October 9, 1982

In a clear signal that it expects interest rates to decline further, the Federal Reserve Board announced yesterday that it had lowered the interest rate it charges on loans to banks to 9 1/2 percent from 10 percent. Even before the late-afternoon announcement, the stock market surged for the third consecutive day, with the Dow Jones industrial average rising 20.88 points, to 986.85, its highest level in more than two years. Analysts attributed the bull market to the widespread belief that the Federal Reserve was easing monetary policy, an expectation that was reinforced by the cut in the discount rate. Interest rates declined sharply in the bond and Treasury bill markets following the Federal Reserve's announcement of the cut in the discount rate to its lowest level since November 1978. The rate has come down from 12 percent this past summer.

John A. Cody, the head of a key teamsters local in the metropolitan New York area, was convicted today of Federal charges of labor racketeering and tax evasion. Mr. Cody, who is 62 years old, was found guilty of seven of eight charges. The jury returned its verdict in Federal District Court here after one day of deliberations. As president of Local 282 of the International Brotherhood of Teamsters, Mr. Cody is one of the most influential figures in the metropolitan area's construction industry.

When the unemployment figure of 10.1 percent was announced in Washington yesterday, Democrats got the political lever that they believe can turn the 1982 election into a sweeping victory. Republicans got the chill statistical news they feared, but they said it was only one part of this year's political equation. Robert Squier, in Memphis to make a new television commercial for Senator Jim Sasser, Democrat of Tennessee, stressing the double-digit rate, saw the psychological impact as dramatic. ''It's like breaking the four-minute mile in politics,'' he said. Senator John C. Danforth of Missouri, a Republican campaigning in St. Louis, called the numbers a ''real tragedy, a human tragedy.'' He said he hoped that Missouri voters would be patient but added, ''I'll let you know in three and a half weeks.''

Unemployment in September rose three-tenths of a percentage point to 10.1 percent of the work force, the highest monthly figure in 42 years, the Labor Department reported today. The figure took on political significance because it is the last that will be announced before the midterm Congressional elections Nov. 2. Republicans, led by President Reagan, and Democrats, hoping to take firm control of Congress, quickly began blaming each other for the latest sign of the faltering economy. According to the seasonally adjusted figures compiled by the Bureau of Labor Statistics in its monthly survey of 60,000 households, more than 11,260,000 people out of a civilian labor force of 110,980,000 were out of work last month. This was an increase of 450,000 since August and more than three million in the last 12 months.

The Polish Parliament overwhelmingly approved a law today that bans Solidarity, the independent trade union that once captured the imagination and allegiance of nearly 10 million Poles. The law abolishes all existing labor organizations, including Solidarity, whose 15 months of existence brought exhilaration to many but drew the anger of the Soviet Union and other Eastern-bloc countries. It replaces them with a new set of unions whose ability to strike is sharply restricted. Reaction of Work Force Uncertain The scattered, fugitive Solidarity activists, more than 600 of whose leaders are in custody under martial law, have given no indication of their response to the Government edict outlawing their organization.