tv Nightly Business Report PBS June 4, 2019 5:00pm-5:31pm PDT
♪ this is "nightly business report" with sue herera and bill griffeth. ♪ turnaround tuesday. stocks rebound and have their second best day of the year after the fed chair say it's ready to act to keep the economy growing. fire and ice, why the hottest part of real estate might just have the coldest property. going under ground. a chinese subway carmaker is making inroads here in the u.s. and some lawmakers are sounding the alarm. we'll give you a look inside t company, what it means for american jobs and even national secu. all that and much more tonight on "nightly business report" for tuesday, juneth. >> good evening, everyone and welcome. stocks surged to their second straight stageye of th with
all indexes rising 2%, the catalyst and the and the perceived ever so softening tone of trade sepgszs.n >> the frict between the two sides should be dealt with through talks., with th investors were in a buying mosd. the dow 512 points to 25,332 wiping out yesterday's lossnd the s&p 500 added 58. bob pisani gets things started tonight. >> stocks started and ended in rally mode after six straight eks of declines andwill have till session yesterday the dow surged more than 500 points having its biggest one-day gain since january 4th. there were a combination of asons and federal reser chairman jay powell said the fed is closely monitoring trade and it would act appropriately to sustain the economic reaction, and also,adasing trade tensions
and trade disputes should be resolved with tax and resolving the mexican tariff on mexico. not surprisingly the most oversold is the transports, the semicors, metals and mining and retail all bounced the most today rndail had the best day in five months an that doesnn the sector is done fueling results of tariffs and if you want to see the results of a trade war on stocks, look what ha to tiffany. the company noted same-store sas were down4% which they said was due to far fewer chinese v touristsiting the united states. a lot of damage elsewhere has already been don b transportation stocks were down, double digits this quarter on these concerns about slower global growth. for nightly business report, i'o pisani at the new york stock exchange. in addition to chairman powell's comments there was more speak about what the economic policy might mean for the fed's
monetary policy. steve liesman is in chicago tonight. ♪ ♪ f >> two t officials speaking in chicago today ewsuggested that coming tariffs from the trump administration could change monetary policy. here's when the vice chair told cnbcien the inte >> today the tariffs put in place in the economy have haa small effect in the aggregate and the others would agree with that consensus as we move ahead and we consider potentially more tariffs and potentially retail wragz and that potentially has a oure noticeable effect on the economy and we have to take that into account. >> and they're not necessarily inflationace because the p only go up once and stay that way. so he said he's more inclined to ddress how tariffs can weaken growth. the fed chairman jerome powell also saidcthe fed would if it needs to. >> we do not know how or when thesessues will be resolved. we are closely monitoring the implicatio of these developments for the u.s. economic outlook and as always,
we will act as appropriate to sustain the eansion with the strong labor market and the inflation near the symmetric 2% objective. >> this is all potentially good news and not only did stocks rally sharply, but the chance of a fed c rate shot up 60%. ofe traders took a flyer out a possible june rate cut and that seems early and the idea that the fed is headed for at least one rate cut as a result of tariffs looks like a gd bet after these fed officials spoke. forty inially business report, i' steve liesman in chicago. >> president trump was in london again today meeting with outgoing prime minister theresa may and on the agenda, brexit and you guessedit, trade. villa marks has more from london. ♪ ♪ after all of the pomp and pajencery at buckingaym palace moight. it was time to talk polits on tuesday morning as president
trump traveled to meetings inon centraln apparently prepped to do business. >> our nations have more than $1 trillion invested in each other's economics. the united kingdom is america's largest foreign investo and our largest european export market. that's a lot of importance. as the uk makes preparations to exit the european union, the united states is committed to a phen trade deal between the u.s. and the uk. >> there may was one of the first world leaders to meet with the newly inaugured president trump, and he will be the last world leader to visit her here in her office in number 10 downing street. she's failed to get her brexit deal through the britishia pant three times. she looks to be trying to position the uk for a favorab trade deal with the u.s. >> i think that this is something that your folks want to do, my folks want to do and we wante' to do and going to
get it done. >> the transatlantic work day began at this breakfast roundtable with businessears with the special relationship in attendance. the conversations abocomic cooperation then continued over lunch at the prime minister's official residence. >> shame on you! >> whi nearby thousands of protesters jeered the president's presence in the british capital, and at a joint press conference at a soon to be ex-prime minister brushed off criticism and insisting that a longstandi intelligence deal could survive huawei equipment in its new 5g network. >> we're going have absolutely an agreement on huawei and everything else. we have an incredible intelligence relationshipnd we will b able to work out any differences. i think -- we did disss it. >> trump had confirmed his intention to imposeariffs on mexico starting next week. >> think it is more likely that
the tariff goes on and we' be talking during the time that the tariffs go on and it will be in ma c >> hernter park who has paid a sep price there were doubtless some relief that the president's words for her have remained relatively warm. for "nightly business report," i'm dylan >> tariffs are top of mind in toyota right now. the automakerte repy has told its u.s. dealers that the imports that president trump has threatened could cost suppliers between $200 million and $1 billion. toyota pointed out that 65%f s tacoma pickup trucks sold in the united states in 2019 will be imported from mexico. and those higher costs on autos could also trickle down to the consumer in a way that probeely has not given much thought. your insurance coverage.sa co brewer explains.
♪ ♪ >> when a driversh c his or her car it goes it a repair shop and a bill sentce to the insur company. among the most commonly replaced items, windshields, and their prices are up 10% because of tariffs. >> countries don't pay tariffs, consumers do. >> steve caliper owns nine centers in new jersey. he's seen costs for autoparts soar. >> the real burden will be on the consumer. they don't have choice to fix a car. the car will either work or not. so if you have this pt and you have a 25% tariff increase that part had cost $200? bingo, $50 more. >> last year the u.s. iorted $158illion in autoparts and tariffs are now driving insurae price higher. >> with automobile insurance we are already paying increased costs for replacing or repairing
motor vehicles as a result of the china tariffs. > an estimated $3.4 billion in additional insurance payout, now president trump promises 5% tariffs on mexican imports starting monday and that they'll keep going up as long as illegal border crossings are an issue. >> mexico is theou largeste of imported car parts, accounting for almost $60 billion or nearly 40% of imports last year. car insurers are bracing for as much of a $5 billion impact depending onow high the mexican tariffs go, and then there are the secondary costs. whether a car is repaired or d totaledends on the cost to fix it. more, pensive parts means more cars considered totaled. replace am vehicles arelso mo expensive because of tariffs and mechanics lose the repair finally, the tariff may disrupt the supply chain or cause shortages apart. >> it means consumers can't get
their csepaired as quickly as they otherwise would which means they have to have rental cars longer. >> and one additional rental car day. who picks upt tab? you might think insurance companies, but insurance is a pass-through industry. increased costs are passed on in the form of higher premiums. just one way tariffs create a bumpy rore everyone. in flemington, new jersey, contessa brewer, nightly business report. up next, the hot trend, investing in cold. s colde new hot in real estate. that's why i'm standing in front of a giant freezer unit. i'll explain coming up on "nightly busin♪s report." ♪ ♪
♪ ♪ >> the growth of e-commerce has increased demand for warehouses exponentially and one subset of that real estate sector is dly heating up even though you might notescribe it that way. diana olick is here to explain. she's in jess up, maryland tonight. ♪ >> cold is hot if you're in the warehouse business, that is. cold storage warehouses and distribution centers are suddenly in high demand. >> it is the pea pod and it is theamazon. >> the new food delery services driving it literally from the warehouse to your home and small now, but growing quickly. >> and it's 2% or 3% on goods and groceries are bought online and wexpect the space could explode as much as 13% over the next five years because of thet
peneation of the internet. >> it is also the farmo table and organic trend. fewer preservatives in food m requiree cold storage. >> change insu conmer prefer renses is that they want to eat cere fruits and vegetables and less ped foods. so when you have fruits and vegetables they need to be fla frozen and transported throughout the country to the end user and that is definitely taking anti in demand for this space. while mainstream warehouse nstruct isgrowing, there is still a limited supply of cold storage real estate that makes it much more valuable. >> if you look at the capacity in the major mket there's not much. >> it is the only publicly traded tem warehouse owner in the u.s. today since going public last year. its stock is, well, on fire. th so we're seeing a lot more investors come int space and when i say investors there are the dedicated real estate vestors that only buy the five major food groups and many of
them sayil i w do the niche sectors like cold storage. >> because as it grows the perishables are poised to profit and so are those investing in cold prope for nightly business report, i'm diana olick in jessup, maryland. uber and lyft get a lift from wall street today and that's where we begin tonight's market foc19. firms initiated coverage on uber's struggling stock with analysts saying it's a buying opportunityor their clients. meanwhile, citigroup initiated lyft a a buy. it likes the concentrated focus in the u.s. and canada. 42.75 and rose to lyft shares were down a fraction to 59.17. french automaker renault is now delaying a decision on the potential merger with fiat chrysler after an activist hedge fund wrote to renault's board opposing the deal that the
proposed $35 million rose, it rose t 13.33. box shares fell following last ght's results which showed slightly better than expected earnings a a full-year revenue outlook. the company blames longer than expected duration of closing deals with new larger clients and that comes with s longerre cycles. it fell more than 4% to 17.18. mattel and joining&p the 500 while mattel will join the s&p mid-cap 400nd the move will be effective before trading opens on friday. it fell a fraction, and mattel's stock jumped for the hello kitty brand rising % to 10.78. after the bell omsalesforce beat estimates thanks to an increase of customers to its flagship sales cloud business. the company also raised its full-year guidance and the stock initially rose in after hours trading and closed the rular
session up 4% to 1150.81. >> the oil market managed to eke out a gain with the trade tensions and domestic crude settled at 53.49 a barrel after a month-longosing streak that threatened to push prices into bear market territory meaning a high. >> joining us isoh kilduff. >> this slide we saw during the month, this washe more about expectation of slower growth around the world. so demand, theoretically, we go down. is that the idea? >> that'sagight. the d from the u.s.-china trade war on the asian economies across the board, bill, really put a damper on the outlook for crude oil and gasoline and diesel fuel demand as we look forward. you have korea flirting with going into recession and south korea, that is. japan can't get out of its own way and all of the rtim export numbers really disappointing and a month in and
month out for china, japan and south korea and german too, is the other big loser because thoos the biggest market, the germans and all of that are the key demand centers are taking the biggest hits from this. >> it comes when iran has sanctions on it so weir not seeing oil from that part of the world and in addition to tt, we have venezuela which is in a political crisis. so it's skiekind of a interesti juxtaposition. >> there is a complacency in the oil market right now. e differencemaker has been theat united ' rise to become the number one oil producer in the world. our 2 million barrels a day is most acting like a firewall over hideously frightening development in the oil market like clamping down in iran and venezuela's oil output. >> are we going back to the lows we saw year, you think? >> saudi arabia is working hard to curtail pduction and output
and trying to hold together the opec group and russi to cut supplies to the market. it should have something of a stabilizing factor.ou oby, we're still in a very dangerous neighborhood and anything can happen at any time if the iranians do act out and they are getting squeezed mightily right now, bill, then we would be in a different kettle of fish, but for right now the low that we hits t week will hold and it is $2 a gasolineor the folks. i don't think we'll get much below that. and the problem is that all of the geopolitics can rear their ugly head. >> john kilduff wit capital. >> more collateral damage in the tread dispute between the u.s. and china. >> pawns in the trade war, the fate of nearly 360,000 chinese students whotudy in the u.s. issueser threat as china a warning coming up on "nightly
businesseport." >> the trade dispute between the u.s. and china is spilling over toourists. the chinese government has warned citizens traveling to the s. about harassment by chinese tourists w points of entry and a second warning was issued highlighting the risks of shootings, robberies. >> the govern am has issued another warning to its students and as robert frank tells us, it could cast a chill on one most important economic drivers fo u.s. universities. he's at nyu in manhattan. ♪ ♪
>> the chinese gov nment hitting back against the u.s. yesterday with a warning to the more than 360,000 chinese stents studyin in the u.s. china's ministry of education saying students are having trouble getting visas to come to the u.s. and that they should, quote, strengthen their risk assessment. >> chinese students contribute up to $14 blion a year t universities and colleges across the country and since they paid full fare, universities have become highly dependent on those dollars which also help subsidize u.s. student tuition, but there are signs that students and their money are ifting to australia, canada and the uk which are more welcoming. with u.s. companies becoming more reluctant to hire chinese grads especially for sensitive tech and engineering jobs, a u.s. degree nr lon means a path to a job. >> it's helpful for the u.s. t have people in china help understand the united states and thd people in the uniates
who understand china and we'll have to deal with each other for decades to come and it is much better that we know eaer well and we don't use students as pawns in a larger issue. >> here at nyu which has the largest number of international stud in the country there are nearly 9,000 from china. costs and tuition here can run up to $25,000 a yer and l many universities they're hoping that the trade war ends quickly. >> for "nightly business report, i'm robert frank in new york city. >> and finally tonight, the tensions between the u.s. and china has put a spotlight on the world's bgest rail car manufacturer. it's a chinese company and its bidding onacts in some of the biggest u.s. cities right now. so for some, this is anmp e of the balancing act between economics and natnal selurity. ons mui takesside the factory in springfield, massachusetts.
♪ ♪ >> these are the newest rail cars for boston's iconic rail system, the in >> this t is almost ready to go. >> yes. >> they run along spngfield, massachusetts. >> the first one is scheduled for delivery this summer and washington wants to hit the brakes because the company that makes them is from china. >> it is a state-owned communist of china owns the company. >> cr is indeed owned by the chinese government and it is the biggest manufacturer of trains in the world and our cameras got a rare look inside its first factory in the u.s. >> this is the shell as we receive it from china and from there, the components over here are what we'll be installing. >> interior lining is primarily the chinese and the wall panels and the air ducts and we have a door system from vapor which is in new york. >> in addition to boston, crrc
has won contracts with philadelphia, chicago and angeles totaling more than $2 billion. >> crrc -- crrc underst ud that thted states is a growing market in this industry also it is the third biggest industry globally. th united states is a market that provides the most operation and the most competition. >> the critics of the company say it isn't playing by those s rules and the because it's backed by beijing it could offer these cars for half the price of the competition. >> it' bidding on them at impossibly low prices. ultimately g this isng to be less competition for transit commuters and for transit agencies which will mean it's going to be a worse deal at end of the day. >> in washington, lawmakers on both sidessl of the are sounding the alarm, calling the company a threat to national
security. >> china in particularossesses sophisticated capabilities and it does have a track record of creating economic espionage. >> i really do believe that while wesleep, this country's plight. >> and imposing a ban on doing business in amerpoa. >> the p of the bill is directed to make sure that american tax dollars are not used to support businesses from china that are being subsidid by the chinese government. >> at the factory, the company says it's creating u.s. jobs, hiring unionized workeruyg u.s. materials and even paying u.s. tariffs, and it says that passenge have nothing to fear. >> safety, number one. functionality, butafety is most important. >> for "nightly business report" i'm ylanmu springfield, massachusetts. >> the dow rose to 25, 332.
the nasdaq wiped out yesterday's loss and the s&p 500 added 58. >> and that is the nightly business report forilonight. i'm griffith. we do thank you for watching and we'd like it remind you that this is the time of year your public television station seeks your support. >> i'm sue herera. we thank you very much for that support. we'll see you torrow. ♪ ♪
woman: this is "bbc world news america. is made possible by... the freeman foundation; by judy and peter blum-kovler foundation, pursuing solutions for america's neglected needs; and by contributions to this pbs station from viewers like you. thank you. jane: this is "bbc world news america." reporting from washington, i am jane o'ien.