tv Nightly Business Report PBS September 27, 2019 5:00pm-5:31pm PDT
thiss "nightly business report" witgr bill feth and sue herer trade threat. stocks hit a three-weelow on report the white house is starting to consir some curbs on u.s. investments in china. market monitor, our guest a five-star fund manag with a list of stocks he says could go up as muchps 25% over the next year, even in this i uncertain market. pinot or pot, california's established i vinyards are a battle with marijuana farm and both say we'd andnd wine do not mix. knows stories andow more tonigh on "nightly business report" for this friday, september 27th. and weo bidou goo g evening, everybody. and well just when it looked like septeer was showing
uncharacteristic resilience, stocks turned lower for a second straight week. the market slippedoday ong dwindl optimism over trade and because of some tepp i had economic data which heightened concerns jbout growth,t as world's two largest economie remain embroid in the trade war. the dow fell 70 points. we're at 26820. nasdaq down 91. and the s&p off by 15. as i mentioned, all three major eeerages were lower for a second straight week. now today there was yet another turn in the u.s. chinaelations reports that the white house is in the early stages of considering limits on u.s. investments in china. although it's still not clear how that would play out, it did pr shares ofome cheenz companies like alibaba, jd.com, and baidu. eamon javers starts us off tonight. >> markets reacting early friday toeport that the white house isis lookingki into measures portfoliog u.s.
investment into chinese companies. now, i'm told that that reporting is in factaccurate. but there are a couple of caveatn this story. one is that it's not clear where the administration is going to landnd that is there are a lot of different oions underio consider and the other is it's not clear when the decisn would ultimately be made. e idea here is investor protection. that is americans are investing in chinese companies, often listed onmerican stock exchanges. and it's not entirely clear the chinese companies are always what they are purported to be. t what could this effort look like? made a prem that might be the basis for any white house action it's called the equitable act. you can see the sponsor here rthe k poi under this rubio. proposal are the u.s regulators would have access to riew audits for chinese companies and be able to delist firms that don't comply with american standards and also to ban new listings if the audit reports have been withhold. one of the sponsor marco rubio t
had thissay about the bill. >> the fundamental question on this and on various topics with regard to crdna is how come this case those companies ms in publicly trudied -- why don't they have to meet the same standas as american companies have to meet o other companies have to meet. >> officials her not abl to really put any kind of scenarios on this. where this is going to end up. but theyo say the measuressre under discussion here at the white house. for "nightly business report" eamon javs in washington. despite today'sdecline, stocks have been fairly resilit in seember. so what's next? john trainor i chief investment officers at people's united advisers. >> hello, thank you. >> you say this a tale of two septembers getting ready to close out this month.. how so? >> correct. were talking about this this morning on our investment call, that august was rlly -- really had the turmoil that you would normally see in september. soe really thought we had an
early september last month. but wh theil tur that we have seen in the market, the market we saw today, it looks like we may be having that normal- dsh normal volatility in september that wehoug we had taken caren of in august. ll and we're not finished yet. the is a l so come in the month of october, right? >> absolutely. tuesday.earnings season on you have the 70th anniversary of the birth of china. so there is a big celebration in ina. thare a lot of things going on. and then. >> october. >> excuse me. >> gahead. i was -- but brexit is a big one right now coming >> that's right. the brexit. you have a lot of headlines that will keep us on o our toes in october. >> so have you made any changes to your p ptfolios or clients' portfolio given the fact tt w are at a time of yr which is f notorious volatility? >> you ow, we made a cha that we're really spending time with our clients discussing.
sie june0th of 2011 and our model portfolios, we have bee w overth equities we told our clients to be overwgt equities weeks we hads in the last few takenhat back to neutral. we still like the mechanic and want you to be invesd but we said now is not the time to be overly aggressi. 're dialing back risk in portfolios. >> where did you put that money? >> we actuay put it into short-term nds. we were debating moving ittnto kp but we said short-term bteds two to tee-year bonds is where we put the cash >> we will be watching. thank anu, john. have a great weekend john trtrnor j i people's united advisers. >> thank you. >> to the economy, now, orders fo long-lasting durable goods rose slightly in august.s but busin investment fell a second straight ponts month. reflecting concerns other the imsct of trade tensions.
according to the commerce department durabab goodsou said 0.2% and consumer spending continues to slow. spending barely re in august. and july's report revised lower. consumering of course has been the one bright spot on the especially during the second quarter. >> wells fargo names a new ceo ending a six-month search. charles scharff motivates to wells fargo in october with a focus on restoring the bank's battered reputation. >> we foe we have a series of regulatory issues thatry we nee to complehe work on. and so thais clearly the priority. it been the first priority. and we're going to make sure we don't miss beat on that. it's clear there is a huge amount of work going on and oenl hopefully i'll be additive to the press of moving that pour. >> the ceo announcement sent the stock high ner today's trade
attention session. >> gey's c will testify on capitol hill next month. in will be denniss muilenburg's first hearing since the two fatal crashing involvi the 737 max jet. bogey is facing several investigations over the development of the aircraft and preparing to submitare t fixes for the plane. the 737 max has been grounded since mid-march. it has been a big year for itial public offerings. but a funny thing happened on the way to the public marmets. ip s met with success. others faltered. dedra bosa separates the winners from the losers. >> there is technology m companies, zvideo, software behind video confere aing. pinteres sobering network and crowd strike a cybersecurity firm working in the cloud. these names on other so kuld called pure play tech companies have seen successful inial public offerings this year. re is another class of ip. ohs in year that are getting a they call themselves tech
start-ups but skeptics they say otherwise. >> we look we t theed we imt po you saw regardless what they said and the story they weaved they wer in a real esta business that had its amount of ril to it. you had is i somewhat limited path to profitability. >> there is work, real estate as tech. uber and lyft, transportation as there is even dentistry as tech, these names seen as less pure plays on technology arelso highlyunprofitable and not received well by public mart investors. >> you can't just say, okay, the pichlt po switches them out because it hasn't worked for uber. people don't believeon't the coy can innovate. >> peloton fitness ac tech stumbles in the ipo and endeavor a groebl entertainment sports and content com cny bills itself as a platform shelvedt' p ip
entirelys the ipo parade stumbles a double standard emerges in the market. investors are skeptic of less traditional technology start-ups. the question is will the rough ride this year affect the sectorer as a whole? for "nightly business rept" dedra boss an san francisco. >> look let's look at the upgrades and downgrades. shares of textr ients. upgraded to buy from neutral at bank of americanc merrill the analyst cited the market share feignsens gains and stronger free cash flow.w. the stock fell action to 7.14. match group upgraded to outperform from line at every core isi. the analyst cited the coany's investment and near-term strength in the dating app tinder. the stock gained% to 72.41. ebay was dograded to market perform from outperform at wells fargo.
the analyst citesoche s valuation after a nearly 40% gain this year. stockice target $$45 the fell more than 1% to 38.37. box downgraded to under weight from neutral at jp morgan citing intensifying competition among other things. the price target is $15. the stock dropped 6% to5.96. still ahead, house flips is a ris business. even riskier. g♪may be getting ♪ ♪
alth officials say they doept know exactly what caused the more than 800 vaimg related illnesses that suddenly appeared ararnd thet country. here is w wt they do know. control said that a number ofl patients became sick after using vaping products thatin con the marijuana derivative thc. one particularroduct is sol der the brand name da vapes thcd officials recommend staying away from all vaping products while the investigation continors. cala is known foror many things, including its wine. which is a big par of the state's economy. but grape growers are facing ar ma challenge. fellow farmers whorow legal marijuana. jane wells has the story from california. experiment's great with legal marijuana is running in unintended consequences. especially in santa barbara county whe avocado groves butt greenhouse sees f flowers.
>> we have 80 years of stigma to normalize the astro. john is a building a 44 acre cannabis kbir in prime wineco any in a countyn handing out morn a third of the state's total growing permits. that surprised some traditional farm zbleers there is one, two three four projects right there. >> all of the money. that's the only exheation. >> and here is the bottom line here on t money. the local university estimates the value of the wine grapevines to santa barbara county are $120 million you lock at the white structure there. there is cannabis in there. estimating that is worth $180 million on less land in faster time t two problems popped up. the first is theth odor which c be strong in places. some vintners are afraid it coaffect the taste of the grapes toe there is no proof of that. bioscientific odor control.
>> autumn shelton spent a $10 oh 0,00p a odor control device. >>s in a great crop. >> the second issue, pesticide, cannabis by law can't have any pesticide rest two due on it growers areftherps are forced to hand spray or lose use less effective means if pesticide drift. >> probably down two thousand to $4,000 per acre in cost in lost quality and the cost of having oto do it the way we did it. >> some farmers on both sides are trying to work together to find solutions without lawsuits. >> everybody wants everybody everyone to be successful. no one wants to hurt anybody's business. i think in large part, the agricultural industry is either indifferent or kpoited about seeing a new crop come in. >> not everyone is excit. >> it's going to be a giant legal battle. nyou know, i guess the end the lawyers wil win. llbut you know we' fight it
tooth and nail, fight to the end. >> just the latest sign thatgh hopes for lal cannabis in california have so far been an bit of buzz kill. for nightly business repo , jane wells, bulten, california. >> fiat the chrysler settles with the s.e.c. where weegin theus market f with the auto eskerr agreeing to pay $40 million over chat misled investors on how many new ach month ire sold the u.s. the s.e.c. alleges that the company falsely reported a uninterrupted year over year sale growth streak. but wheneve that streak was in jeopardiy the company dipped into o aoo unreported sales referred to as the cookie jar accord according to the allegation to keep the streak going. part of the settlement chryslertlid not admit or defy shinsoing and fracture fell a fraction. in another s.e.c.he settlemt al life is paying $20 million after they were accused of misleading investor how it
coensates sales representatives in china. the company also did not admit or deny wrongdoing. the stock dropped a fraction to 38.30. then drug maker mylan settlewood the s.e.c. paying $30 million for allegedly failing t p discloential losses rereted to a civil investigation into whether it overcharged for its drug treatment for allergic reactions. commonyou can tell a theme with the s.e.c. settlements, mylanan did not adt or deny any wrong ing. shares slipped more than 2%da to 1929. >>oyota and subaru spanning th partnership to jointly develop vehicles as part of the deal each auto maker will buy stock ihe other. toyota will raise its stake in subaru from 17% to 20%. it's not clear how big of af stake subaru will take in toyota. toyotael shares f 1.5% to 136.28. hedge fund d.e. shaw is
portedly taking a stake in emerson electric andri planningo push for significant changes, including a potential split up. emerson is known for the process automation which helps power plants and factories in areas like minin and cement. both d.e. shaw and emerson declined to comment.ri emerson ele shares rose nearly 3.5% to 66.40. time for the weekly market monitor. he has three stocks that he believes could rise 15 to 25% over the nextier. this is his fst time on nightly business rortus and we welcome t tmas plum, the president and portfolio manager of plumb funds thank you for joining us. >> thank you. >> we start with the digital payments company square something of a fallenual. last yearla $so 0 stock. lsday around $60 what do you think pro the gain you are looking for. >> well, i thinkthe merch volume has been something that's been an issue for them. but when we look forwardwe they have a lot of non-financial
transactions add-ones to services and looks to us like it's botmed out and that when we still see a company with 30 to 40% revenuewth we think it's a great opportunity, market has given us a gat start. >> next on the list is constellation brandnd you like it for a variety reasons but also because they're investing in the future with utr canopy growth, which is basi llyst the lar cannabis company in canada. >> well, t they've shonet they've been able to execute ever since they got the u.s. rights to the modelo family of beers. the premiumization of wine and ng that they've been executing on, branding. they've been spending r & d with cannabis. and it looks like thedve a good volume increase on the core products re. andre vechg for the future. as we cannabis becomes legal like the last story showed.
>> right. the thirdne exact sciences, started the out at $120.sorts. now it's at $90. they weren the news thi week i know. why do you think the company right now? >> well, there is few things that are asan unple as having an coope, the kbold staard for colon cancer. it's slow growth and easily treated if found early enough. this company with t dna stool-based test, you can test it at home. and you don't need anesthesia. you don't need invasive. you don't needo through the discomfort of preparaon. andra it's expanng the number of people willing to go ahead and get a tes t detect this terrible danceibleancer they ha grown 70% a year. 70% this year. we think there is a lot of ahead
of them this wokes you said they have approved for people 45 years and older. instead of 50 years and older. it looks like to us it expanded the potthtial market by over 20%. >> all right.oo very tom good to see you thank you for joining us tonight. >> thanks, bill, thanks, sue. thomas plum with thelum funds read more about his picks go to our websi at nbr.com. >> it's getting tougher to make money flippinghomes. the competition is heating up with home prices. and that's why f esper are borrowing mor money to doit. is that a risk to the mortgage market? diana olick reports from maryland. s man eects to fli about 15 homes this year like this in a pricey maryland neighborhood. >> we'll rehab the kitchen down here through the hallway. >> there are very few foreclosures oh or sfdised
properties nationwide to rehab or resell for flippers like thir investing in pricier older prerties usingore financing mortgage or private lending. >> it's more to puce a mortgage because you can get leverage. can you do more deals ifou borrow money. >> about 40% of flipped properties in the second quarter were bought using mortgagesatr priv lending. substantially lower than the 68% share during the height of the housing boom inbu005. the dollar volume of today's purchases is up a 3ually to nearly $8.5 billion according to am data solutions. that's the hig level the end of 2l6. banksend to flippers and fannie mae,ac freddie m pan the fha back a limited number of inveor lone loans. but he says big banks ban are t. >> any will are roooo being fog are the two wage earn are or income from a easily sourced job for example. they can verif income.
they know you are good for the loan. >> he goesom tonity banks which b can interview him personally and better understand the rwriting on investor lone loans is general is stricter n than it was during the last housing boom. there is no such thi as no dock no down payment loan banks have been burned. >> lenders are clearly aware they want return on the mortgaga lendin well. given the price ireases with less chance of price decline, given the h singshortage, i think it's a little safer environment. but foreche market toe and both lenders and friendshipers apparently with working it out. >> the housing market is stronger today wit with low mortgage rates and rising home prices. if the economy turns weaker and no longer be aafe bet. for 9mmusiness report, diana olick in maryland. >> coming up, the fight for streaming dominance heats up. and netflix' story line is about
a turn. ♪ food delivery company door hacked. been the company says that nrly 5 million customers delivery worker he is and merchants had person information exposed. the breach happened in early may. door dh blamed it on a third party service provider and said that once it was discovered it took immediate steps to block further access and impd security. the internet sector contributed more than t$2 trillithe u.s. economy last year. that's about 10% of the nation gross domestic product. the study was done by the inteet association.
the fourth l lgest in the u.s. economy. righ behehd rl estate, govern nt a manufacturing. >> it is a plot twist in the spider-man saga. disney, marvel aar sony have noo ed differences they will team up once again for a third spider-manovie. last month recall the t two companies ended the relationship over r fancing andalty issues. but according to reports today, sony will now pay disney a larger cut of revue from the next spider-man movie. sony owns the rights tosp er-man, disney owns the rights to all the other mvl superheroes. asrvel's work orh the l two spider-mans geneneted $2 billion worldwide in box office revenue. it's a critical movement for netflix. subscriber growth is slowin as competitcreases. and the stockck has lost about % past year.e over the better compete, the company decided to make a big investment in big name tvrs produ to create ariginal content.
and as julia boorstin reports, netflix' strategy is being put test. >> netflix is hopg paying big tv cators big bucks will help it compete with all its coming ri als. >> yourmbition frightens me. >> hit tv producer ryan murphy launches on netflix today. it's the first product from the streamer's recent spate of deals with tv creors. reviews so far are not great according to rotten tomatoes. but the big question is whethere it generates positive buzz to draw new subscribersers andth kp . >> the key is how many hit shows they can create. think global hit shows like stranger things with ryan murphy this f they can get one or twoit >> netflix lured murphy from whereee he created american horror story and crime story and nip tuck. $3 ohh million for a five him opinion year exclusive deal. considered the priceyest deal in
tv history netflix is also making exclusive deals with other top producer. game of throwns david benoff and db white paying $$200 million and netflix has a $soo million with shanda rhymes. behind the hit scandalnd "grey's anatomy." the fir fruits of the deals lambing today with the litician comes asticietflix prepares for a range ever new rivals. th apple tv plus and disney plus launching in november. netflix shares a now down more than 30% from the all-time high a concern abo the rivals as ll as netflix losing domestic subscribers last q qrter. the firstecline in years. the most important metric by far is subscribeny.rs the com is increasingly talking about hours of content consumed and how many people ard viewing a particular show. but what really matters is how people talk with their wallet. that's if they s on the service or not. for us we're lking at subsibers as the most important metric by far.
>> while>> netflix doesn't repo ratings we see in ceo reed hayesing seeve if it d viewership or subscriberbe additions and see what the other top shows are next year. for nightly business rort, julia boorstin in los angeles. >> before we go the wahl dow down 70 points. nasdaq down 91. s&p down 15. and all three major averages a second straight week. >> and that's "nightly business report" stont. i'm sue hererahanks for joining us. >> and i'm bill griffeth. have a great weekend. >> yes. >> see you monday. ♪ ♪
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