Full text of H.16 Capital Market Developments : March 26, 1958

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

Not for Publication DECONTROLLED AFTER SIX MONTHS
H.U* :

'
;

March 26, 1958.

" Ql'PITAL MARKET DEVELOPMENTS

The volume of large public security offerings for new
capital was moderate during the week ending March 21, and is expected to be only slightly larger this week. Corporations sold •
large issues totaling $89 million and State and local governments
offered issues with aggregate proceeds of $61* million. This
week, corporate issues are expected to total $1*0 million and
• State and local government issues totaling $131 million are
scheduled for sale.
Bond yields - Yields increased slightly last week
for.corporate and State and local government bonds, while those
for U. S. Government obligations declined.
A new Aa-rated, first mortgage electric utility bond
issue was offered to investors on March 25 to yield 1*.05 per cent —
5 basis points above that for comparable offerings made last week and the
• week before, and 1*5 basis points above a similar issue in late January.
April security volume estimates - The April volume of
corporate issues for new capital is expected to total $900 million,
two-fifths less than the very large volume in March, but only
slightly smaller than in April of last year. Large public issues
are expected to total over $500 million.
State and local government issues during April are
currently estimated at $700 million. This volume would be about
one-fourth greater than that estimated for March and not much
below the volume in April 1957.
Stock prices - Stock prices, as measured by Standard and
Poor's index of 500 common stocks, increased slightly last week,
closing at 1*2.1*2 on March 21. Prices declined somewhat, on balance,
in the early part of this week, closing at 1*2.30 on Wednesday.
More detailed information concerning recent capital market
developments.is presented in the attached exhibits.
Capital Markets Section,
Division of Research and Statistics,
Board of Governors of the Federal Reserve System.




HIGH-GRADE

,953

B O N D YIELDS

5

Date

,958

,955

Corporate
Aaa 1/

U. S. Govt,
long-term 2/

State and
local govt.
Aaa j /

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

(Per cent)
1953 - High
195k - High
1955 - High
1956 - High
1957 - High
Low
1958 - High
Low
February 21
February 28
March 7
March lit
March 21

3-1*2 (6/19)
3.19 (6/5)
2.99 (1/9)
2.71 (12/31)
3.09 (1/8)
2.71 (1/8)
2.85 (U/23)
2.U5 (8/6)
3.17 (12/23) 2.97 (8/5)
2.91 (1/7)
2.6U (1/7)
3.79 (12/28) 3.1*5 (12/28)
3.07 (3/2)
. 2.814 (2/17)
li.lli (9/27)
3.76 (10/18)
3.66 (h/12)3.18 (2/8)
3.68 (1/3)
3.28 (1/31)
3.20 (1/10)
3.56 (1/31)
. 3.58
3.60
3.62
3.62
3.63

3.25
3.27
3.27
3.27
3.2b

2.73 (6/25)
1.98 (1/8)
2.21 (6/10)
1.90 (9/2)
2.3U (9/8)
2.05 (5/26)
3.05 (12/27)
2.17 (2/23)
3.U5 (8/29)
2.76 (2/21)
2.86 (1/9)
2.65 (1/23)

.38
.20
.143
.30
.27
.11
.141
.12
.60
.27
.I46
.28

*83
.33
.62
.30
.76
.57
.71
.32.
.U7
.15
.62
.3lt

2.73
2.76
2.78
2.78
2.79

.33
.33
• 35
.35 '
.39

.52
.51
.149
.1*9

.h5

1/ Weekly average of daily figures. Average terra of bonds included is 25-26 years.
2/ Weekly average of daily figures. The series includes bonds due or callable in
10 years or more.
"
2/ Thursday figures. Only general obligations bonds are included; average term is
20 years.
Note.—Highs and lows are for individual series and may be on different dates for
different series.




LOWER-GRADE

BOND

YIELDS

LOCAL GOVT. Bo,

:

Corporate
Baa 1/

State and
local govt.
Baa 2/

3.89 (9/18)
3.50 (1/2)
3.7k (1/8)
3 . a (12/31)
3.63 (12/30)
3.15 (1/lit)
lt.ltl (12/28)
3.58 (3/9)
5.10 (11/29)
lt.U2 (lt/12)
L 9 6 (1/3)
lt.61t (2/21)

3.79 (6/25)
2.96 (1/8)
. 3.32 (1/7)
2.93 (8/5)
3.26 (12/29)
3.02 (1/6)
it.22 (12/27)
3.20 (3/3)
lt.5l (8/29)
3.90 (2/21)
3.92 (1/2)
3.73 (1/23)

Date

Spread between
Aaa and Baa
[State and
|local govt.

Corporate

(Per cent)
1953 - High
195U - High
' Low
1955 - High
1956 - High
1957 - High
1958 - High
Low
February 21
February 28
March 7
March Ik
March 21

U.64
It. 65
It. 66
It. 67
^ It.68

3.78
3.85
3.85
3.86
3.89

.69
.lt2
.68
.52
.5U
.45
.63
.U2
1.27
.61t
1.28
l.Olt

1.21
.98
1.16
.93
1.03
.87
1.17
.89
1.21
l.Olt
1.10
1.02

1.06
1.05
l.Olt
1.05
1.05

1.05
1.09
1.07
1.08
1.10

1/ Weekly average of daily figures. Average term of bonds includes is
25-26 years.
2/ Thursday figures. Only general obligation bonds are included; average
term is 20 years.
Note.—Highs and lows are for individual series and may be on different
dates for different series.




STOCK. M A R K E T

Date

Stock price
index 1/

Common
Trading
Stock market custi
Customers'
volume 2/
debit bal- loans to
(millions yields 3/
of sliarea) (per cunt)
ances U/ "others" 5/
(Millions of dollars)

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

26.51 (1/2)
22.95 (9/18)
35.9A (12/31)>
24.93 (1/8)
1,5.6° (12/9)
35.28 (1/lit)

6.25
5.38
5.82
32

2.5
0.9
3.7
l-U
1*.6
1.5
1*9.6b (8/3
)
3.1
1*3.22 (1/20)
1.5
1,9.08 (7/12)
1*.2
39.U8 (12/20) . 1.1,
1,2.142 (3/21)
2.5
10.37 (1/10) "1.7

3.61
I*. 35
3.82
1<.72
3.91
1,.58.
l*-33\

ia.12
Ul. 26
1,2.07
12.33
1,2.1,2

1,-1,8
J».l*9
1,.38
1,-314
14.33

2". 3
2.0
2.1
2.1,
2.3

2,1,55
2,055
3,1,36
2,1,05
14,030
3,537
l,,0l,7
3,911,
4,031
3,576
3,679
3,551*

1,665
1,3114
2,388
1,653
2,805
2,517
2,823
2,740
2,887
2,482
2,580
2,1*87

3,554
3,679

2,14*7
2,580
n.a.

n.a.

780
661*
1,0148
•71*6
1,21*1
1,018
1,267
1,155
1,163
1,051*
1,110
1,051 .
1^099
1,110
1,106

i.—Not available.
1/ Standard and Poor's composite index of 500 common stocks, weekly closing
prices, 19l»l-li3"10. Monthly data are averages of daily figures rather than of
Fridays' only. Highs and lows are for Fridaj's data only.
2/ Averages of daily trading volume on the New York Stock Exchange.
2/ Standard and Poor's composite stock yield based on.Wednesday data converted to weekly closing prices by Federal Reserve.
h/ End of month figures for member firms of the New York Stock Exchange which
carry margin accounts; excludes balances secured by U. S. Government obligations.
5/ 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 renorting hanks account for about 70 per cent of loans to others.
For further detail see Bulletin."
Note.—Highs and lows are for individual series and may be on different dates
for different series.




Exhibit D
Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)

1958
January
February
March
April
May
June

e/ 800

e/ 900

quarter
quarter
quarter
quarter

92ft
771
1,1*89

818
1,11*6
81*1 •

1,055
792
1,086
e/ 3,175

1st half
Three quarters
Year

1956
573
712
817

991
91b
973

October
November
December

New capital

1,063

e/ 1,5002/

July
August
September

1st
2nd
3rd
lith

Corporate
1
1 1957

.

State and local 1/
1
195?
1
195b

810
91*!*
e/550

71*2
572
506

hok

e/700

765
51*6
393

378
1*90
735

*•8

529
581*
1*31

1*08
206
357

71*5 .
1,089 3/
1,088
.

698
633
698

639
31*7
1*09

1,820
1,701*
1,51*1*
2,029

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

3,521*
5,069
7,099

3,093
1*,06U
5,1*59

838

3,1*79
3,181* .
2,878
2,933
6,662
9,51*0
12,1*73

- 1958

2,102
2,805
2,556
2,922
1,907
7,1*63
10,381*

e/2,30l*
.

696
390

Excluding finance companies b j
1st
2nd
3rd
Uth

quarter
quarter
quarter
quarter

e/ 2,875

Year

3,268
2,921* •
2,560
2,788
il,5Uo

1,61*7
2,Z
2,826
9,260

e/ Estimated.
1/ Data through June 1956 are Bond Buyer data classified as new capital by
Federal Reserve; later data^ are from the. Investment Bankers Association of America
and are somewhat more complete as to coverage than the earlier data, particularly
for Federal Government loans.
2/ Includes $718.3 million AT&T convertible debenture issue.
3/ Includes 0671.5 million AT&T common stock issue.
•
5/ Total new capital issues excluding offerings of sales and consumer finance
companies.
•
Note.—Details may not add to totals due to rounding-.




V
H.llt

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

306
19k
k99
21*8
176
265
357
185
135
386
139#6
6#

671
788

1957 - February
March
April
May
|
June
July
August
September
October
November
December
1958 - January
February

Other 2/

U77

329
877
525
526
537
57k
k20 •
3#
318
605
.

50

_

125
25
39
25
30
75
215
15

Large Individual Issues Offered March 1 through 21

Issuer

Type 3/

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

CORPORATE
Baltimore Gas & Elec. Co. lst&ref.mtg.bds.30.0
1st mtg.bds. kO.O
Ohio Edison Co.
Union Electric Co.
1st mtg.bds. 35.0
Columbia Gas System, Inc.
Deb.
30.0
Pub. Service Elec. & Gas
Pfd. stk.
25.0
I
"
S.F.
deb.
20.0
Sylvania Elec. ProductsJhe,
Sylvania Elec. ProductsJhc Conv. sub. deb.20.0
Conv. deb. 718.3
American Tel. & Tel. Co.
Deb.
30.0
Miss. River Fuel Corp.
1st mtg. bds. 16.0
Chi.,Rock Is. & Pacific RR
1st mtg. bds. 20.0
Carolina Pwr. & Lt. Co.
Pfd. stk.
20.0
Tenn. Gas Trans. Co.
1st mtg. bds. 25.0
Texas Eastern Trans. Co.
1st mtg. bds. 2k. 0
Georgia Power Co.




1993
1988
1988
1983

k
k l/k
k 3/8
k 3/8

3.9k
k.15
U.22
k.ko

Aa'
Aa
A

1980
1983
1973
1978
1983
1988

k3/k
k 1/2
111A
k 3/k
5 1/2
k 1/8

k-75
k.5o
a. 25
k.71
5.50
ii.00

Baa
Ba
Aa
Baa
Baa
Aa

1978
1988

k 7/8
k 1/8

U.92
k.07

Baa
A

H.lU

E-2
Large Individual Issues Offered March 1 through 21 (Cont'd)

Type 3/

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

STATE AND LOCAL GOVERNMENT
^"Seattle, Washington
Rev.-Ut.
20.0
Miami, Florida
G.O.
12.7
State of Mississippi
G.O.
20.0
Harrisburg Swge. Auth.,Pa, Rev.-Rent.
7.2
Newark, New Jersey
G.O. -/
15.0
Cuyahoga Co., Ohio
G.O.
5.3
Milwaukee, Wisconsin
Rev.-Ut.
10.0
Lafayette, Louisiana
Rev.-Ut.
8.0
St. Paul, Minnesota
G.O.
5.U
State of West Virginia
Rev.-S.T.
8.7
State of Ohio
Rev. —S. T. 32.0
6.1
. Indiana University
Rev.-Q.ut.
OTHER

1960-88/68
1960-88
1959-73
1961-83/63
1959-78
1959-73
1959-86/68
1960-87/63
1959-88
1959-68
1958-72
1960-87

3.63
3.11
2.68
3.01
3.09
2.55
3.12
lt.13
2.93
2.38
2.56

1.75-3.75
1.80-1:. 25, /
1.10-2.85='
1.70-3.50
1.30-3.35
1.10-2.85
1.25-3.25c/
2.1|0-U.20^
1.10-3.00
1.10-2.60 .
1.00-2.80
n.a.

A'
A
Aa
Aa
A
Aa
Aa
Baa
Aa
A
Aa

n.a.—Not available.
. 1/ Includes corporate and other security offerings of #15 million and oyer;
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
obligations; Rev.-Ut., revenue obligations secured only, by income from public
utilities; Rev.-Q.Ut., revenue bonds secured by revenue of quasi-utilities;
Rev.-S.T., revenue bonds secured by revenue from specific taxes only; Rev.-Rent.,
revenue bonds secured solely by lease payments.
h/ 1972-73 maturities not reoffered.
5/ 1987 maturity not reoffered.




H.lii

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

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

During month following
date shown
State and
Corporate local govt. Other 2/
740
461
187
525
370
526
578
576
458
383
378
498
1,123

153
290
179
97
172
252
243
370
369
3#
383
129
175

——

25
25
25
30
30
18
150
—

Subsequent to
date shown
State and
Corporate
local govt.
795
486
258
#5
415
811
845
647
• 815
1,193
1,161
1,378
1,208

^

631
862
396
388
498
. 514
4#
587
,573
589
614
546. .
389

Other 2/
——

25
25
25
30
15

bB

63
165
—

Forthcoming Large Offerings, as of March 21
Type

Amount
Approximate date
(millions
of offering
of dollars)

1st mtg. bds.
Florida Power & Light Co.
1st mtg. bds.
General Telephone Co. of California
Wisconsin Electric Power Co.
1st nrtg. bds.
General American Transportation Co. Equip.' tr. cert.
General Telephone Corp.
Common stk.
S. F. deb.
Pacific Petroleum Ltd.
Duquesne Light Co.
1st mtg. bds.
-Joseph E. Seagram & Sons, Inc.
Deb.
Aluminum Co. of America
Deb.
•Conv. sub. deb.
Richfield Oil Corp.
Commonwealth Edison Co.
Mississippi Power & Light Co.
Consolidated Edison Co. of New York
American Can Co.
Douglas Aircraft Co.




1st mtg. bds.
1st mtg. bds.
1st ref. mtg. bds.
Deb.
S. F. deb.

. 20.0
20.0
30.0
20.0
20.0
30.0
15.0
4o.o
125.0
19;0
5o.o
15.0
50.0
40.0
60.0

Mar. 2-5
Mar. 27 .
Apr. 1
Apr. 3 '
Apr. 3
Apr. 3
Apr. 10
Apr. 10
Apr. 11
Apr. 14
(rights expire)
Apr. 16
Apr. 17
Apr. 23
Apr.
Apr.

H.lU

F-2
Forthcoming Large Offerings, as of March 21 (Cont'd)
Type

Amount
Approximate date
(millions
of offering
of dollars)

CORPORATE (Continued)
Commerce Oil Refining Corp.
Natural Gas Pipeline Co. of America
Tennessee Gas Transmission Co.

Deb.,bds. & common
1st mtg. bds.
Deb.

U5.0
I4.O.O
30.0

1958
1958
1958

12.5 '
1:9.5
7.3
8.1
6.7
2Uo7
5.0
7.0
10.6
12.5
18.3
13.5
7.0
8.U
5.0
7.5
2L6
96.9
7.5
100.0

Mar. 25
Mar. 25
Mar. 26
Mar. 26
.Mar. 26
Mar. 27
Mar. 27
Mar. 27
Mar. 27
Apr. 1
Apr. 1
Apr. 2
Apr. 2
Apr. 3
Apr. 8
Apr. 9
Apr. 9
Apr. 16
. Apr. 17
Apr. 23

STATE-AND LOCAL GOVERNMENT
Orlando Utilities Comm., Fla.
State of New York
Hoboken, New Jersey
State of Louisiana
Providence, Rhode Island
State of Iowa
Fort Worth Ind. Sch. Dist., Texas
Harris Co., Texas
^Buffalo, New York
*Texas Veterans Land Board
-^Commonwealth of Puerto Rico
*Los Angeles, California
Lafayette Par. Sch. Dist. No. 1, La.
Tampa, Florida
•sArme Arundel Co., Maryland
^-Chicago, Illinois
State of Maryland
State of Massachusetts
Louisiana State University
State of California

Rev.-Ut.
G.O.
Rev.-Ut.
G.O.
G.O.
G.O.
-G.O.
G.O.
G.O.
G.O.
G.O.
Rev.-Ut.
G.O.
Rev„-Ut.
G.O.
G.O.
G.O.
G.O.
Ut.-Q.Ut. G.O.

OTHER
Ontario, Canada
Ext.. deb.
Apr. 2
75.0
Apr. h
20.0
Ext. deb.
^Edmonton, Alberta, Canada
Included in table for first ti
1/ Includes"corporate and other issues of $15 million and over3 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 than sale of issue: None.




H.lii

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

Date

1952 - 1956
High
Low
1957 - January
February
March
April
May
July
August
September
October
November
December
1958 - January 8
9
17
21
23.
February 5
IV
20
21 .
25
26
28
March h
5
6
12
19
21

Aa-rated offering yields A-rated offering yields
Amount above
Amount above
Actual
Actual
(per cent) seasoned yields (per cent) seasoned yields
(basis points)
(basis points)

h.30(12/12/56)
2.93(3/31/51) :

62
-3

k.hk
h.2 5

57
a.

None
*U.29

k.hk

1.71
. 1^.66
*5.oo
a. 83
*L78 .
U.79E/
*a.3o

50
58
81
57
. 75

$k

U5
U9

Ik

3.60

-8

3.80
.3.80

13
12

3.95
Loo

28
33

li.15
k.22
a. 00
1.00

a
50
28
26

h.58(12/6/56)
3.00(3/17/5U)
1.62
None
li.50
L.55
U.80
^.10. .
L,86E/
None
*5.10
5.08 ,
5.282/
-x-ii.UO

70
-15
6U

hS
Sh

79
106
70
51

k6
66

k

3.85
3.80

9
13
-3
-8

3.90

-3

3.92

-3

i.ko
•U.25

35
6

U.07

— 1

*—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.
2/ Providesfor a 5-year period during which issue may not be called for
refunding at a lower coupon rate. Monthly averages so marked include one or.more
issues with such a provision. Other averages and issues have no such provision.