l l i o n s of dollars)Netv c a p i t a l Corporate January February March April May June 1953 ~ 1955 S t a t e and l o y a l I 1954 J 1953 195k 546 14-36 1,261 547 426 635 623 . 623 666 535 332 538 396 Itil 565 494 49 7 656 812 779 675 1,123 427 350 641 734 748 853 329 649 ^ 434 483 e/460 5/235 6/390 279 261 649 519 259 475 594 423 877 453 408 774 1,372 2,334 1,188 1,894 6,789 1,176 1,412 1,253 1,636 5,477 903 697 July • August September # 753 1,003 290 604 October November December 1st quarter 2nd q u a r t e r 3rd q u a r t e r 4th q u a r t e r Year 1 1955 2,2ii3 2,09k 6/1,905 1,608 1,995 1,991 1,896 7,490 577 42? 1 / 1,438 ^ ' 1,912 2,578 1,385 1,418 e/l,085 8,495 390 360 . 426 Excludin g f i n a n c e companies 2 / 1st quarter 2nd q u a r t e r 3rd q u a r t e r 4t h q u a r t e r Year 1,791 ,1,912 e/l,455 1,527 1,927 1,911 1,792 7,158 1,669 1,991. 1,223 2,3W^ 7,227 e / Estimated. 1 / Includes 602 .5 m i l l i o n d o l l a r AT&T debenture 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 finance companies, 'Notes—Details may not add t o t o t a l s due t o rounding. S Exhibit E Hoik Large Fab H e 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 o'f Large I s s u e s Offered (Millions, of d o l l a r s ) Month 19A 19# Corporate - August September October November December ' January February March April May June July August S t a t e and l o c a l government Other 2 / 86 75 36U w 388 268 b33 0 68? 121 30 35 3hl 107 337 230 152 ' % 750 'All 15 U09 278 72 lto5 Large I n d i v i d u a l I s s u e s Offered September 1 through 23 Issuer Type 3 / Amount ' Coupon Offering (millions r a t e or Maturity Rating yield of net i n t e r dollars! e s t cost CORPORATE • Utah Power & Light Term. Gas Transmission Tenn. Gas Transmission GIT F i n a n c i a l Ohio Pcrjer Co. Columbia Gas System, I n c . Public Service Elec.& Gas STATE & LOCAL GOVERNMENT 1 s t mtg.bds. 1 s t mtg. PL Common s t k . Deb. 1 s t mtg. bds. Deb. Pfd. s t k . S t a t e of Delaware Essex County, New J e r s e y Middlesex Co. Sewerage A u t h o r i t y , N. J . B u f f a l o , New York Volusia Co,, F l o r i d a G.O. G.O. 7.0 8.8 1956-75 1956-76 2.12 2.20 1.1*5-2.20 1.50-2.25 Aa Aa Rev. 25.0 12.8 8.0 1962-95 1956-70 1961-81: 3.33 1.89 3.35 2.50-3.35 1.1+0-2.00 2.60-3.35 Aaa Baa GoO. G.R. 15.0 50.0 16.0 100.0 17.0 i-OoO 25.0 1985 , 1976 1970 1985 1980 3 5/8 3 7/8 3.50 3.80 3 5/8: 3.75 3 3 / 8 " 3.32 3.63 _3 5 / 8 A A Aa A E.Ik E-2 Large I n d i v i d u a l I s s u e s Offered September 1 through 23 (Cont'd) Issuer Type 3 / Amount Coupon (millions r a t e or Offering Maturity Rating of yield net i n t e r dollars) e s t cost 33ME AID LOCAL GOVERNMENT . (Cont'd) D e t r o i t , Michigan Los Angeles, C a l i f o r n i a S t a t e of NeiT Mexico Chicago Regional Port i District, Illinois G.O. Rev. L.L. 9.1 18.0 8.9 1956-80 1956-85' 1956-65 2.62 2.52 2.09 1.50-2.70 1.50-2.60 1.50-2.05 Rev. 2U.0 1995 nca. It.00 A Aa Aa — OTHER None - 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 " a n d 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 issues„ 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., 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. r / Revised. H.ll* Exhibit F Forthcoming Large Public S e c u r i t y O f f e r i n g s 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 ! Subsequent t o During month following i date sham d a t e shown I S t a t e and | Other 2/ 1 S t a t e and |Other 2 / jCorporate Corporate 1 l o c a l govt. I local govt. Date of computation 195k - Aug. 31 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 J u l y 29 Aug. 31 ± 33U 313 15 9k I84 16 710 211 • lt25 160 67 1+07 222 300 363 436 661 567 632 52k 208 116 339 608 hi k 30 k22 — 3hh 100 181 135 21*6 216 ' —" 1,395 922 l,UUl 850 830 .1,135 920 1,876 2,158 1,957 2,682 2,1hk 1,961 1,978 2,009 1,917 1,861 1,8U5 2,018 1,971 30 30 35 — — — — •— — Forthcoming Large O f f e r i n g s , as of September 23 Issuer Type Amount Approximate de.be (millions of o f f e r i n g of d o l l a r s ) CORPORATE Kaiser Aluminum & Chemical Public Service E l e c t r i c and Gas American Telephone and Telegraph Southern B e l l Telephone and Telegraph Long Island Lighting New York S t a t e E l e c t r i c and Gas *Mew England Telephone & Telegraph ^•Southern Co. Southern C a l i f o r n i a Gas P a c i f i c Gas and E l e c t r i c Freedom Insurance Company P f d . stock Deb. Conv. deb. 35.0 35.0 637.2 September 28 . October October 13 Deb. 1 s t mtg. b d s . 1 s t mtg. b d s . Deb. Common stock Bonds P f d . stock Common stock 30.0 October 17 October 26 October November 15 November 22 November November 1955 i5.o 15.0 30.0 30.0 1*0.0 25.0 22.0 STATE AND LOCAL GOVERNMENT Warren Township, Michigan Baltimore County, Maryland Sedgwick County, Kansas Richmond-Petersburg Turnpike Auth. G.O. G»0. G.O. Rev. 15.0 69.0 September September September September 27 28 28 28 • H.lfc F-2 Forthcoming Large O f f e r i n g s , as of September 23 (Cont'd) Issuer i 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) I n d i a n a p o l i s , Indiana Cook County, I l l i n o i s ttState of Tennessee ^Montgomery Co., C a l i f o r n i a Orleans P a r i s h , Louisiana P h i l a d e l p h i a , Pennsylvania ^Public Housing A u t h o r i t i e s Texas Turnpike Company I l l i n o i s Turnpike Authority State o f California T e r r i t o r y of Hawaii "Connecticut Expressway Inter-American C e n t e r J h i t h . , F l a . Michigan Turnpike Authority S t a t e of Louisiana C a l i f o r n i a T o l l Bridge Authority Louisiana Turnpike Conmission C a l i f o r n i a T o l l Bridge Authority Nerr York S t a t e Thruway Authority Oklahoma Turnpike Authority Washington S t a t e T o l l Bridge Auth. G.O. — Rev. . Rev. • Rev. -r Rev. Rev. Rev. Rev. Rev. G.R. Rev. Rev. 6.6 iiO.O 8.6 7.0 6.0 39.9 120.0 130.0 liOO.O 60.0 7.5 100.0 2^.0 186.0 80.0 235.0 100.0 2*3.0 125.0 11*6.0 227.0 October h October 10 October 10 October. 11 October 13 October 18 October 26 October October November 2 November 16 1955 1955 1955 1955 1955 1955 1955 1955 1955 1956 OTHER None 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 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 . 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. Exhibit G Yields on New and Outstanding E l e c t r i c Powor Bonds, Rated Aa and A 1/ Date A- r a t e d o f f e r i n g y i e l d s Aa-rated o f f e r i n g y i o l d s Amount above Amount above Actual Actual (per cent) seasoned y i e l d s (per c e n t ) seasoned y i e l d n (basis points) (basis points) 1952 average 3.16 13 1953 average 3.46 16 ¥9$h average w 3.35 12 3.78 26 3„.03 3 3.12 -3 19$k - January February March 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 1925 - January February March April May June July *3.15 *3.lU *3.17 None *3.22 *3.20 None — 3.32 10 August 31 September l i | 21 b 1 3 3 — 13 7 8 10 7 None *3.23 3.29 3.31 3.35 *3.30 None 3.57 3.50 0 9 Hi 16 . lb 10 — 30 23 * Single o b s e r v a t i o n , not an average. 1 / Covers only 30-year f i r s t mortgage bonds, a s r e p o r t e d i n Moody's Bond Survey. Except "where i n d i c a t e d , t h e a c t u a l y i e l d f i g u r e and t h e amount above seasoned y i e l d s a r e averages of o f f e r i n g s d u r i n g 'the i n d i c a t e d p e r i o d 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 the same day. The number of new i s s u e s included i n t h e monthly averages v a r i e s from 2 t o it except f o r October 19%k when 6 i s s u e s were included. Average m a t u r i t y f o r the seasoned i s s u e s v a r i e s from 26 t o 28 y e a r s .
@FedFRASER