Prices of long-term tax-exempts fell along with the government bond market yesterday on positive economic data.

In light secondary trading, dollar bond prices dropped 3/8 point on average and as much as 1/2 in spots, but trailed even bigger losses in the Treasury market where the 30-year bond fell close to a point.

In light new-issue activity, an offering of $100.7 million Eastern Municipal Water District, Calif., water and sewer revenue refunding certificates of participation topped the calendar and reached the market with a maximum yield of 6.88% through an underwriting account led by Paine Webber Inc.

Traders were disappointed early in the session when construction spending for April came in a little stronger than expected, rising 0.8%. Shortly thereafter, the National Purchasing Managers' index registered 45.4% in May, up from 42.1% in April, indicating that the economy is on the rise. Another troubling indicator was the Commodity Research Bureau index, which soared 2.26 points yesterday, to close at 217.69.

The Eastern Municipal Water District offering was backed by Financial Guaranty Insurance Co., except for the $19.7 million term bonds of 2l023 that were not formally reoffered.

The $47.8 million term bonds, due 2020, were priced at 92 3/4 as 6.30s to yield 6.88%. The $10.8 million term bonds of 2009 were offered at 96 3/4 as 6 1/2s to yield 6.816%. And the serials were scaled from 4.50% in 1992 to 6.65% in 2005. Because of the insurance, these bonds are rated triple-A by Moody's Investors Service and Standard & Poor's Corp.

An officer at PaineWebber said that "the serial portion of the loan was targeted for the big California trust departments and smaller retail accounts and was almost 100% taken by them, while most of the term bonds went to the tax-exempt mutual funds." The underlying credit, Moody's A1 and Standard & Poor's A-plus, also "helped the deal," he added.

The PaineWebber officer pointed out that this was the second deal the account had done for the issuer. The other was back in March and FGIC was also used on port of that loan, he noted.

In a smaller negotiated transaction, a Goldman, Sachs & Co. account tentatively priced $56.9 million Austin, Tex., combined utility systm revenue refunding bonds. The issue is insured by AMBAC Indemnity Corp. and is rated triple-A by Standard & Poor's and Moody's.

The $22.7 million term bonds were tentatively priced at 98.772 as 6 3/4S to yield 6.875%. Returns on the serials tentatively run from 4.50% in 1991 to 6.55% in 2003.

In dollar bond trading, syndicate price restrictions were removed from last week's $500 million Los Angeles County Transportation Commission, Calif., issue. The insured 6 3/4S of 2018 were quoted in the free market at 98-98 1/4 to yield 6.89%, whilethe uninsured 6 3/4Sof 2020 were at 96 5/8-3/4 to yield 7.01%. Last week's Massachusetts 6s of 2011 were quoted late yesterday at 85-85 1/4 to yield 7.43%.

In the more seasoned dollar bond market, Florida State Board of Education 7 1/4S of 2023 were quoted at 102 7/8-103 1/8 to yield 6.88% to the 2004 par call. New Jersey Turnpike Authority 7.20s of 2018 were at 101-101 3/8 to yield 6.96% to their par call in 1999. And New York LGAC7s of 2016 were at 94 7/8-95 ~/8 to yield 7.43% to maturity.

Note prices were firmer in the cash market with very little paper to trade, participants said, California revenue anticipation notes, due at the end of the month, were bid around a 4.80%. The market for New York State December tax and revenue anticipation notes was at 4.03% bid, 3.90% offered. And New York City seasoned revenue anticipation notes, also the due at the end of June, were being offered around a 7.50%.

In the new-issue sector, Lehman Brothers won $130 million San Bernardino County, Calif., tax and revenue anticipation notes and reoffered them as 4 3/4S to yield 4.30% to their July 1, 1992, maturity date.

Traders said late yesterday that the $485 million New York City bonds will probably not be priced until tomorrow by the Goldman, Sachs & Co. underwriting team. There will also be $115 million of taxable bonds.

Yesterday's Standard & Poor's affirmed the city's A-minus for the issue, but noted that the outlook remains "negative." On Friday, Moody's affirmed its Baal rating for city bonds.

Negotiated Pricings

Utah Housing Finance Agency, $48.2 million single-family mortgage senior bonds, 1991 issue D (federally insured or guaranteed mortgage loans).

Ratings: S&P's AA.

The $22.6 million non-AMT portion of the offering was comprised of term bonds yielding 7.25% in 2011, 7.30% in 2016, and 7% for the super sinkers of 2016.

The $20.5 million AMT issue was comprised of serials scaled from 6% in 1994 to 6.95% in 2001, term bonds yielding 7.55% in 2023, and super sinkers yielding 7.25% in 2022.

Both non-AMT and AMT issues were priced at par.

There were also $5 million taxable bonds priced at par to yield 9.125% in 2002.

The bonds were marketed through an account headed by Goldman, Sachs & Co. The verbal award was received yesterday.

West Knox Utility District, Tenn., $25.6 million water and sewer refunding and improvement revenue bonds. The offering is comprised of $13.8 million tax-exempt bonds and $11.8 million taxables.

Ratings: Moody's Aaa; Standard & Poor's AAA. MBIA insured.

The tax-exempt issue is comprised of $3.5 million current interest bonds priced at 98.579 as 6 3/4S to yield 6.87% in 2013 and capital appreciation bonds yielding from 6.20% in 1999 to 7% in 2010 and 2011.

Returns on the taxables are expected to run from 6% in 1991 to 8.50% in 1988.

Cumberland Securities Co. is manager for the underwriters. The official award is expected tomorrow.

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