Macy's bonds fall four points in two days; analysts see weak Christmas season ahead.

Scrooge's shadow lengthened over R.H. Macy & Co.'s Christmas season yesterday as the retailer's junk bonds suffered a sharp two-day fall.

Between Monday and late yesterday, Macy's 14 1/2% bonds due 1998 lost about for points, while the 14 1/2% bonds due 2001 lost about 4 1/2 points over the two-day period.

Rumors that Heller Financial Inc., a factoring company, would stop guaranteeing Macy's receivables helped push the bonds lower, analysts said. Heller has not confirmed or denied the rumor, a Heller spokesman said.

Macy's bonds have been known to move sharply on rumors, one high-yield analyst said.

"It's not untypical of Macy's," she said.

Factors lend to suppliers at a discount against the receivables of the retailer, one analyst explained. Another analyst added, however, that Heller's alleged pullout would not affect the Christmas season because Macy's has already stocked its shelves.

Also weighing down the bond sis general "skittishness" about the economy and eroding consumer confidence, analysts said. Overall, retail analysts predict a weak Christmas season similar to last year.

"Consumer buying trends are far less positive than they have been in other years," one analyst said. He predicted that retail bonds, as usual, will be soft until mid-December when players get a handle on how the Christmas season is progressing. He described the period between October and mid-December as a "nail-biting time" for retail players.

Yesterday's Markets

The high-yield market overall fell about 1/4 to 1/2 point yesterday, while the high-grade market was unchanged in the short end and down between 3/8 point and 1/2 point in the long end.

Notable in the high-grade market yesterday was Public Service Electric & Gas Co.'s issuance of three deals totaling $450 million. Moody's rates all three of the deals A2, while Standard & Poor's Corp. rates them A.

The company issued $200 million of 8.750% Series EE first and refunding mortgage bonds. Nonrefundable for five years, the bonds were priced at 99.569 to yield 8.79%, or 91 basis points over comparable Treasuries. A syndicate headed by Lehman Brothers won competitive bidding to underwrite the offering.

A group led by Kidder, Peabody & Co. won the right to underwrite PSE&G's $100 million of 7.875% Series FF first and refunding mortgage bonds due 2001. The noncalable bonds were priced at 99.71 to yield 7.916%< or 57 basis points over comparable Treasuries.

Lehman's group also won the bidding for the $150 million six-year deal. Those noncallable Series GG first and refunding mortgage bonds were priced at 99.707 to yield 7.185%< or 45 basis points over comparable Treasuries.

"We were pleased with the rates," a a company source said.

The Federal National Mortgage Association has issued $250 million of 7.75% variable-rates notes priced initially at par to yield 41 basis points over comparable Treasuries. Noncallable for three years, the bonds mature 2001. Goldman, Sachs & Co. sole managed the offering.

Norwest Financial Inc. has issued $150 million of 7.10% notes due 1996. The noncallable notes were priced 99.83 to yield 7.14%. or 62.5 basis points over comparable Treasuries. Moody's rates the notes Aa3, while Standard & Poor's rates them A-plus. Merrill Lynch & Co. lead managed the offering.

Wisconsin Gas Co. issued $40 million of 7.50% notes due 1998. The noncallable notes were priced at 99.835 to yield 7.53% or 58 basis points over comparable Treasuries. Moody's rates the offering A1, while Standard & Poor's rates it AA-minus. Dean, Witter Reynolds lead managed the offering.

In yesterday's rating actions, Standard & Poor's upgraded Playtex Apparel Inc.'s approximately $180 million of senior subordinated discount notes due 1999 to A-plus from B-minus, a move to investment grade from non-investment grade. The rating yesterday was removed from CreditWatch where it was placed on Aug. 8, 1991, for a possible upgrade pending Sara Lee Corp.'s purchase of the company.

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