tv Nightly Business Report PBS March 4, 2019 5:00pm-5:30pm PST
. this is "nightly business report" with sue herera and bill griffeth. monday blues.o stocks fall start the week e,en though there's increased optimism over trn issue that has pushed the market higher in recent months. u-turn. ten years of rock bottom rates are a thing of the past and that's making it more expensi to buy a car. pay day. why this is the time of year many americans feel like they've hit the japot. those stories and much more tonight on "nightly business report" for this monday, ma good evening, everyone. welcome. tall griffeth is off tonight. stocks fell to the week. there was some optimism early on that the marnt would rise the prospect for a trade deal after reports that the u.s. and china were slowly getting closer
to an agreement. it is that same hope that has been propelling the market high for months, but for whatever reason today it simply didn't resonate a stocks dropped. the dow jones industrial average dropped 206 points to 25,819. the nasdaq fell a 17 the s&p 500 was down 10. >>b pisani has more on day's decline. eporter: an early rally quickly fizzled out with the dow falling more than 400 points. it was the biggest one-day decline in severek why the drop? it's tough to pin the drop on any one theme. this indicates buyerexhaustion. after all, we had a big rally, partly on trade talk hopes and nowt a deal is looking more and more likely, stocks took a breather. call it on the news. trade-related groups like technology and industrials were in the red. we saw names not associated with trade like retai, stoc which were strong last week, and daalth care also lagged on the
session software stocks like salesforce also faded and transportation stocks tumbled for a seventh straight day. airline stocks in particular like delta were weaker. health care lag bd the pharmaceutical names like pfizer were all down. e big issue is how much more room does the market have to run on if the federal reserve is going to raise interest rates and on the hope for china trade al. remember, global growth is still weak and a stronger dollar is also a concern out there. the sectors that have seen the biggest cuts to their earnings estimates so far this yearre energy, materials and technology. that's no sumarise. rials and technology are both closely tied to trade certainty. now the key to getting stocks back up towards historic highs is to stop that downward earnings revision trend that we've been seeing for months now. for that we need to see more stability on the global markets front. for "nightly business report,"
i'm bob pisani at the new york stock exchange. now to trade and a few new developments that could beng world's two largest economies within striking distance of a deal afteronths hot and cold discussions. kayla tausche has the details. >> reporter: a potential detante could be close according to three sources close to the situation. the two sides continue to negotiate via video conference to reach an agreement on outstanding issues ahead of a planned summit for late march at the president's south florida resort i the deal a looks now would see china buy more than a trillion dollars inu. goods over six years. china will have a n law for intellectual properties. there would be broad agreement and several macro economic buckets and anee agreement to k talking. it's through that dialogue that the u.s. would try to hold china accountable andntf presidei doesn't follow through then the u.s. could re-introduce
sanctions without retaliation. president trump is rushing a deal that's not harsh enough after walking away from talks t week.rth korea l >> i think the president's too anxious to sign a deal.hi failure in hanoi i think does create a context where he's looking to put that signature on something and i'm afraid that it will fail to deal with the bigger structural problems that we face. >> >> reporter: many republicans acknowledge the importance of solving the long-term issues but shall willing to give him the benefit of the doubt now. >> the right move is to get the best deal hean get athis time. this is not going to end it. if it ends our contentious trade relationship with china, it's going to bring the temperawnre i suspect. >> the deal would take a lot of the heat off. the u.s. would remove a majority of the tariffs it's placed on china and china wld do the same. for "nightly business report," i'm kayla tausche in washington. al> as negotiators work on a trade chinese officials
are gathering for their major annual parliament try meeting called the national people's congress. the meeting come as china battles an economic downturn. investors hope this will shed some light on the world's second largest economy. beijineun is in >> reporter: at the national people's congress on tuesday, beijing's leaders are expected to acknowledge the slong economy lowering the growth target to a range of 6 to 6.5%. investors are also expectinghe government to expand its budget deficit, but what's alsot significor foreign investors is the new foreign investment law. this will be the only major law to pass this year and it's meant to even the playing field. it's a way for china to address the trade war with the u.s. the chinese t believe thats new foreign investment law is significant ending three joint venture laws barring forced technology transfers, preventing a state from illegally setting market accs and allowing
foreign firms to help set stanemrds. the pro is with many rules in china, they look great on paper but can the be applied evenly and fairly? the best thing one business official coulday to me was at least it's not negative. for "nightlbusiness report," i'm eunice yoon in ewijing. ersey governor is doubling down on raising taxes on .millionair phil murphy will outline a proposal in his second state of th budget address tomorrow. the measure's new waxl hit those with over $1 million. it will bring in $450 million for the state. well, socialism has become a recent buzz word in politics. in a recent poll voters prefer capitalism over socialism yet they also want the government to do more, not less. shhn harwood joins us tonight from gton. good to see you as always, john. so let's starthe with term socialism. what does the nbc wall street
journal poll tell us about that? >> what it tel us,sue, is that by almost a 3 to 1 margin americans say they have a negative view of socialism. just 18% vw that term positively. 50% view it negatively, which is of course the mirror image of how they feel about capitalism. >> what does it tell us about the appeal of capitalism? >> well the50% support or favorable view of capitalism down somewhat from what other polls have found in recent years so it suggests tt maybes people have struggled with stagnant wages overhe last several years, especially people in the working and middle classes, that the appeal of capitalism, the shine is off a little bit but, still, it's a clear preference overli soc and all that explains why it is that republicans are eager to slap that label on to what democrats are talking about and democrats, with the exception of people like bernie sanders and maybe alexandria ocasiocasio-co
say i'm not a socialist, i'm a capitalist. >> how is this going to play out? who has the upper hand here? >> on the labeling, republicans have the,pper hahowever, you have to temper that with the idea that if you look at this poll, 55% of americans say they want government to do more to help them well, that's another way of describing what republicansre calling socialism. people like things like social security and medicare and the desire for more government assistance is why democrats go out on tmp s and talk about free college and medicare for all and more infrastructure. people want some. assistan >> on that note, john harwood in washington. thanks, john. >>ou bet. y'> time to take a look at some of toda upgrades and downgrades. kraft heinz was upgraded. they cite the reasonable oa19 profit following the recent stock plunge.
the stock rose 2.5% t 33.23. bed, bath, beyond was downgraded. the analyst says he' disappointed with the broad restructuring. the price target is $1 that price fell 5%. llards was downgraded. there's a 20% rise in stock. the price target is s. thck fell 5% to 71.47. stiahead, are you in the market for a car? well, you might be in for sticker shock. and not only because of the
okay i con continue maker purdue pharma is reportedly exploring bankruptcy. it would address potentially significant lieblabities from thousands of lawsuits saying they contributed to the opioid crisis. purdue has denied it saying the fda approval carried w tnings abou risk of misuse. more than 1,000 lawsuits have been filed agast purdue and others. space-x's capsule had a successful docking a the international space station over the weekend. as we reported friday, the b spacecraft ilt to carry u.s. astronauts into orbit starting later this year. the mission is considered a major milestone for space exploration since it's part of nasa's push to resume astronaut launches from u.s. soil from the first time since
1997. speaking of tesla, the electric car maker will unveil the model y suv. in a series of tweets musk said it would cost 10% more than the model 3 and have slightly less range for the same battery. separately regulators are reportedly investigating two ngfatal accidents invol tesla vehicles, both in florida. one involved a tesla model3, the other a model s. according to reports, the focus of the probes are on the flammability of the vehicle's batteries and tesla's drive assistanature. well, after years of paying relatively low interest rates on auto ans, car buyers are now doing a double take. interest rates have risen to their highest levels in a decade. phil lebeau has more on higher rates and the slowdown in showroom sales. >> reporter: it's getting more expensive to buy a new car or truck. not only are automakers raising pric vehicles, the interest rates on auto loans have soared
to a ten-year high.th last m the average rate for a new car auto loan was 6.26%, up more than 1% compared to a year ago. and well above the average rate from five years ago. >> coming backt into the mar after maybe years ago paying a 1.9, which was quitecommon, now they're up to a 5%, that is a big monetary difference. so we're talking, you know, quite a bit -- thousands of llars over the life of the loan. >> reporter: why is it costing more to borrow mon for an auto loan? one factor is the federal reserve raising interest rates. it's f automakers to pull back on offers for 0% financing, meanwhile, both dealers and lenders are much more about who qualifies for the lower rate loans. even though buyers are being forced to pay more, it's not stopping them from choing pricier models of trucks and
suvs. >> people rightow are ponying up and essentially still continuing to buy these cars although w do think there is some caution ahead in terms of how long this can last. we areeeg sales slow down slightly. s auto loan rates have increased, it's causing a growing number of people to consider leasing instead of buying a new model.nt while theest rates may not be much different, generally speaking those who lease pay about s$100 l per month than those who buy a new vehicle with loan.to phil lebeau, "nightly business report," chicago. eli lilly is t cutting price of a key drug by 50%. that's where we begin tonight's market focus. the drug company will release a generic version of its popular diabetes medicine humalog. the new product will target patients who pay for their insulin out of pocket. they will sell the branded
version at the regular price. shares fell 1% to 127.46. they hit a one-year high early in the session. biogen is saying it will buy night star therapeutics. biogen is hoping to tap into the lucrative gene therapy department. they fell but nigoa stard 66% to ea.18. h care services group says that it cannot file its 10k for 2018 yet because the sec is looking into its earnings per share calculations practices. the compa which provides housekeeping and dining services to the health ce industry received a subpoena last march from the sec inonnection with this issue. 10ks are filed annually and they contain company's financial information. the shares were down 13% to
32.78. at&t is restructuring its warner media division which "the wall street journal" says will involve, quote, significant layoffs. the plan includes a revamp of cnn's digitalti opes and a unit called warner entertainment which combines hbo and turn n s ner's entertainment. well,very retailer would love to look into the future to stay just one step ahead of new trends. today the industry got its chance to show o what it thinks the future will hold and the years ahead are dominated by technology. courtney ragan is in las vegas tonight. >> reporter: here at shop talk in las vegas, o hundredsf retailers, brands, tech startups and investors are coming together to bet big on the future of an industry in a period of rapid transformation. the tech presentations and
exhibitions are among the moste atte because it's not enough to just havet the bes products. retailers have to serve shoppers better wherever and however they want to shop. it's leading established retailers t start to talk to startups for options for services like faster delivery, eaer returns and august nlted reality shopping. >> it feels like this is a giant demo day with all of these tech companies are pitching the retailers and brands how they can make them better. >> reporter: bob' discount furniture announcing new technology allowing them tout trew furnishings virtually. macy's is already worki with a startup for virtual reality shopping. it's increasing the average furnitur value by 50 to 60%. if retailers canet consumers to shop online and in store the total spend increases. nordstrom forecast shoppers who do both will spend 4 to 11 times
more than shoppers who use just one. it's part of the reason whye they experimenting with physical ecommerce hubs that can't be done online. local stores in las vegas don't have inbe ven toriike a typical location but instead offer a point for online order pickup, alterions and return. co-president eric nordstrom hopes bridgingconsumer's digital and physical experiences will ultimately make shopper's lives easier, increasing loyalty and spending. >> we just keep lear again and again a i guess do what the customer wants. if the custome wants to g in and out quickly, there's a more convenientf waying that, it does pay off for us. >> reporter: meeting consumer's desire for instant access around the clock accessibility and fast turn around all now the norm has large retailers racing fill that need and quick. >> we look in hindsight, we don't think the strategic
choices or direction has beeof we think we've been too slow. we think weo need more agile. >> reporter: if there's one thing that tech startups need, it's speed. for "nightly business report" i'm courtney ragan in las vegas, nevada. if you're plan on going shopping, you are not aalone. thrage american family spends a lot more this time of year thanks to uncle sam. steve liesman explains. >> reporter: james aguilar counts on his yearly tax refund and this year he knows exactly what he's doing with his check. >> what do you want to do with is? this yea we're going miami. >> reporter: he's like a lot of americans. a new studyy the j.p. morgan chase institute takes anonymous spending from millions of chaset cardholders s tax refund is the biggest pay day of the year for nearly 1/ of households. >> we were most surprised to learn that the tax refund is the way people step up year to year.
they think of it as a year end sey incr what we find is it's really this tax refund where they reset dey rebalance their spending. >> reporter: theyo more than rebalance. the study found that spending spikes i74%the week after the check arrives in the mail from uncle sam. the average refund equal to six' we salary for the average recipient. >> i put some in savings and then ifth e's something that i need or my children need, i get it for them. >> people spend their tax refund differently than they spend -ttheir general dday spending and so we see much more emphasis on durables. they're paying down credit card debt. out morejust takin cash instead of buying services on durables and food. >> reporter: it appeaof because last year's tax cuts refunds might run lower but that's proving not to be the case. the number and dollar is running a bit behind, but about1/3 of the way through the filing season the average refund is bigger and that's good news for mr. zh egular and his tripo
miami. >> me and my girls. ereck the check. i gotus but it worked out good for us. >> reporter: for "nightly business report," i'm steve liesman. >> coming up, a hollywood drama. the movie industry's biggest director is takin on the company that's looking to change the entert. director steven spielberg wants to ban netflix from the ca . the legendary director of popular movies le e.t. and schindler's list plans to support a rule change that would prevent movies that debut from a screening service from attending the oscars.
we will talk about whether or not streaming is a missed opportunity for hollywood. nice to have you here, matt. welcome. >> thank you. mean, the obvious answer seems to be, yeah, it is a missed opportunity. would you agree wit that? >> well, i think all the studios have benefitd somewhat from netflix in terms of sellingnt t. they were the foundation for netflix's early success including the problem was to a certain extent they created a monster and i think that netflix has been extremely disrupted to the mid budget movie business, dramatic come dis, et cetera, i theaters. it hasn'tad that much effect on the avengers or high end anated movies. the genre of movies that the academy awards is generally focused on, it's been very transformative. >> what does this do if this le goes through and if steven spielberg is supporting that rule, what does that do to the
streaming bseiness per >> well, i don't think it makes it a whit of difference to netflix. i think they enj the critical acclai but the money from the box office isn't that important to netflix at this point. >> so what does hollywood need to do to either get on the bandwagon a partner in a different way with netflix than they have viously as you mentioned they kind of created the monster to a certain exont. whathey have to do to change? >> well, a number of these studios are pulling their contracts. disney, as everyoneknows, in particular the fox content layered on ishe most formidable i don't want to say adversary but more complements netf mx. warneria is doing the same thing over at at&t. the reorganization we've seen over the last couple of days. but i think the tall challenge
is realizing there's good content the pay scale.pped i think that steven spielberg can complain and certainly he ha more recognition in the broad publicth than any directors. that's not what ultimately is going to drive the buwhness. you look at in home, people are very acclimated to binge viewing tv shows. you have 4k tvs, 8k tvs. >> who k tws whatt will bring. >> the screens get bigger and bigger. there's certainly a social tpect of the theater experience that's always goibe there. i think you have to face reality and these windows are goi to get more and more compressed for all the biggest move veegs. matt harrington, thank you, matt. >> thank you. finally tonight, areou in the market for real estate? well, according to this listing on craig's list, you can get alest an entown in georgia for about the same price of a
typical home in san francisco. 37 parcels of property including a famous opera house, restaurant, a victorian hotel along with 40 acres of land are on sale for $1.7 million and that price is about the same as th median cost of a single family home in parts of san tancisco. wow. >>t does it for "nightly business report" tonight. i'm sue herera. we wanto remind you this is the time of year your public television station seeks your support. we thank you for that, ande'll