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'Mot for Publication

DECOmoLL®

•H.llt

APIB, six m

-TSS
September 15, 1958.

CAPITAL MARKET DEVELOPMENTS
The volume of new public security financing was large last
week, particularly for corporate securities, and is expected to be
only slightly smaller this week. Large public security offerings for
new capital during the week ending September 12 totaled, §385 million
for corporations, including a $350 million debenture issue of Sears,
Roebuck and Company (which was quickly sold), and #60 million for
State and local governments. The calendar for this week includes
corporate offerings amounting to $250 million and State and local
government issues totaling $110 million.
types
U; S.
while
bonds

Bond yields - Yields advanced further last week for all
of outstanding bonds. Yields for high-grade corporate and
Government bonds are now only slightly below their 1957 highs,
those for State and local government and lower-grade corporate
are l t to 2 t basis points below those levels.
i
l

Stock prices - Common stock prices continued to increase
last week. Standard and Poor's index of 500 common stocks reached
new highs for the year, closing at U8.53 on September 12. Trading
activity also increased substantially last week with daily volume
averaging 3.3 million shares.
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.




H I G H - G R A D E B O N D YIELDS




CORPORATE

AGO

STATE A N D LOCAL
G O V E R N M E N T AOO

CORPORATE

!\ax'

BOO

D LOCAL

GOVT.

BAA.

H.Ik

Exhibit B
Tables for Exhibit A
High-grade Bond Yields
Spread between
U. S. Govt, and
Corporate State and
Aaa
local Aaa

State and
local govt.
Aaa y

Corporate
Aaa 1/

U. S. Govt,
long-term 2/

High
Low
high
High
Low

3.1*2
2.85
it.lU
1|.07
3.55

3.19 (6/5)
2.it5 (8/6)
3.76 (10/18)
3.75 (9/12)
3.07 (it/25)

2.73
1.90
3.W
3.31
2.6U

Aug. 15
Aug. 22
Aug. 29 .
Sept. 5
Sept. 12 2/

3.83
3.89
3.9k
it.03
i . 07
t

3.61
3.62
3.67
3.72
3.75

3.0U
3.12
3.22
3.29
3.31

Date

(Per cent)
1953
195U
1957
1958

-

(6/19)
(it/23)
(9/27)
(9/12)
(S/2)

(6/25)
(9/2)
(8/29)
(9/11)
(5A)

.38
.30
.60
.51
.22

.83
.30
.*
17
.62
• 3t
i-

.22
.27
.27
.31
.32

.57
.50
.h 5
.h3
.tt
ii

,

Lower-grade Bond Yields
Spread between
Aaa and Baa
State and
Corporate
local govt.

State and
local govt.
Baa y

Date

Corporate
Baa 1/

High
Low
High
High
Low

3.89 (9/18)
3 i i (12/31)
.tt
5.10 (11/29)
it.96 (1/3)
i . 51 (7/11)
t

3.79 (6/25)
2.93 (8/5)
it.51 (8/29)
i . i (9/11)
t3t
3.6it (5/1)

i . 66
t
it.71
i.i
t7t
i . 80
t
i . 86
t

i . 03
t
it.10
i . 21
t
i . 31
t
L3it

(Per cent)
1953
195U
1957
1958

-

Aug. 15
Aug. 22
Aug. 29
Sept. 5
Sept. 12 jo/

,

"

.69
.52
1.27
1.28
.77
.83
.82
.80
.77
.79

.

1.21
.96/
1.21
1.11
.98
.99
.98
.99
1.02
1.03

2/ Preliminary.
'
~
1/ Weekly average of daily figures. Average term 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 t e m
is 20 years.
Note.—Highs and lows are for individual series and may be on different dates for
different series.




4

STOCK MARKET




Exhibit D
Table for Exhibit C
Stock Market

Date

Stock price
index 1/

Trading
Stock market customer credit
Common
Customers' Bank
stock
volume 2/
(millions yields V Total debit bal- loans to
ances 1 / "others" 5/
*
of shares) (per cent)
(Millions of dollars)

1953 - High
Low .
195U - High
Low
1955 - High
Low
1956 - High
Low
1957 - High
Low
1958 - High
Low
July
August
Aug. 29
Sept. 5
Sept. 12 jd/

26.51* (1/2)
2.5
22.95 (9/18) 0.9
35.98 (12/31)
2U.93 (1/8)
l.l
1*5.89 (12/9) 1*.6
35.28 (1/llt) 1.5
1*9.61 (8/3)

1*3.22 (1/20)

1*9.08
39.1*8
1*8.53
1*0.37

(7/12)
(12/20)
(9/12)
(1/10)

1*5.98
1*7.70
1*7.75
1*7.97
1*8.53 •

S

5.38
6,25
1*.32

5.82
1*.08

1.*
*11

3.82

I. 2
t
1.1*
3.8
1.7

l.l
*3*
3.91
1**72
3.71
1*.58

3.2
3.0
2.7
2.9
3.3

3.97
3.78
3.77
3.76
3.71

2,1*55
3 2 :?|
2,1(05
ll,030
3,537
3,911,

S

1,665
1,311*
2,388
1,653
2,805
2,517
2,823
2,71*0
2,887
2,1*82

1*,251
3,551*

3,020

1*,251
n.a.
n.a.
n.a.
n.a.

3,020

2,1*87

n.a.
n.a.
n.a.

780
661
1,01*8
71*6
1,21*1

1,018

1,267
1,155
1,163
1,051*
1,317
1,051
1,231

1,186
1,186

1,191

n.a.—Not available.
g/ Preliminary. "
"
1/ Standard and Poor's composite index of 500 common stocks, weekly closing
prices, 19lil-U3"10. Monthly data are averages of daily figures rather than of
Fridays1 only. Highs and lows are for Friday'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. Yields shown are for dates
on which price index reached its high or low. .
hj End of month figures for member firms of the New York Stock Exchange whioh
carry margin accounts; excludes balances secured by U. 5. Government obligations.
£/ 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 reporting banks 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 E
Long-term Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)

1958

New capital
Corporate 1/
State and local 2/
1958
1
1956
1957
1
1956
1
1957

January
February
March

723
851. y
1,5612/

1,060
1,065
1,320

573
712
817

April
May
June

1,141
600
881

1,1*53

%

818
1,11*6
81*1

e/i,ioi
e/500
e/1,200

1,003
921*
973

1,063
651*
838

1,090
789
1,076

i.olv
1,088

3,135
2,622
e/2,801

3115
,**
3,11*9
2,899
2,951*

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

5,757
e/8,558

6,591*
9,1*93
12,1*1*7

7,'to
10,381*

July
August
September
October
November
December
1st
2nd
3rd
l*th

quarter
quarter
quarter
quarter

1st half
Three quarters
Year

.

.

81:
953
511

71*2
572
506

10*
*1
696
390

798
878
551

765
546
393

378
1*90
735

639
2/382
e/600

529
581*
1*31

1*08
206
357

698
633
698

639
31*7
1*09

2,276
2,227
e/I,621

1,820
1,701*
1,510*
2,029

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

>,503
e/6,124

3,521*
5,069
7,099

4,064
5,1*59

Excluding finance companies
1st
2nd
3rd
4th

quarter
quarter
quarter
quarter

r

2,891*
2,583
e/2,751

Year

3,237
2,889
2,582
2,810

1,61*7
2,51*1
2,21*6
2,826

11,518

9,260

e/ Estimated.
w
1/ Securities and Exchange Commission estimates of net proceeds.
2/ Data through June 1956 are Bond Buyer data classified as new capital by
Federal Reservej 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.
3/ Includes $718.3 million AT&T convertible debenture issue.
5/ Includes $571.5 million AT&T common stock issue.
jy Total new capital issues excluding offerings of sales and consumer finance
companies.




H.lli

Exhibit F
Other Security Offerings 1/
(In millions of dollars)
LongForeign government 2/
1
1956
1950
1
1957

Federal agency 3/
1958
1
1957
1

Januaiy
February
March

196
53

8*
1
19
*
30

37

April
May
June

139
198
120

123
18
*
12
*

50

9

28
7
30

—

215

1
*
60
1

11
**
5
21

1956

100

July
August
September
October
November
December
Year

507

8

95

1,163
251

72

523

125

•

—

60

60

—

l6U

2
39

•

—

—

109
—

—

300

169

572

Short-term
.State and local government k/

Federal agency 3/

January
February
March

233
I46O
273

326
1*55
Ht7

196
357
21*9

371
208
1**
11

638
1*30
505

380
220
283

April
May

357
351*
26U

205
337
153

125
252
,176

209
161
. 329

336
1*69
501

32331h
260

jg/286

272
272
252

195
207
179

601

22U
370
512

222
1*25
273

303
9k
159

29I
328
li*8

1,238
255
116

1*07
222
128

3,27k

2,706

July
August
September
October
November
December
Year

5,51*3 '

3,1*57

-

e/ Estimated.
_
1/ Data presented in this exhibit differ from those in Exhibit E in that refunding issues, as well as new capital issues, are included. Long-term securities are defined as those maturing in more than one year.
2/ Includes securities offered in the United States by foreign governments and
their subdivisions and by international organizations. Source: Securities and Exchange Commission.
2/ Issues not guaranteed by the U. S. Government. Source: long-term, Securities
and Exchange Commission; short-term, Federal Reserve.
ij/ Principally tax and bond anticipation notes, warrants or certificates and Public
Housing Authority notes. In some instances PHA notes included may have a somewhat
longer term than
 one year. Source: Bond Buyer.



Exhibit Q

H.lU

Large Long-term Public Security Issues for New Capital
(Other than U. S. Treasury) 1/
Proceeds of Large Issues Offered
(Millions of dollars)

Month

Corporate

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

^

July
August '

State and
local government

266
133
. 393
3hh
hOh
1*10
553
182
300
505
195
275
109

526
537
57U
420
399
318
605
1,093
725
356
281
771
209

Other 2/

2U5
15k
1,357
266
653
161*
86
la

.

Large Individual Issues Offered September 1 through 12

Issuer

Type y

Amount
Coupon
(millions
rate or
Offering
Maturity net interRating
of
yield
dollars)
est cost

CORPORATE
150.0 1983
Standard Oil Co. of Calif. S.F. deb.
Texas Eastern Transm. Co. 1st mtg.p.l.bds. 35.0 1978
Sears Roebuck & Co.
S.F. deb.
350.0 1983

k 3/8
5 5/8
k 3A

h.hO
5.71
U.75

Aaa
Baa
Aa

STATE AND LOCAL GOVERNMENT
G.O.
State of Delaware
Indiana State Office Bldg.
Rev.-Rent.
Comm.
G.O.
State of Connecticut
G.O.
San Diego U.S.D., Calif.
OTHER
None




17.0

1959-78

3.26

1.50-3.50

Aa

30.0

1963-88 U.23

10.0

1961-80 3.61

3.00-1.25
1.60-3.50
2.25-3.85

Aa
Aaa
A

20.0 1959-88 3.2k

u.lk

G-2

1/ Includes cozporate and other security offerings of $l£ million and over;
State and local government security offerings of $10 million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues and non-guaranteed issues t r Federal agencies.
g
2/ In the case of State and local government securities, 0.0. denotes general
obligations5 Rev.-Ut., revenue obligations secured only by income from public utilities; Rev.-Q.Ut., revenue bonds secured only by revenue of quasi-utilities; Rev.-S
revenue bonds secured by revenue from specific taxes only; Rev.-Bent., revenue
bonds secured solely by lease payments.




H.1U

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

. Date,of
computation

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

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

Corporate
526
578
576
1*58
383
378
1*98
1,123
555
356
266
768
161
785

218
183
33U
339
363
3k5
370
13l
298
1*93
177
225
55
2la

30
30
18
150
* 110
150
36

811
8*
15
6*
17
815
1,193
1,161
1,378
1,208
670
561
16*
*1
1,01*8
381
911*

1*71
379
551
5*
13
558
561*
18
*7
31*1
330
1*93
208
235
125
1*35

30
15
15
*
63
165
110
150
36

Forthcoming Large Offerings, as of September 12
Type

Amount
(millions Approximate date
of dollars) of offering

CORPORATE
Tennessee Gas Trans. Co.
Standard Oil Co. of Indiana
Consumers Power Co.
Consumers Power Co.
Public Service Co. of Indiana
^Peoples Gas Light and Coke Co.
Universal-Cyclops Steel Corp.
Montana Power Co.
Commerce Oil Refining Corp.
Martin Co.

1st mtg. p. 1. bds.
Deb.
1st mtg. bds.
Pfd. stk.
Pfd. stk.
Cap. stk.
S.F. deb.
1st mtg. bds.
Deb., bds. & common
S.F. deb.

50.0
200.0

Sept. 17
Sept. 18
Sept. 21*
15.0 Sept. 21*
Oct. 6
2k. 3
(rights expire)
Oct.
17.0
(rights expire)
15.0
1958
20.0 1958
1*5.0 1958
25.0
1958
35.0

STATE AND LOCAL GOVERNMENT
Colleges of the State of Texas
Florida State Board of Education
Los Angeles Co. Flood Hist., Calif,




Rev.
Rev.
Rev.-Ut.

17.1
12.5
30#0

Sept. 16
Sept. 16
Sept. 16

H.lU

H-2 :
Forthcoming Large Offerings, as of September 12 (Cont'd)
Issuer

Type

Amount
Approximate date
(millions
of offering
of dollars)

STATE AND LOCAL GOVERNMENT (Cont'd)
State of Oregon
State of Ohio
Commonwealth of Massachusetts,
State of Washington
^Chicago, Illinois
Chesapeake Bay Ferry Comm.
State of California

G.O.
Rev.-S. T.
G.O.
Rev.-S; T.
G.O.
Rev.-Ut.
G.O. '

20.0
30.0
61.0
10.0
20.0
lUi.O
50.0

Sept. 17
Sept. 18
Sept. 2k
Sept. 2k
Sept. 25
Oct.
Dec. 3

Bds.

15.0

Sept. 2k

OTHER
Kingdom of Norway

included in table for first time.
1/ Includes corporate and other issues of jl5 million and over; State and
local government issues of $10 million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues and non-guaranteed issues by Federal agencies.
Note—Deletions for reasons other than sale of issue: None.




Exhibit I
Yields on New and Outstanding
Electric Power Bonds, Rated Aa and A l/

Date
1952 - 1957
,
High
Low

Aa-rated <
offering yields
A-rated oJ^ferine yields
Amount above
Amount above
Actual
Actual
seasoned yields
seasoned yields
(per cent) (basis m i n t s ) (per cent) (basis points)
5.00(8/11/57 )
2.93(3/31/51)

1958 - January
February
March U
5
6
12
19
21
25
April 1
2
g "

87
-3

*3.60
3.893/

-8
22

L15
li.22
U.00
U.00

: . g

3
9
6

31
23
25

li-07

-7

3.98

5

U.OU
U.00

11
3

1.07
U.35

U
32

U.00
3.95

3.75

-1
-6

5

29
May 7
13
15
16
20
21
22
28
. June 1 0
17
25
July 2
9

3.962/
U.07
U.25

123
-15

hh
50
28
26

U.05
3.98
l . QO
l

5.50(11/7/57)
3.00(3/17/510

3.90

21

3.85
3.85.

16
16

3.85
3.82
3.95

17
12
2U

LOO

25

3.98^

fctt

g

1

It. 3 5 2 /

31

*—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/ Provides for 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 issues have no such provision.





Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102