Full text of H.16 Capital Market Developments : March 12, 1958

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Mot f o r Publication

AFTER SIX MONTHS

H.lli

March 12, 1958
CAPITAL MARKET DEVELOPMENTS

Large p u b l i c 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 d u r i n g t h e
week ending March 7, t o t a l e d *160 m i l l i o n 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 and l o c a l governments„ The c a l e n d a r f o r t l i i s week
i n d i c a t e s a small volume of u n d e r w r i t t e n i s s u e s , b u t i n c l u d e s t h e AT&T
$718 m i l l i o n d e b e n t u r e i s s u e f o r which s u b s c r i p t i o n r i g h t s e x p i r e on
Wednesday. Other c o r p o r a t e i s s u e s a r e expected t o t o t a l $86 m i l l i o n
and two S t a t e and l o c a l government i s s u e s with a g g r e g a t e proceeds f o r
#20 m i l l i o n a r e scheduled f o r s a l e . Another c o r p o r a t e i s s u e o r i g i n a l l y
scheduled f o r s a l e t h i s week — a $20 m i l l i o n f i r s t mortgage bond i s s u e
by General Telephone Company of C a l i f o r n i a — was postponed because of
market c o n d i t i o n s .
Bond y i e l d s - Y i e l d s on c o r p o r a t e and n i g h - g r a d e S t a t e and
l o c a l government bonds i n c r e a s e d l a s t week, w h i l e those f o r U„ S= Government and B a a - r a t e d S t a t e and l o c a l government o b l i g a t i o n s remained s t a b l e „
Y i e l d s on new c o r p o r a t e i s s u e s have d e c l i n e d somewhat r e c e n t l y
although they a r e s t i l l above y i e l d s on i s s u e s o f f e r e d i n January and
e a r l y February, A new A a - r a t e d , f i r s t mortgage e l e c t r i c u t i l i t y bond
i s s u e was o f f e r e d t o t h e p u b l i c on Wednesday, March 12, t o y i e l d In00
p e r c e n t a s compared t o y i e l d s of l u l 5 p e r c e n t and h°22 p e r cent f o r
comparable o f f e r i n g s made l a s t week.
Stock p r i c e s - Stock p r i c e s , a s measured by t h e Standard and
P o o r ' s index of 500 common s t o c k s , i n c r e a s e d 3 p e r cent l a s t week, c l o s i n g a t 1*2.07 on March 7* Trading a c t i v i t y picked up, a v e r a g i n g 2 . 1 m i l l i o n s h a r e s a day. P r i c e s , on b a l a n c e , i n c r e a s e d f u r t h e r during the
e a r l y p a r t of t h i s week, c l o s i n g a t U2«,Ul on Wednesday,
More d e t a i l e d i n f o r m a t i o n concerning r e c e n t c a p i t a l market
developments i s p r e s e n t e d i n t h e a t t a c h e d e x h i b i t s .

Capital harkets Section,
D i v i s i o n of Research and S t a t i s t i c s /
Board of Governors of t h e F e d e ra l Reserve System-




HIGH-GRADE BOND YIELDS

"53

,954

5

Corporate

Date

1955

U. S. Govt,
long-term 2/

1956

1957

State and
local govt.
Aaa y

1958

Spread between
U. S. Govt, and
Corporate 1[State and
Aaa
|I local Aaa

(Per cent)
3.1*2 (6/19)
2.99 (1/9)
3.09 (1/8)
2.85 (i*/23)
3.17 (12/23)
2.91 (1/7)
3.79 (12/28)
3.07 (3/2)
U.lU (9/27)
3.66 (V12)
3.68 (1/3)
3.56 (1/31)

-19*3 - High
1951* - High
1955 - High
1956 - High
1957 - High
1958 - High
Low
February
Februaxy
February
February
March 7

7
lU
21
28

1

3.59
3.59
3.58
3.60
3.62

3.19 (6/5)
2.7k (12/31)
2.7U (1/8)
2.1*5 (8/6)
2.97 (8/5)
2.6U (1/7)
3.U5.(12/28)
2.8!* (2/17)
3.76 (10/18)
3.18 (2/8)
3.28 (1/31)
3.20 (1/10)
3.27
. 3.2U
3.25 .
3.27
3.27

2.73 (6/25)
1.98 (1/8)
2.21.(6/10)
1.90 ( 9 / 2 r
2.31* (9/8)
2.05 (5/26)
3.05 (12/27)
2.17 (2/23)
3.1*5 (8/29)
2.76 (2/21)
2.86(1/9)
2.65 (1/23)

.38
.20
• U3
.30
.27
.11
.a
.12
.60
.27
.1*6
.28

.83
.33
.62
.30
.76
.57
.71
.32
.1*7
.15
.62
• 3U

2.70
2.70
2.73
2.76
2.78

.32
.35
.33
.33
.35

.57
.51*
.52
.51
•U9

.
.

1/ Weekly average of daily figures. Average term of bonds included i s 25-26 years.
2/ Weekly average of daily figures. The series includes bonds due or callable in
10 years or more.
J/ Thursday figures. Only general obligation bonds are included; average term i s
20 years.
Note -Highs and lows are for individual series and ray be on different.dates for
different series.
-




LOWER - GRADE BOND YIELDS

/

,RA1

k Jy
\

/>
/

/

1

J

V

t

1953

*V'

V
V •<-y
1954

r
f
'\

r

i

Vu/

L°CJ k

-

Corporate
Baa 1 /

1956

State and
local govt.
Baa 2/

1957

1958

Spread between
Aaa and Baa
Corporate I State and
1local govt.

(Per cent)
1953 - High
Low
195fc - High
Low
1955 - High
1956 - High
1957 - High
Low
1958 - High
Low
February
February
February
February
March 7

7
lb
21
28

3.89 (9/18)
3.50 (1/2)
3.7U (1/8)
3 . ^ (12/31)
3.63 (12/30)
3.15 (1/lii)
U.Ul (12/28)
3.58 (3/9)
5.10 (11/29)
h.Uz (it/12)
U.96 (1/3)
U.61t (2/21)

3.79
2.96
3.32
2.93
3.26
3.02
li.22
3.20
U.51
3.90
3.92
3.73

U.68
14.66

3.77
3.77
3.78
3.85
3.85

U.65
U.67

(6/25)
(1/8)
(1/7)
(8/5)
(12/29)
(1/6)
(12/27)
(3/8)
(8/29)
(2/21)
(1/2)
(1/23)

.69
.U2
.68
.52
•5U
•U5
.63
.42
1.27
.64
1.28
1.05

1.21
.98
1.16
.93
1.03
.87
1.17
.89
1.21
1.0U
1.09
1.02

1.09
1.07
1.06
1.05
1.05

1.07
1.07
1.05
1.09
1.07

1 / Weekly average of daily figures. Average term of bonds includes i s
25-2o years.
2/ Thursday figures. Only general obligation bonds are includedj average
term i s 20 years.
Note.—Highs and lows are for individual series and may be on different
dates f o r different series. °




-

• "

-V

1955

Date

L

i

f\

STOCK MARKET

STOCK MARKET

Date

Stock p r i c e
index 1 /

volume 2 /
(millions
yields j /
of s h a r e s ) ( p e r c e n t )

Stock market c u s t smer c r e d i t
Customers'
debit balances ft/ - o t h e r s " 5 /
( M i l l i o n s of d o l l a r s )

1953 - High
Low
195U - High
Low
1955 - High
1956 - High
1957 - High
Low
1958 - High
January
February
February 21
February 28
March 7

26.5k
22.95
35.98
2L.93
U5.69
35.28
1*9.61*
1*3.22
1*9.08
39.1*8
1*2.07
1*0.37
1*1.12
1*1.26
1*0.81*
1*2.07

(1/2)
(9/18)
(12/31)
(1/8)
(12/9)
(1/11*)
(8/3)
(1/20)
(7/12)
(12/20) .
(3/7)
(1/10)

2.5
0.9
3.7
1.1*
It.6
1.5
3.1
1.5
1*.2
l.k
2.5
1.7

6.25
5.38.
5.82
It. 32
It • 1*23.6lt
It. 35
3.82
It.72
3.91
• It.58
It.38

2.3
2.0

lt.lt8
It.It9
lt.52
It. 53
lt.38

2,1*55
2,055
3,1*36
2,1*05 It,030
3,537
lt,0lt7
3,9Ht
U,031
3,576
n.a.
.

1,665
l,3Ht
2,388
1,653
2,805
2,517
2,823
2,7lt0
2,887
2,lt82

-

780
661*
1,01*8
•7lt6
l,2ltl
1,018
1,267
1,155
1,1631,051*

n.a.

',051

3.55U

2,1*87

n.a.

n.a.

.,067
1,099
1,092
1,099
n.a.

u.tle —nuu tlVax-LaU-LC.
.
1 / Standard and P o o r ' s composite index of 500 common s t o c k s , weekly c l o s i n g
p r i c e s , 19Ul-li3"10. Monthly d a t a a r e a v e r a g e s of d a i l y f i g u r e s r a t h e r t h a n of
F r i d a y s ' o n l y . Highs and lows a r e f o r F r i d a y ' s d a t a o n l y .
2 / Averages of d a i l y t r a d i n g volume on t h e New York Stock Exchange.
Standard and P o o r ' s composite s t o c k y i e l d based on Wednesday d a t a c o n v e r t e d t o weekly c l o s i n g p r i c e s by F e d e r a l R e s e r v e .
h / End of month f i g u r e s f o r member f i r m s of t h e Hew 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 .
5 / Wednesday f i g u r e s f o r weekly r e p o r t i n g member banks. Excludes l o a n s f o r
p u r c h a s i n g o r c a r i y l n g U. S. Government s e c u r i t i e s . a t banks i n New York and
Chicago. Weekly r e p o r t i n g banks account f o r about 70 p e r c e n t of l o a n s t o o t h e r s .
For f u r t h e r d e t a i l s e e B u l l e t i n .
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 State and Local Government
Security Offerings and Placements
(In millions of dollars)

1958
January
February
March

e/ 800
e / 875 /
e/ 1,500!/

April
May
June
July
August
September

1st
2nd
3rd
Uth

quarter
quarter
quarter
quarter

2/ 3,175'

1st half
Three quarters
Year

1956

1958

State and local 1/
1 195? 1 195b
71*2
572
506

1*01*

818
.1,11*6
81*1

765
51*6
393

378
1*90
735

l

- S
838

529
581*
1*31

1*08
206
357

1,055
792
1,086

71*5
1,089 3/
1,088

633

698

639
31*7
1*09

3,1*79
3,18k
2,878
2,933

2,102
2,805
2,556
2,922

6,662
9,51*0
12,U73

7A63
10,381

1,063
1,071
1.3UU

573
712
817

921*
771
1,1*89
991
91U
973

October
November
December

New capital

Corporate
1
1 1957

810
9W*
e/550

698

e/2,30h

696

390

1,820
1,70k
1,51*1*.
2,029

1,1*90
1,603
971
1,395

3,521*
5,069
7,099

3,093
1*,061*
5,1*59

Excluding finance companies hj
1st
2nd
3rd
Uth

quarter
quarter
quarter
quarter

e / 2,875

3,268
2,921*
2,560
2,788

n,5to

Year

2,5U1
2,216
. 2,826 r9,260.

9/ Estimated.
"
- ~
l / Data through June 1956 are Bond Buyer data c l a s s i f i e d as new capital by
Federal Reserve; l a t e r data are from the Investment Bankers Association of America
and a re-, somewhat more complete as to coverage than the e a r l i e r data, particularly
f o r Federal Government loans.
2/ Includes $716.3 million AT&T convertible debenture issue.
X/ Includes $371.5 million AT&T common stock issue.

0/ 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 t o rounding.




H.lii

Exhibit E
Large Public Security Issues f o r New Capital
(Other than U. S. Treasury) 1/
Proceeds of Large Issues Offered
(Millions o'' dollars)
Month

Corporate

1957 - February
March
.
/Pril
May
June
July
August
September
October
November December
1958 - January
February

.

State and
local government

671
788
hn
32 9
877*
525
#6
537,
57k
1*20 .
399
318
605

Other 2/

306
19U
1*99
2li8
176
265
357
185
U35
386
1*39
506
629

50
125
25
39
25
30
75
21#
15

Large Individual Issues Offered March 1 through 7
Issuer

Type 3/

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

CORPORATE'
Baltimore Gas & Elec. Co.
Ohio Edison Co.
Union Electric Co.
Columbia Gas System, Inc.
Pub. Service Elec. & Gas

lst&ref.mtg.bds.30.0
1st mtg.bds. ItO.O
1st mtg.bds. 35.0
Deb.
30.0
Pfd. stk.
25.0

1993
1988
1988
1993

U
h 1A
1: 3/8
L3/8

3-9U
U.15
li.22
h.ho

Aaa
Aa-

Aa
A

STATE AND LOCAL GOVERNMENT
Seattle, Washington
Miami, Florida'
State of Mississippi
Harrisburg Swge. Auth.,Pa.
OTHER
None




Elec. rev.
G.O.
G.O.
Rev.

20.0 1960-88/68
12.7. 1960-88
20.0 1959-73
7.2 1961-83/63

3.63
3.11
2.68
3-01

1.75-3*75
1.80-1.25, y,
1.10-2.852/
1.70-3.50

A
A

Aa
Aa '

E-2
n.a.—Not available.
1/ Includes corporate and other security offerings of >15 million and over;
State and local government security offerings of $5 million and over.
2/ Includes foreign government and International Bank f o r Reconstruction and
Development issues.
3/ In the,case of State and local government s e c u r i t i e s , G.O. denotes general
obligations; 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.
h/ 1972-73 maturities not reoffered.




H.lU

Exhibit I
forthcoming Large Public Security Offerings for New-Capital
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues

Date of
computation
1957 - Feb. 28
Mar, 29 "
. Apr. 30
May 31
June 28
July 31
Aug. 30
Sept. 30
Oct. 31
Nov. 29
Dec. 31
1958 - Jan. 31
Feb. 28

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

During month following
date shown
State and
Corporate local govt. Other 2/
7U0
i*6i
187
525
370
526
578
576
1*58
383
378
1*98
1,123

153
290
179
97 .
172
252
2l*3
370
369
387
383
1*29
175

25
25

.

25
30
30
18
150
—

795
1*86
258
525
415
811
8L5
61*7
.815
1,193
1,161 .
1,378
1,208

631
862
396
388
1*98
511*
1*39
587
573
589
611;
51*6
3#

—

25
.25
25
30
15
1*5
63
165
—

Forthcoming Large Offerings, as of March 7
Type

/

.

Amount
(millions
of d o l l a r s )

Approximate d a t e
of o f f e r i n g

. CORPORATE

Sylvania Electric Products, Inc.
Sylvania Electric Products, Inc.
American Telephone & Telegraph Co.
Mississippi - River Fuel Corp.
Chicago, Rock Island & Pacific R.R.
Carolina Power and Light Co.
' Tennessee Gas Transmission Co.
Tennessee Gas Transmission Co.
Texas Eastern Transmission Corp.
Georgia Power Co.
Florida Power & Light Co.
Wisconsin Electric Power Co.
^Richfield Oil Corp.




S.F. deb.
Conv. sub. deb.
Conv. deb.
S . F . deb.
1st mtg. bds.
1st mtg. bds. .
Deb.
Pfd. stk.
1st mtg. bds.
1st mtg. bds.
1st mtg. bds.
1st mtg. bds.

Conv. sub. d e b .

20.0
20.0
718.3
30.0
16.0
20.0
30.0
20.0
25.0
2l*.0
20.0
30.0
19.0

: Mar. 11
Mar. 11
Mar. 12
(rights expire)
Mar. 12
Mar. 13
Mar. 18
Mar. 19
Mar. 19
Mar. 20
Mar. 21
Mar. 25
Apr. 1
Apr. lit

( r i g h t s expire)

H.lU

-

F-2

Forthcoming Large Offerings, as of March 7 (Cont'd)
Type

Amount
date
(millions Approximate
of offering
of dollars)

CORPORATE (Continued)
-^-Mississippi Power & Light Co.
1st mtg. bds.
^Consolidated Edison Co; of New York 1st r e f . mtg. bds.
Commerce Oil Refining Corp.
Deb., bds. &common
Natural Gas Pipeline Co. of America 1st mtg.. bds.
General Telephone Co. of Calif.
1st mtg. bds.

15.0
50.0
1*5.0
1*0.0
20,0

Apr • 17
Apr . 23
1958
1958
1958

STATE AND LOCAL GOVERNMENT
Newark, New JerseyG.O.
Cuyahoga Co., Ohio
G.O.
Milwaukee, Wisconsin
Wtr. rev.
Lafayette, Louisiana
Util. rev.
St. Pajil, Minnesota
G.O.
->State of West Virginia
G.O.
State of Ohio
Rev.
Orlando U t i l i t i e s Comm., Fla.
Wtr. & e l . rev.
State of Louisiana
G.O.
Providence, Rhode Island
G.O.
State of Iowa
G.O.
Lafayette Par. Sch. Dist. No. 1, La.
G.O.
Louisiana State University
Bldg. rev.
State of California
G.O.
Pennsylvania Turnpike Commission
Rev.
Inter-American Center Authority,Fla.
Rev.
Met. Fair & Exposition Auth., 111.
Bldg. rev.

15.0
5.3
10.0
8.0
S.h
8.7
32.0
12.5
8.1
6.7
21.7
7.0
7.5
100.0
62.0
20.0
25.0

Mar. 11
Mar. 13
Mar. 18
'Mar. 18
Mar. 19
Mar. 19
Mar. 20
Mar. 25
Mar. 26
Mar. 26
Mar. 27
Apr. 2
Apr. 17
Apr. 23
1958
1958
1958

.

OTHER
None
*—Included in table for f i r s t t ime.
1/ Includes corporate and other issues of $15 million and over; State and
local government issues of $5 million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues.
Note.—Deletions f o r reasons other than sale of issue: None.




v
H.llt

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

1952 - 1956
High
Low
1957 - January
February
March
April
May'
June
July
. August
September
October
November
December
1958 - January 8
9
17
21
23
February 5
lit
20
21
25
26
28
March It
5
6

Aa-rated offering yields A-rated offering yields
Amount above
Amount above
Actual
Actual
(per cenb) seasoned yields (per cent) seasoned yields
(basis points)
(basis points)
it. 30(12/12/'56)
2.93(3/3lM)

62

h.kh
it. 25
None
*4.29
it. itit
1.71
it. 66
*5.00
it. 83
*it.78_ ,
it. 7 92
*it.30

57
itit

-3

50
58
81
57
75
5it
it5
lt9
lit

it. 58(12/6/!>6)
3.00(3/l7/5U)
it. 62 .
None
it. 50
it.55
it. 80
*5.10 .
it.862/
None
*5.10
5.08 ,
5.282/
*it.it0

{:>
3.60

-8

3.80
3.80

13
12

3.95
it. 00

28
33

it.15
it.22 •

itit
50..

70
-15
6it
it5
5it
79
106
70
51
it6
66
it

3.85
3.80

9
13
-3
-8

3.90

-3

3.92

-3

it.itO
it. 25

35
6

*—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 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 f o r the seasoned issues varies
from 26 to 28 years.
2/ Providesfor a 5-year period during which issue may not be called f o r .
refunding at a lower coupon r a t e . Monthly averages so marked include one or more
issues with such a provision. Other averr^es and issues have no such provision.