tv Nightly Business Report PBS March 8, 2019 5:00pm-5:30pm PST
>> announcer: this isne "nightl bu report" with sue herera hiring hits thebrakes the economy created far fewer jobs than expected last stmonth 20,000. is it a sign we've hit peak employment? building equity. if you're a meowner, you might be a lot richer than you were just a year ago. bright meet the entrepreneurs who say the future of retail is a brick-and-mortar store but with. those stories and much more tonight on "nightly business report" for friday, march the good evening, everyo, and welcome. the headline number was a shocker. 20,000 jobs created in february, well below the 180,000 estimate.
the gain innfarm payrolls was the slowest pace for job since december of 2017, but the unemployment rate did dip to 3.8% and wages ticked higher. job gwth in the two prior months was strong, leaving some to wonder if this is just a one-month aberration or a sign that the hottest part of the economy may be starting to slow. steve liesman starts us off tonight. this was a miss for the ages. wall street looked for a reasonably strong jobs report of 180,000 created in february. the real number, just 20,000. the wall street economists haven't been this wrong since the 8,000 miss in november of 2008. that is in the middle of the great recession. but rather than fearing the worst, most economists think the number is more noise than signal. >> this is abos internally inconsistent a report as i think i've ever seen. and if there are m ever ath where you want to wait until next month and see what happens, this would be ith >> job growt was low,
unemployment measured in a separate survey fell. hourly earnings wer strongly. so what's going on? one culprit could be a very snowy andold february. construction jobs fell by the government shutdown ended the month before might have played hav with the data. it might have been a snap-back from a really strong number in january. and every now and then, c data be an outlier to the real trend. the danger is this wasn't noise. >> i still do think the risk of cession is high for 2020. i did not as optimistic even if we g trade deal with china, that the weakness preceded the trade weakness andheir ability to stimulate is not as strong as it once was. >> we won't know until march if ther was right and pointing out a weakening u.s. economy or, as many t hope,s way off target. for "nightly business repo well,et's turn to luke tillie for more analysis of today's jobs number. he's chief economist at wilmington trust. luke, good to see u.
thanks for joining us tonight. thanks for having me on. > so what do you think, aberration or is something else going on? >> it's certainly an aberration in our view. it really doesn fit with the other indators thate're seeing in the economy, ys of businesses indicate they are still looking to hire. also the number of job openings in the economy is at all-time record highs. so what we see heres a little statistical aberration. as was suggested in steve's report, probably a little bitf impact from storms and the government shutdown. >> so you would disagree with those who say we've reached peak employment? >> yeah, i don't think we've reache peak employment yet. we still have a very strong labor market in the sense that those employers are looking for workers. really the limiting factor on growth is their ability to find them. e unemployment rate is so low that they're having trouble finding them and that's what's pushing up the wages to the 3.4% that steve mentioned that is now high for this cycle. thee are at a point where international monetary fund has
lowered its growth target the european central bank lord its growth forecast for europe. we've been hearing a problems in china and our own economy as well. so aren't we at a point now where you would think that hiring would start to slow at some point? >> we think it would -- would start to slow at some point. we don't want to be whistling bd the grave here. there are a lot of indicators that we do have a slowdown in the global economy. we're not disputing that at all. wee a slowdown in the u.s. economy from 3% growth i2018. wilmington trust thinks it's going to be just 2% in 2019. that still doesn't make this morning's job report very accurate. we still thi it was an aberration, but we are looking at all of the signals. business investment, consumer spending, the next jobs report to see if there is a weaker economy ahe of us. >> you're watching very closely participation from those in the age group of 25 to 54. now, grant that's a widespread, but why are they so
important in your work? >> there so important because they're a better indicator of what's going on in the labor foote. so a of people will focus on the overall labor force participation rate, but that includes the baby boomers who are retiring of their own volition. that 25 to 55-year-old cohort hass increased their participation adding millions to the labor force. t that i single most important thing going on in the labor market right now and ihe ing employers fill those positions. ngton e tillie with wil trust. again, thank you for joining us tonight, luke. >> thank you. on wall street the stock market closed out its worst week of the year just one day before the bull m turns ten. today that anemic jobs report did little to excite investors, as did newat out of china which showed a 20% slump in ports from a year ago. those economic growth concerns pressured stks. though the major averages finished way off of their worst
levels of the day. by the close the dow jones industrial average fell into points, it had been down more than 200. the nasdaq was douwn 13 and the s&p 500 was down 5. we also wanting to look at the transportation index which is now dn foren straight sessions, its longest losing streak since 197 there was some positive news on the economy out today. housing starts rebounded in january. they were up more than 18% on a rise in single family home construction. th followed four straight months of declines. and even though home prices have been cooling a bit cently, homeowners are still very much in the money. dianaic takes a look on a new report that shows a big rise in home equity. d>> reporter: strong dem for housing last year kept home prices surging, and that mea more homeowners are sitting on more cash in the form of home equity.
collectively, homeowners with mortgages saw their equity increase by more than 8% last year according to corelogic. that's a combination of value gains and paying down their mortgages, and it's a collective $678 billion, or$9700 per homeowner. tehomeowners in western s saw the biggest annual increases in home equity with nevad homeowners now about $29,000 richer. californians just short of $20,000. washington state, new york and florida also saw big gains. but there were losses. homeowners in north dakota, louisiana and connecticut saw their equity drop. rising equity also meant more meowners who were underwater on their mortgages finally came up for air. the number of homeowner who o more than their homes are worth dropped last year, but that numb is still abo 2 million. rising equity often results in
more cashout refinances or second home equity loans, meaning more spending by consumers who feel more wealthy. that could translate into bigger gains for the remodeling industry later this year, as homeowners take out more cash just to put it back in for remodels or upgrades. for "nightl business report," i'm diana olick inwashington. it's time to take a look at some of today's upgrades and downgrades. exxonmobil's rating was cut to market perfo from outperform at cowen. the analyst ces concerns over its investment strategy. the price target is $75. the stock fell more than 1% to $79.01. netflix was downgraded to neutral from buyt buckingham. the analyst cites concerns over new competitive threats and the departure of its chief marketing officer.et the price tas $382. the shares fell a fraction to $349.60. the cannabis company tilray was initiated with an r underperfoing at jeffries in new coverage. the analyst cites the stock's
valuation. the price target$61. despite the new rating the stock rose a fraction to $70 even. still ahead, looking for some value in your stocks? this week's market monitor has so food for though the united kingdom is scheduled to leave the european union is just three, we and still thes no approved plan that outlines exactly how that's going to happen. now, that has created a lot of uncertainty for many businesses,
especially those in the steel industry, which has been thriving. villa marks is in england for ui t. >> reporter: alex cross has spent most of his adult life around giant sbs of molten metal. he's the production director at summers fo. >>e how many peo work here overall? >> it's around 120people. >> reporter: summers produces ighly specialized steel products used in submarines, ships and across the energy sector. and at this family-owned firm that dates back to 1697, business is booming, despite brexit uncertainty. the steel sector here in the united kingdom has a long and proud history as a global powerhouse, but experts say that s european union membership in recent years has provided bigger benefits to stee i makers terms of propped-up prices and increased employment than to ahe uk industry. in the event of a no-deal brexit, the percentage of total
uk steel exports facing trade restrictions, including tariffs, could swing from 15% to 97% by the end of this month. gher shipping and admin costs could also total $92 million a year for steel exporters. she admits u.s. tariffs hurt her firm's finances but says a hard brexit could mean marketwatch harder times. >> steel prices i think would fall. the steel industry would suffer. summers forge i don't think would suffer. ik >> do you feel you've had a partner in government in a sense that's helped you plan? >> dno, i't think we've had the visibility that business needs. i think because of the way summers operates, we haven't felt the adverse impact of that. we've still invested, we've l recruited. >> reporter: firms with a weaker digree and cash positions in an industry that's already feeling the squeeze, no politician can promise brexit
.on't spark significant and for "nightly business report," i'm vill. a big move higher for big lots, and that's where we begin tonight's market focus. the bulk discount retail chain reported better-than-expect a earnin revenue. the company also saw same-store sales rise more than 3% for the second consecutive quarter. the ceo atriktributes the solid results from remo led stores and marketing efforts. it was up nearly 14% to $36.18. navastar missed on earnis but revenue beast foreca forks. they also had strong full-year guidance. shares fell 3.5% to $33.85. vail rrtort second q earnings topped estimates but the ski resort operator is lowering its 2019 guidance due visitingo fewer guests
its u.s.-based resort during the preholiday season. vail also, by the way, announced a 20% increase in its dividend and shares rose nearly 7% today to $216.55. citrix systems has been . hack the networking software company says it has taken action to the problem and that the unauthorized access was possibly done by international cyber criminals. they did contact the fbi and is cooperating with that agency's investigation. shares fell more than 2.5% today to $99.98. it is time now for our weekly market monitor, who likes food stocks. he says there is value in food, but it's all about picking the right company. this is his first time on the program, soe welcome kevin ent r, cochief inves officer. nice to see you, kevin, welcome. >> hi, thanks for having meas >> everybody got to eat, but to your point there are a lot of space.s in the food you picked three that you think will continue to perform well. they all have a bigfoot print
but conagra is your first pick. why? >> yeah, so conagra really is focused in a couple of areas. one is snacking and the other is frozen foods. so these are two of the faster growing areas within the food sector. they have leading bras like banquet, healthy choice, marie callender's. they just bought pinnacle foods which we think management, shawn connelly, will do quite a bit better with those brands, putting them togheher with own. >> another one you have, kevin, is hayne celestial. they're into everything from seasoning to yogurt. i justooked at a five-year chart. four years ago this was a $70 stock. today it's a $20 stock. they have a relatively new ce just started last fall. i guess you're placing a big bet on him. >> this is a bit of a turn-around play. they are focused on the natural organic market which is boeonly
about 80 billion. they're really focused on the right areas but need to restructure the business a bit. we think new management will be able to come in and d that. then they should get more than their share of the growth of that faster grong natural and organic segment. >> next is mondelis. it's an emerging markets play as well. >> yes, exactl the other two were a little bit of turn-around plays. this one is reay a high-performing company. they're in snking. they have cadbury, ritz crackers, many others. t 40% oir business is in developing in emerging markets. if you look at certain markets like india, their scale is really unsurpassable by other companies,ryo they have very deep roots in these markets op andwill propel both bottom line for years to come. >> so i'm curious, you're
pickingfood. is it because of the value you see or are these just cla defensive plays at this cycle in the bull market? >> i mean they should be relatively defensive in the scheme of the market, but that's not why em pick. theyery good businesses that have some interesting things going on with all of them that we think can serve as value the next couple of years. >> ifhe global economies are slowing down, is mondelis vulnerable because of the amount of sales they get overseas and from emerging markets? >> to an extent. s when y the emerging middle class in all of these emerging markets, one of the first things consumers do is buy bnded food and beverage products. i don't think that would be one of the areas that consumers would look to be cutting. they are aays subject to currency risk. they have a sizeable uk business if there's a hard brexit, so
that is a risk that's out there. >> kevin, thank you for joining us. >> thank you. >> kevindrier. coming up, retail returns to its roots wit a new kind of brick-and-mortar store. it's ton. the u.s. women's soccer team is t suing u.s. soccer federation. all 28 members of the wld championship team allege gender discrimination thatffected everything from their pay to medical treatment to travel they are seeking class action status so that past players can join. this lawsuit mirrors similar accusations made in a 2016 complaint filed by five players
with the equalsi today is international women's y, and what better time for marvel's first an alone female super hero movie to hit the silver screen, which it's doing thisweekend. a lot is riding on the success of this latest release. julia boorstin has more. >> reporter: "captain marvel" may have the super powers to turn around a strugglin box office, with the highest presales in aye ar. the film is expected to grosstop $150 million in north america this thweekend. would eclipse the $103 million that the other female super hero, wonder woman, brought in over its opening weekend two years ago. >> when you put f a womannt and center in one of these films, now there's a lot mor attention on it because the box office is so big. we're talking hundreds ofll ns of dollars in the global box office. d so "wonder woman" i think kind of kicked off that momentum in terms of this new era of super hero movies and captain
marvel is looking to continue that. >> reporo far have been good. tomatoes.ren rotten brie larson's character could drive or dampen interest in the four otherfi marves coming this year. up next, avengers end game and this smer spider-man far from home and fox has twome movies, dark phoenix and the new mutants. theater chains are counting on the super hero to ld a turn-around. the box office is down over 25% year-to-date. not even accounting for inflation, this year is the lowest grossing start to a year since 2011. after last year the box office hit a reco, bolstered by "black panther." >> anticipation is sky high. this is going to be a $100 million opener and it's going to put the box office into an upswing and kick off a 2019 that is gigantic for disney.
>> reporter: studios and theater chains alike are hoping this weekend will kick off a box office turn-around. the decline so far this year s fueling conce that the rise of streaming alternatives is raising the bar for thecr singly pricey trip to the movies. for "nightly business report," i'm julia boorstin in los sngeles. retail store continuing to close in droves.n more t000 are scheduled to shut their doors this year. if you're a landlord wondering at's next, you might want to pay close attention, because a trio of new york city entrepreneurs got the bright space billing a itself as the world's most inte shopping has always intrigued tals. his mother dressed store front windows in israel and he's inspired by the grandepartment stores of the 20th century. >> it s always about you can stage anything that you want so there's always a lot of magic. >> arriving i new yorkack in
2012, though, he found the store fronts tlacking. first thing i noticed was where's the magic? none ofshose thi that me and my friends are buying or interested in are there. >> the magic may have moved online. new products, cheap prices, but few digital startups have the time or the money to find and open physical stores. o he and his team opened schofield's in o decemberf 2018. it's a gallery of pop-up stores and works of art. yes, that's for sale too. >> we want to offer you it flexib you don't have to commit to 15 years, just come for three months or four months. you don't have to commit to a different store size. >> pop-ups can cost a quarter of a million dollars but schoeld's is renting pacspaces for $6,000 to $8,000 per month.
they took a risk on a lease with a landlord willing to try something different. >> innovation in retai is something new. they understand thatomething new needs to happen. you can only walk in here and ge like to think it's dead but it's not tdead. >>he first floor is home to wellness products like frank body, a line of australian coffee scrubs. >> you can try all of them here. d then literally press the button to vote. >> they have sold a million ru electric toothes online, but it wasn't equipped to find a physical space. >> you have to think through all theperations and logistics and then start from scratch to build that experience. withfi scd's of course you get a helping hand the whole way. >> it's a problem hunt has seen before. he was employee number three at eyeglass maker warby parker which began online and now has about 90 stores. we didn't have that ability on the tea and w actually had
to hire for it. i want to take that fear out of the decision for the brands that ic'r working with. >>l is leading the hunt to find and design more retail spaces. >> it all comes from the consumer world and i'm from the real estate world. both ofs recognize the same problem from different sides of the busine. >> first, hoeld's will expand upstairs. later this month shoppers will get access to a slide the third floor to the second. on the fourth floor an event space and an outdrterrace, each a nod to the old department store magic. >> it's ang big t to try to walk in the footprints of giants like that. but it also ges us a lot of power when we look ahead. >>ui and thating in greenwich village was home to the first animal hospitaled in e unstates. so the co-founders like to think it has good karma. they are hoping to begin work on
sites in other major cities later this year. before we go, one final look at the day andhe week on wall street. five straight down days, finishing with today down 22 points on the dow. the nasdaq was down 13, the down just 5. for the week down 2% plus. e wor week of the stock market in 2019. >> wow. that doesni it fortly business report" tonight. i'm sue herera. thanks for watching. we'd like tohi remind you is the time of year your public television station seeks your support. >> i'm bill griffeth. thank you very muchsuor that ort. have a great weekend. .