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Not f o r Publication DECONTROLLED AFTER SIX MOUTHS
H.lii

January 31, 1957
CAPITAL MARKET DEVELOPMENTS

The volume of public security financing continues to be
substantial. Curing the week ending January 25, corporations sold
large i s s u e s totaling §111 m i l l i o n , including expiration of subscription rights f o r a %p6l million stock i s s u e , and State and l o c a l
government offerings amounted to $32 million. This week rights expire on a
million debenture i s s u e and two other corporate debt
i s s u e s with aggregate proceeds of #60 million are expected. Two
large State and l o c a l government o f f e r i n g s t o t a l i n g &79 m i l l ion are
scheduled for s a l e .
^
Bond y i e l d s - Yields on a l l types of outstanding bonds
declined l a s t week, with the decline being quite sharp l o r Government bonds and the higher grade corporate and State and l o c a l government bonds. The Port of New York Authority offering t h i s week of
A-iated consolidated revenue bonds was only 3 points above a comparable
issue i n September of l a s t year and U8 basis points above a comparable
i s s u e i n May of 1956. The r i s e i n y i e l d s o'ri these Authority issues
over t h i s 8-month period has been much l e s s than the increase i n
y i e l d s on comparable outstanding revenue bonds, which have increased
more than 30 points since September. -

May 21, 1956
Sept. 6 , 1956"
Jan. 29, 1957

Amount
(millions
of dollars)

Maturity

Net
interest

New i s s u e

30.0
25.0
50.0

1986
1986
1987

3,0k
3.52
3.5h

3.00
3.15
3.1*8

1 / As measured by Dow-Jones 10 revenue bond average.




Yield
Outstanding 1 /
3. Oil
3.51
3.8k

— 2

—

Estimated February volume - The corporate volume of new
capital issues f o r February i s estiinated a t $1,000 m i l l i o n s l i g h t l y
below the estimated January volume but t w o - f i f t h s greater than the
volume i n February l a s t year. Large publicly offered i s s u e s are
expected to t o t a l nearly $600 mill ion, including the expiration of
subscription rights f o r the very large i s s u e s of Socony Mobil Oil
Company and P h i l l i p s Petroleum Company,
State and l o c a l government i s s u e s for February are currently
estimated at %pit00 million. This t o t a l would be 1*0 per cent below
both the volume t h i s January and in February of l a s t year. I t shox^Ld
be noted, however, that the combined t o t a l f o r the f i r s t two months
of t h i s year i s only s l i g h t l y l e s s than the corresponding t o t a l f o r
19#.
Stock prices - Stock prices, as measured by the SEC index
of 265 common stocks increased s l i g h t l y l a s t week, closing at 268.2
on January 25. Daily f i g u r e s through Wednesday of t h i s week indicate
some further increase i n p r i c e s .

Business Finance and Capital Markets Section,
Division of Research and S t a t i s t i c s ,
Board of Governors of the Federal Reserve System.




EXHIBIT A

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

V

A

U. S. Govt., long-term 2/

tote

1956

,955

1953

Corporate
Aaa 1 /

Old s e r i e s

New s e r i e s

Spread between
State and
D. S. Govt,
l o c a l gort. (old s e r i e s ) and
CorporatelState and
Aaa J /
Aaa
1local Aaa

(Per cent)
3.1*2
2.99
3.09
1951 - High
Low
2.85
3.17
1955 - High
LOW
: 2.91
1956 - High!1 3.79
Low
3.07
1953 - High

December 28
January It
January 11
January 18
January 25

(6/19)
(1/9)
(1/8)
(li/23)
(12/23)
(1/7)
(12/28)
(3/2)

3.79
3.82
3,81
3.78
3.73

3.15
2.78
2.7k
2.kk
2.9k
2.62
3.U9
2.80

(6/6)
(12/26)
(1/9)
(8/7)
(8/5)
(1/7)
(12/21)
(2/17)

3.1*8
3.53
3.k5
3-30
3.22

1 / Weekly average of d a i l y f i g u r e s .

n.a.

3.03
2.89
3.39
2.92

2.73
1.98
2.21
1.90
(8/5) 2.3k
( 6/10) 2.05
(12/28) 3.05
(2/3)
2.17

3.39
3.U5
3.kk
3.37
3.31

3.05
3.05
3.05
3.02
2.96

(6/25) • .38
(1/8)
.19
(6/10)
.k3
(9/2)
.32
(9/8)
.3k
(5/26)
.13
(12/27)
.kk
(2/23)
.13

.8k
.30
.61
.29
.70
•5k
.66
.32

•

.k3
.k8
.kO
.28
.26

.31
.29
.36
.k8
.51

Average term of bonds included i s 25-26

2 / Weekly averages of d a i l y f i g u r e s . The old s e r i e s includes f u l l y t a x a b l e ,
marketable 2 1/2 per cent bonds due or f i r s t c a l l a b l e a f t e r 12 years through
September 1955j and those due or c a l l a b l e in 10-12 years t h e r e a f t e r ; the average
term to f i r s t c a l l of t h e bonds included declined from lit years i n e a r l y 1953 t o
11 1/2 years i n early 1956. The new s e r i e s i s comprised of the 3 per cent bond
of 1995 and the 3 l / k p e r cent bond of 1978-83.
2 / Thursday f i g u r e s . Only general obligation bonds a r e included; average
term i s 20 y e a r s .
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 dates
for different series.




LOWER - GRADE BOND YIELDS

1956

Corporate
Baa 1 /

State and
local govt.

State and
local govt.
" • y

(Per cent)
1953 - High
Low
195k - High
Low
1955 - High
Low
1956 - High
Low

3.89
3.50
3.7k
3.W
3.63
3.U5
It.ltl
3.58

(9/18)
3.79
(1/2)
2.96
(1/8)
3.32
(12/31)
2.93
(12/30) . 3.26
(I/Hi)
3.02
(12/28)
It. 22
(3/9)
3.20

December 28
January It
January 11
January 18
January 25

lt.ltl
1 h.h6
j U.h9
lt.50
lt.lt8

It. 22
It. 22
It. 22
14.17.
It. 13

3.27 (6/26)
2.71 (1/2)

3.00 (1/1)

6)

2.72
2.99
2.76
3.98
2.89

(8/13)
(12/30)
(1/7)
(12/28)
(2/2lt)

3.98
3.98
3.95
3.90
3.81

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




Stock price
index 1/

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

Stock market customer-credit
Customers1
debit balances It/ "others" 5 /
(Millions of dollars)

1956 - High
Low .
1957 - High
Low

221.U
156.5
270.7
217.it
295.5
257.lt
279.2
267.lt

November
December
January 11
January 18
January 25

273.1
277.7
277.1
267.lt
268.2

195U - High
. Low
1955 - High

(12/31)
(1/6)
(12/30)
(1/lU)
(8/3)
(1/20)
(1/U)
(1/18)

3.7
l.lt
U.6
1.5
3.1
1.5
2.7
2.1

5.33
It. 20
It. 22
3.78
it. 25
3.86

3,U36
2,lt05
U,030
3,537
U,0U7
3,9Ht

2,388
1,653
2,805
2,517
2,823
2,7lt0

1,0U8
7lt6
l,2ltl
1,018
1,267
1,155
1,163
1,1U7

2.2
2«It
2.U
2.3
2.1

It. 25
It. 13

3,91*6
3,981t

2,781t
2,823

n.a.

n.a.

n.a.

1,162
1,161
1,157
l,llt7
n.a.

n.a.—Not; available
1/ SEC index of 265 common stocks, weakly closing prices, 1939-100; converted
to 19u7-U9*100 by Federal Reserve. The conversion f a c t o r i s 123.91.
2/ Averages of daily trading volume on the New York Stock Exchange.
3/ Moody's 200 common stocks; end of month f i g u r e s . V/ End of month figures f o r member firms of the New York Stock Exchange which
carry margin accounts; excludes balances secured by U. S. Government obligations.
5/ Wednesday figures f o r weekly reporting member banks. Excludes loans f o r
purchasing or carrying U. S. Government s e c u r i t i e s a t banks i n New York and Chicago.
Weekly reporting banks account f o r about 72 per cent of loans to others.
Note.—Highs and lows are f o r individual series and may be on d i f f e r e n t dates
for different series.




H.lU

i x h i b i t D.
Corporate and State and Local Government
Security Offerings and Placements

%'

(In millions of dollars)

1957
January
February
March

New capital
1955

U78
886
687

377
Ii90
- 735

6I4JL

1,066
669
836

597
6hk
670

376
199
333

. 778 g /
e/1,057 *
e/950

1,162'^
632
900

2,073
2,790
2,571
e/2,785
U,863
7,U3U
e/10,219

April
May
June

816
l,lhk
830

JulyAugust
September
October
November
December

1 s t half
Three quarters
Year

e/660
. e/hCO

1955
535
312
538

535
U07
1,223.

quarter
quarter
quarter
quarter

State and l o c a l
1957
I 1956
I
UOU
696
390

579
70ii
790

jjlst
2nd
3rd
Uth

e/1,050
e/l,0C0

Corporate
1 1956
1

U27

U70
2U9 W6

6U5
3(325
e/liOO

919
658
li08

2,165
2,052
1,911
2,695

1,190
1,603
908
e/1,370

1,385
1,148.
1,12k
1,981

k,2l7
6,128
8,821

3,093
4,001
e/5,371

2,803
3,927
5,911

excluding finance companies j /
1st
2nd
3rd
Uth

quarter
quarter
quarter
quarter

Year

1,617
2,520
2,263
3/2,600

1,727
1,870
l,b3h
2,55k

e/9,060

7,569

1 / Includes #637.2 million AT&T convertible debenture issue,
2 / Includes $571«5 million AT&T common stock i s s u e .
3 / Total new capital issues excluding offerings of sales and consumer finance
companies.
Note,—Details may not add to t o t a l s due to rounding,

9



('

--

Exhibit E

' -

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

Month

Corporate

State and
l o c a l government

Other 2 /

263
95
212
278
395
623
185
592
217
558
386
701
U30

227
192
kkh
163
•157
233
U63
16U
35
18U .
383
135
201

50

1955 - December
1956 - January
February
March
April.
May
June
July
August
September
October
. November
December

50
20
37
35
—

Large Individual Issues Offered January 1 through 25

Issuer
^

"type 3 /

Amount
Coupon
Offering
(millions
rate or
Maturity
* of
yield
net i n t e r dollars)
est cost

Rating .

CORPORATE

1 s t mtg. bds,, .
'Idaho Power Co.
S.F. deb.
Standard Oil Co. of Ohio
Deb,
Aluminum Co. of America
Deb.
New England Tel.& Tel. Co.
S.F; deb.
I n t e r s t a t e Oil PL Co.
Sears Roebuck Accept. Corp.
Deb.
Deb.
Household Finance Corp.
Louisiana Power & Light Co. 1st mtg. ods.
Oklahoma Gas & E l e c t r i c Co. 1 s t mtg.bds.
Conv. sub. deb.
P a c i f i c Petroleums, Ltd.




20.0
25.0
125.0
35.0
25.0
50.0
30.0
20.0
20.0
15.0

1987
1982
1982
1986
1987
1972
1977
1987
1987
1977

•

h 1/2
hl/h
h 1/b
4 3A
UlA
h 5/8
L5/8
4 3/k
L5/8
5

'

.L50
U.25
1,25
L.60
L25
1.57
li.6o
b.6 7
U.U3
a.38

Aa
Aa
Aa
Aac
Aa
A
Aa
• —

H.Ik

B-2
Large Individual Issues Offered January 1 through 25 (Cont'd)

Issuer

Type 1 /

Amount
Coupon
rate or
[millions
Maturity net i n t e r of
dollars)
e s t cost

Offering
y i e l d Rating

CORPORATE
(Cont'd)
P a c i f i c Gas & E l e c t r i c Co. 1st & ref. mtg.
bds. "
Armco S t e e l Corp.
Common stk.

35 .0

1986

h 1/2

U.50

Aa

3.76

2.80-3.75

A

3.58
3.38
U.51
3.U9
3.31
3.33
3.33 .
3.37

2.70-3.80 A
2.50-3.50 Aa
3.00-U.50 Baa
2.50-3.25 A
2.50-3.35 A
2-.ltO-3.25, M
2.50-3.55%a
2.50-3.35 Aa
3.00-3.75 A

60.9

STATE AND LOCAL GOVERNMENT
San Antonio Ind. Sch,
D i s t . , Texas
G.O.
5.0 1958-75
Fort Worth Ind, Sch.
D i s t . , Texas
G.O.
5 . 0 1958-82
G.O.
Los Angeles, California
18.0 1958-87
Port Lauderdale, Florida
Wtr. icswr.rev. 11.0 1957-86
Caddo Parish Sch. Dist.,La
G.O.
5.0 1958-77
Dallas, Texas
G.O.
10.0 1957-76
^ D a l l a s , Texas
Rev,.
5 . 0 1957-77
#R)range Co. Flood D i s t . , Cal.
G.O.
10.0 1958-96
State of Michigan
L.L*
27.0 1958-77
• Ga. Rural Roads Auth.
L.L.
17.5 1958-72
Spokane Co. Sch. Dist. No. 81,
Washington
G.O.
6 . 0 1958-80
King Co. Sch.Dist. No. 1,
WasMngton
G.O.
10.0 1959-77
State of California
G.O.
85.0 1958-83
Alabama Highway Authority
L.L.
4 . 0 1959-76
San Antonio, Texas
Elec.&gas rev. 20.0 1958-80
Wichita Sch. D i s t No. 1, Kan.
G.O.
6.0 1958-77
Denver, Colorado
G.O.
20.0 1968-95
Columbus Sch. D i s t . , Ohio,,
G.O.
5 . 0 1958-81
Tulsa, Oklahoma
G.O.
6 . 5 1959-82
Birmingham, Alabama
G.O.
6.7 1957-87
De Kalb Co.Sch.Dist., Ga.
G.O.
5 . 1 1958-82
Boston.Metro. D i s t . , Mass.
G.O.
8.2 1957-87

3.81
2.96

2.10-2.90

Aa

3.39
3.32
3.69.
3.36
3.33
3.02

3.^5
3.U3
2.92

2.65-3 .UO
2.60-3 iiO
2.90-3 70
2.50-3 30
2.60-3 35
2.65-3, 05
2:25-2, 85
2.60-3, 35
2.50-3, 50
2.50-3. 50
2.10-3.

A
Aa
A
Aa
A
Aa
Aa
A
A
A

h 1/2

U.39

2.81

OTHER
Int. Bank for Reconstruct i o n & Development

#



Bds.

100.0

1977

.H.Ik

/E-3

1 / Includes corporate and other security o f f e r i n g s of $15 m i l l i o n and over;
State and l o c a l government security o f f e r i n g s of
m i l l i o n and over,
2j, Includes foreign government and International Bank for Reconstruction and
Development i s s u e s .
—
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 obligation3 Rev., revenue bonds; G.R., general obligations additionally
secured by f a c i l i t i e s revenues; L.L., limited l i a b i l i t y obligations secured by
pledge of designated revenues,
k / I s of 1993-96 not reoffered.




Exhibit F

H.ih

Forthcoming Large Public Security Offerings for Now Capital
(Othor than U. S. Treasury) 1/
Expected Procoeds from Forthcoming Large Issues
Date of
computation
1956 • Jan* 31
Feb. 29
Mar. 30
Apr. 30
May 31
June 29
July 31
Aug. 31
Sept. 28
Oct. 31
Nov. 30
Dec. 31
1 9 5 7 - Jan. 31

During month following
date shown
State and Other 2 /
Corporate
local govt,
176
123
380
568
198

k

V
21+7

369
315
683
436
U76
591

327
220
132
173
332
81

Subsequent to
date shown
State and
Corporate local govt. Other 2 /

37

131
s

23
100
35

1+8

280
153

917
785
811
832
91+1
690
726
958 .
1,197
955
979
763
6I4.8

376
233
1,013
818
W+8
567
1,096
1,202
1,009
990
1+81
796
966

—

—
—

- -

—

37

23
100
35

Forthcoming Large Offerings, as of January 25
Type
CORPORATE
Niagara-Mohawk Power Co.

Amount
Approximate date
(millions
of offering
of dollars)

Conv. deb.

146.2

Mountain State Tel. & Tel. Co.
May Stores Realty Corp.
Carrier Corp.
Douglas Aircraft Co.
•Stanrock Uranium Mines# Ltd.
•Potomac Electric Power Co. •Ohio Edison Co.

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

35.0

•Southern California Edison Co.
Socony Mobil Oil Co.

1st &rof. mtg. bds.
Common stk.

37.5
200.0

Conv. S.F. deb.

19.9

Phillips Petroleum Co.

Conv. deb.

171.8

American Natural Gas Co.

Common s t k .

28.0

Preferred stk.

15.0

Colorado Fuel & Iron Corp.

•Potomac Electric Power Co.




--

25.0
18.0

30.0
26.0
18.0

27.0

January 28
(rights expire)
January 29
January 31
February 6
February 6
February 6
February ll+
February 15
(rights expire)
February 19
February 19
(rights expire)
February 23
(rights expire)
February 25
(rights expire)
February 25,
(rights expire)
February 28

H.1U

F-2
Forthcoming Large Offerings, as of January 25 (Cont'd)
Issuer

Type

Amount
Approximate date
(millions
of offering
of dollars)

CORPORATE (Cont'd)
•Anaconda Co.

Common s t k .

American Tel. & Tel. Co.
Michigan Wisconsin Pipe Line Co.

Deb.

100.0
250.0

1st mtg. bds.

25.O

Port of New York AuthorityRev.
State of .Connecticut
G.O.
Milwaukee Co., Wisconsin
G.O.
San Diego Unified Sch. D i s t . , C a l i f .
G.O.
New York, New York
G.O.
Fresno Unified Sch. D i s t . , C a l i f .
G.O.
Public Housing Authorities
State of Missouri
G.O;.
•Allegheny Go. Sanitary Auth., Pa.
Swr» rev.
San Francisco (City & Co.), C a l i f .
G.O.
• S t . Louis, Missouri
G.O.
El Paso Co. Sch. D i s t . No. 11, Colo.
G.O.
Houston Ind. Sch. D i s t . , Texas
G.O.
Pennsylvania Turnpike Commission
Rev.
Inter-American Center Auth., Fla.
Rev.
New York State Thruivay Authority
G.O.
Jacksonville Expressway Authority
Rev.
Florida State Turnpike Authority
Rev.
Oklahoma Turnpike Authority
Rev.
Expressway rev.
State of Connecticut

50.0
29.2
11.2
5.0
25.2
5.5
28.6
20.0
15.0
23.6
12.1
6.9
16.8
62.0
20.0
50.0
1+2.0
185.0
65.O
54.0

March 5
(rights expire)
March 26
(rights expire)
Winter

STATE AND LOCAL GOVERNMENT
January 29
January 30
February U
February 5
February 5
February 5
February 6
February 13
February 1k
February 18
February 19
February 20
March 1
Winter
Winter
Winter
Winter
Winter
Winter
Winter

OTHER
Qaebec Hydro-Electric Commission

Deb.

35.0

February 7

•—Included in table for f i r s t time.
2 / Includes corporate and other issues of $15 million and over; State and
l o c a l government issues of £5 million and over.
2 f Includes foreign government and International Bank for Reconstruction
and Development i s s u e s .
Note.—Deletions for reasons other than sale of issue: None.




H.lU

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

Date

1952
1953
195k
1955
1956
1956

average
average
average
average
average
- January .
February
March
April
May
June
July 3
18
25
Augpst 1
30
September 11
13
25
October 10
31
November 21
December 6
12

1957 - January 8
16
18

A-rated o f f e r i n g y i e l d s
Aa-rated offering y i e l d s
Amount above
Amount above
Actual
Actual
seasoned y i e l d s
seasoned y i e l d s
(per cent) (basis points) (per cent) (basis points)
3.16
3.U6
3.02
3.23
3.81
None
*3.15
3.28
*3.77
*3.53
*3.52

3
11
Uo
19
18

3.62
3.70

26
33

U.07
-It. 20
It. 17
4.01

52
62
58
37

It. 20
4.30

U8
52

it.30

hi

4.50

62

4.U3

56

h.bo

53

13
16
2
9
35

.
.

3.35
3.78
3.12
3.33
3.73
None
3.23
3.U5
3.61
3.77
*3.75
3.82

J
\

11
26
-3
12
27
-6
15
26
28
27
28

1+.00

it3

U-.U0

63

It.58

70

it. 6 7

70

U.56

57
•

*—Single observation, not an average,
1 / Covers only 30-year f i r s t mortgage bonds, as reported in Moody's Bond
Survey. Except where indicated, the actual 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 offerings during the indicated period, and of
the differences between these new offering y i e l d s and y i e l d s on seasoned i s s u e s
of similar quality for the same day. Average maturity for the seasoned i s s u e s
varies from 26 to 28 years.