With the Federal Reserve Bank raising its...

With the Federal Reserve Bank raising its discount rate one half point to 6% Friday, and the major banks immediately raising their prime rates to 8.75%, the stock market was not able to weather the storm of selling as most stocks fell before the three-day Labor Day weekend, according to Irving Katz, director of research at San Diego Securities.

Interest-rate sensitive stocks were particularly hard hit with Home Federal Savings and Loan down 1 1/2 to 32, Imperial Corp. of America down 1 1/8 to 14, Great American First Savings Bank, down 7/8 to 16 5/8, and San Diego Gas & Electric, down 1 3/8 to 32 5/8.

Especially losing ground were stocks popular with institutional investors who rushed for the exit. Rohr Industries which is 74.1% controlled by institutions was down 3 5/8, to 31 as none of the many buy-out rumors concerning Rohr materialized. Home Federal Savings & Loan which is 78.2% controlled by institutions was down as mentioned previously .

Other institutional favorites on the downside included Price Co., down 2 to 47 3/4, after a recent run-up from low 40s, and Beeba’s Creations, down 1 1/2 to 16 1/2 after its recent run-up from 12.

Cubic Corp. was down 1 7/8 to 19 3/8, despite keeping alive in court its hopes of securing the $6 million San Diego freeway cellular-based phone system, previously awarded to Comarco.

Precision Aerotech was down three-eighths to 7 after announcing lower first quarter earnings of 11 cents versus 19 cents per share the previous year on a smaller number of shares outstanding. The company, which went public November 1986 at 7 3/4, has seen its stock range between 11 1/8 and 6 3/8.

Burnham Pacific Properties was down 1 1/8 to 20 1/8 as the market adjusted to the three-point rise of last week on a strong buy recommendation of Merrill Lynch.

A new low of $3 was reached by Western Health Plans, the local health maintenance organization still attempting to become profitable.

Stocks selling at or near their 52-week lows include IRT Corp., International Robomation, Celltronics, Gascard, Northview, Telequest, Women’s Health Centers, Pancretec and Medical Imaging Centers.

Xscribe, which went public on Aug. 11 at $8, dropped another one-quarter to 7 1/2.