H.llj. January 12, 19$$ CAPITAL MARKET DEVELOPMENTS

Transcription

1 Not for Publication DECONTROLLED AFTER SIX MONTHS H.llj. January 12, 19$$ CAPITAL MARKET DEVELOPMENTS Small volume of security issues last week - Tvro large State and local government security offerings with proceeds of 6 million dollars were issued during the week ending January 7; no large public corporate offerings were floated. This week 171 million dollars of State and local issues and a 5>0 million dollar public utility offering are scheduled for flotation. Public Service Electric and Gas Company postponed its 2 million dollar common stock issue which had been scheduled for offering on January 12 because of market conditions. General Motors announced ;plans last week to register a 325 million dollar common stock issue to be sold by subscrip- tion rights expiring March 7. This issue would be the largest,stock offering ever made by a single corporation unless one includes the convertible debenture issues of AT&T. Proceeds from this issue will be used partly for capital expenditures and partly for working capital. Bond yields - Yields on outstanding corporate Baa and high-grade municipal bonds rose one basis point during the week ending. January 7j corporate Aaa bond yields declined slightly. Treasury bond yields rose substantially last week and again on January 11. Stock prices - Stock prices, as measured by the SEC index of 265 common stocks, dropped 3#9 points to last week..daily indexes indicate a small decrease on January 11 after a rise the day before. Daily trading volume increased to an average of b.6 million shares last week but dropped sharply this Tuesday.

2 -2- Further details on capital market developments available from exhibits - More detailed information concerning recent capital market developments will be found in the following exhibits which are attached hereto:. A - Bond Yields B - Stock Market C - Corporate and State and Local Government Security Offerings and Placements D - Large Public Security Issues for New Capital (other than U.S. Treasury) E - Forthcoming Large Public Security ' Offerings for New Capital (other than U. S. Treasury) Business Finance and Capital Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System.

3 H. 14 EXHIBIT A BOND YIELDS WEEKLY PER CENT PER ANNUM 4 CORPORATE Baa CORPORATE Aaa 'C L 1 U.S. GOVERNMENT LONG-TERM l /HIGH-GRADE MUNICIPAL W, STANDARD AND POOR'S CO I I I I I I I I I I I I I I I I I 1 I I I I I 1951 J 5 D M J S I I I 1 I I I II 1 I D M J S D Date Corporate 1/ Aaa Baa U. S. Govt. lonft-tern 2/ Spread between Corporate Aaa and U. S. Govt. 5? V (Per cent per annum) High h k8 2.# liich 3.1i lit 2.9? b.19 2M3 195U - Kiph U J» y.hh 2.hh December : December 1? * December U5 2.# December hh h January y.us T 2/ Federal Reserve; weekly average of daily figures. 3/ Standard and Poor's Corporation) Yednesday figure. i for individual series and may be on different dates

4 STOCK MARKET Hi* High 1952* - High November December December 23 December January 7 Stock price index 1/ (19li7-l;9-100) lah.o 221.h U Trading volume 2j (millions of shares) h Connon stock yields 3/ (per cent i U.20 li.39 U.20 Customers' b-'il-inces hf (millions of dollars) 1,328 1,21)1 1,665 1,31a 2,202 1,653 2,202 Bank loans to "others" for purchases ities 5/ (millions of dollars) li61 L U82 it 82 of 2t>5 common stocks, weekly closing price, ± ; converted to 191* by Federal Reserve. 2/ ",'eeklv averages of daily trading volume Hew York Stock"Exchange. loans have fluctuated more than total loans. n.a..>ot. available. for indivicluai series and may be on different dates. Note.!!iphs and lows are for different series.

5 H.l4 Exhibit C Corporate and State and Local Government.Security Offerings and Placements (In millions of dollars) April May June July August Septeiaber October November December 1st quarter 2nd quarter 3rd quarter ii'th quarter Year Mew capital Corporate State and local U! j I 1953 January February Marche/500 5a h39 66o U e/300 * 5/750 1,643 1,998 2,021 e/1,945 e/7, #5 1,123 1*83 # #2?1/ 1,912. 2,578 8,495 e/ e/hoo e/800 ' 1,372 2,334 1,188 e/1,795 e/6, ,176 1,112 1,253 1,636 5,477 Excluding finance companies 2/ 1st quarter 2nd quarter 3rd quarter 4 th quarter Year 1,562 1,931 1,9U e/l,6l4 e/7,0li8 1,669 1,991 1,223. 2,344 7,227 2/ Total new capital issues excluding offerings of sales and personal finance z companies. ". e/ Estimated. Note. Details may not add to totals due to rounding.

6 Il.lli Exhibit D Large Public Security Issues for New Capital (Other than U.S. Treasury) 1/ Proceeds of Large Issues Offered (Millions of dollars) Month Corporate State and local government Other 2/ December 195b - January 9# * February 103» 213 ' March April May 32 U 557 June July August September October 335 iil3. W5 388 November December 9h Large Individual Issues Offered January 1 through 7 Issuer " Type 3/ Amount (millions of Maturity dollars) Coupon rate or net interest cost Offering yield Rating CORPORATE None ' STATE AND LOCAL G0VERNLJ3IIT State of California Caddo Parish School District, Louisiana None OTHER G.O ^ 2.03 G.O n.a Aa O.0O-3.OO A

7 D-2 1/ Includes corporate and other security offerings of 1$ million dollars and over; 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 arid local government securities, G.O. denotes general - obligation; Rev., revenue bonds; G.R., general obligations additionally secured by facilities revenues; and,l.l., limited liability obligations secured by pledge of designated revenues. h/ Bonds maturing 1976 not publicly reoffered.

8 H.lli Exhibit E Date of computation Forthcoming Large Public Security Offerings for New Capital (Other than U. S. Treasury) 1/ Expected Proceeds fron Forthcoming Large Issues During month following - date shown Corporate Subsequent to date shown State and local govt. Other 2/ Corporate State and local govt. Other 2] Dec , Jan ' ,660 Feb , Mar Oil 5# 555 2,789 Apr k7 2, Hay ,971 June i,52lt July $k 303 1,553 Aug h ,876 Sept. 30 3k3 383 klh 2,158 Oct , Nov k i-6 2, Dec U ,Hill 35 Forthcoming Large Offerings, as of January 7 Issuer CORPORATE.Type Amount Approximate date (millions of offering of dollars) Commonwealth Edison SF deb January 11 Public Service Electric & Gas Co. Pfd. stock 25.0 Delayed Duquesne Light. Common stock 13.5 January 17 New En gland Power 1st mtg. bonds 25.0 January 18 Marine Midland Corp. of Buffalo Pfd. stock 20.2 January 2k Consumer Power Company Idt mtg. bonds 30.0 January 25. Public Service of Oklahoma 1st mtg. bonds 20.0.January Kansas City Power and Light 1st mtg. bonds February 15 (General Motors Corp. Common stock March 7 New England Telephone and Telegraph Common stock 15.8 March STATE AND LOCAL GOVERNMENT New York State Bridge Authority Rev January 10 Public Housing Authorities January 11 Los Angeles School Dists., Cal. G.O. 20,0 January 11 St. Louis, Missouri G.O January 12

9 and local government issues of 5 million.and over. 2/ Includes foreign government and International Bank for Reconstruction and Development issues. ". n.a«: Not available. * Included in table for first time. E-2 Forthcoming Large Offerings, as of January 7 (Cont'd) Type Amount Approximate date (millions of offering of dollars) -STATE AND LOCAL GOVERNMENT (Cont'd) State of Michigan L'.L. 5.0 January 18 *New York City 65.2 January 19 Harris County, Texas n.a January 25 Philadelphia, Pennsylvania n.a January 25 Southeastern Oakland County Water Authority, Michigan Rev. 5.U January 26 -Los Angeles Dept. of Water, & Povrer Rev January 26 Texas Turnpike Company Rev January Sam Houston Company Rev January ^Allegheny county, Pennsylvania 7.2 February 1 *San Antonio, Texas G.O. 6.0 February 1 -a-milwa.uk ee County, Wisconsin n.a.' 15.5 February 7 *Long Beach Unified S. D., Gal. n.a February 8 Florida State Board of Education n.a. 9.2 February 8 ^Houston, Texas n.a March It New Jersey Turnpike Authority n.a Winter Connecticut Expressway Rev Winter - Texas Turnpike Authority Rev Winter *Los Angeles, California Spring *San Diego County, Cal. 8.1* Spring Inter-American Center Auth., Fla. Rev Spring Michigan Turnpike Authority Rev Spring State of Louisiana n.a Spring Metropolitan Water Dist. of So. Cal. G.O Spring Illinois Turnpike Authority Rev Dade County Port Authority, Fla. Rev Springfield, Illinois n.a Allegheny County, Pennsylvania Sanitary Authority Rev California Toll Bridge Authority Rev Florida State Turnpike Authority Rev Jersey City Sewerage Auth., H. J. Rev North Carolina Turnpike Authority n.a OTHER Montreal Deb. ' 35.0 January 26