High-grade corporate bond prices fell with Treasury yesterday as hopes dimmed that the Federal Reserve would move to ease credit policy.

"The Fed did nothing and that's exactly why the corporate market is down," one high-grade trader said. "There was great expectation that they would move to ease credit."

Corporates surrendered 3/8 point or more in the 10-year sector and about 5/8 point in the 30-year maturities, traders said.

Asked whether he still thought the Fed would ease, one trader replied, "We're hoping."

"I think there's still a possibility," another trader said.

But David Blitzer, chief economist at Standard & Poor's Corp., does not believe those hopes will be realized.

"I don't think that they are going to ease," he said. "I think that the Fed does not like messing around right around an election."

Last Friday's September employment report proved "just mixed enough" for the Fed to find reason not to act, Blitzer said. He added, however, that anything is possible.

In secondary trading yesterday, high-yield bond prices were unchanged to 1/4 point weaker.

New Issues

Federal National Mortgage Association issued $500 million of 6.80% medium-term notes due 2002. Noncallable for three years, the notes were priced at 99 30/32 to yield 6.809% or 56 basis points over comparable Treasuries initially. The notes were being reoffered at various prices. Goldman, Sachs & Co. lead managed the offering.

Dupont issued $300 million of 6.750% notes due 2002. The noncallable notes were priced at 99.677 to yield 6.795% or 55 basis points over comparable Treasuries. Moody's Investors Service rates the offering Aa2, while Standard & Poor's Corp. rate it AA. Morgan, Stanley & Co. was lead manager.

Fruit of the Loom issued $250 million of 7.87% senior notes due 1999. The noncallable notes were priced at 99.497 to yield 7.97%, or 212.5 basis point over when-issued seven-year Treasuries. Moody's rates the offering B1, while Standard & Poor's rates it BBB-minus. First Boston Corp. lead managed the offering.

Digital Equipment Corp. issued $250 million of 7.125% notes due 2002. The noncallable notes were priced at 99.191 to yield 7.24% or 95 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A-plus.

Federal Home Loan Banks issued $200 million of floating-rate notes due 1997 at par. The notes float monthly at 52 basis points under the 11th District cost of funds index and pay quarterly. The first coupon is 4.354%. Merrill, Lynch & Co. managed the offering.

Consolidated Natural Gas issued $150 million of 5.875% debentures due 1998. The noncallable debentures were priced at 99,.125 to yield 6.05% or 54 basis points over five-and seven-year interpolated Treasuries. Moody's rates the offering A1, while Standard & Poor's rates it AA-minus. A Salomon Brothers Inc.-led group won competitive bidding to underwrite the offering.

Carolina Power & Light issued $100 million of 6.75% first mortgage bonds. The noncallable bonds were priced at 99.517 to yield 6.817%, or 57 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A. A group led by Prudential Securities managed the offering.

Federal Home Loan Mortgage Corp. issued $100 million of 6.14% notes due 1999 at par. Noncallable for three years, the bonds were priced to yield 32 basis points over comparable Treasuries. Merrill Lynch lead managed the offering.

Yesterday's Ratings

Standard & Poor's has given its preliminary BBB-minus rating to Noranda Forest Inc.'s $400 million shelf registration.

"Although Noranda Forest is active in all major segments of the forest products industry, its building materials and papers divisions account for about three-quarters of consolidated sales," a Standard & Poor's release says. "The company has been severely affected by the downturn in the industry over the last two years, reporting net losses of [Canadian] $209 million and [Canadian] $95 million in 1991 and 1990."

Standard & Poor's has given a B rating to Katz Corp.'s $100 million of senior subordinated notes due 2002. The implied senior rating is BB-minus.

"The rating reflects the company's heavy debt usage and limited leeway in financial covenants and longer-term prospects for mature business growth," the release says. "The company holds a strong market share in the radio and television national spot media representation business, but competition among key players and unpredictable trends in spot advertising spending may affect long-term revenue stability."

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