cyber threats... rising conflict with syria has u.s. banks on guard. in today's cover story... a staggering amount of cash is flooding the housing market... and...it's a hit! the inspiring story of a group of nuns who are rocking the music industry. plus... the retail risk. why our traders say its a tough time to shop for stocks. first business starts now! you're watching first business: financial news, analysis, and today's investment ideas. good morning! it's friday. august 30th. i'm angela miles. in today's first look: stocks on edge! the situation in syria will serve a back drop to trading today.. yesterday-- the market staged a modest rally as new

data shows the economy is growing faster than thought and the labor market is improving as well.the dow, nasdaq and s&p all gained.. gold fell $12 to 1,407. oil down $2.15 to $107. sales force soars - the stock rallied more than 7% after hours on stronger than expected earnings at the software company. and a jump at the pump-- as we head into the the labor day weekend.. gas prices are up 3 cents from a week ago to $3.56... as oil continues to trade above. $100 because of pressure from syria.. > >scott bauer of trading advantage is with us this morning, and scott, how is the market likely to react to air strikes in seria? > >well, if we unfortunately see that happen, i think the initial shock-- the initial blow to the market-- would be somewhat to the downside. you should see oil prices rise. i'm sure you'll see bonds go up, rates come down.i do think that there is somewhat of a limited

downside. once all is considered in, and once we see the extent of what is happening. and the reason i say that, angie, is recently some actually very good numbers, economically, come out. jobless claim lowered, gdp, you know, revised upward. but obviously it's a very serious situation and we would absolutely see the quick market spike to the downside. > >well that was my next question to you. with the decent economic news that we did get at the market this week, do you think we will get a carry through as of friday? > > i think we're going to see very light volume. i think later this morning we're going to get most of the volume probably in the first hour of the day and traders are going to take their positions, flatten them out, and get out for the long weekend. so i would expect as the day progresses, extremely light volume, and maybe even a bit more volitility because there's not going to be a lot of players in the market place. > > thank you for your time today. have a good trading day

and a happy holiday. > > thanks, you too, angie. the escalating conflict with syria is creating anxiety--over potential cyber attacks. bloomberg reports u-s officials are bracing for possible retaliation from syrian hackers. u.s. banks are particularly on guard for unusual activity. bank of america, jpmorgan chase, citigroup and others have increased online security following disruptions last september. government officials are also concerned about the outtage of the new york times website earlier this week. usa today reports: its suspected the syrian electronic army was behind the hack attack. "in the past alot of malware was trying to compromise as many computers as possible. today, the trend we have with sophisticated attacks is to target and compromise as few systems as possible. because they know exactly who they want to go after. whether it is a particular person, network, even a specific computer." that

was kenneth geers, a senior global threat researcher at security firm fire eye.u.s. intelligence reports contend what syrian hackers are capable of disrupting is limited. the nasdaq is blaming a "software bug" for causing trading to stop at the exchange for more than 3 hours last week. specifically the nasdaq says there was a electronic connection problem between the new york stock exchange and the nasdaq... both exchanges have been ordered by the sec to detail a clear account of what went wrong.. the u-s economy had an unexpected growth surge... the u-s gdp rate grew at a rate of 2.5 percent in the second quarter, double the pace of the first quarter. unemployment claims are down, exports are up, and the housing market is in a modest recovery. fast food workers continue to rally for a change to their pay rates. they protested from coast to coast thursday-- saying they want to a pay hike from the minimum age of $7.25 to 15 dollars. many have jobs at mcdonald's, taco bell and wendy's. fight for fifteen tells first business 56 cities in 21 states are involved we caught up with a customer and a demonstrator in california. "we are affected as workers of these places, and

what we get paid right now? we can't provide for our families. for me, every paycheck i get hold of, it just goes, the minute i receive it. i feel like i am working most of the time, and not making anything." "i think they should be getting $15 an hour because they work hard, they have to do all that customer service, so they deserve it." mcdonald's says it "aims to offer competitive pay and benefits to our employees.other employers contend the wage increase would be passed onto customers. the trend of paying cash for homes is on the upswing in many states.realtytrac says two out of every five homes sold last month was purchased with cash. our cover story looks at who's in but also who's left out.home buyers paying cash is on the rise...

accounting for 27% of all home sales in colorado...40% nationally...and in florida, 66% of all home sales there... much of florida's activity from international investors...making it difficult for first time buyers--who had a hard enough time, already. "in a market that already had limited inventory, it takes a lot of homes off the market for the first-time buyer looking in their price range." "young people hven't moved out yet. they're still living with their parents and aren't even renters yet. they need their job prospects to improve." what's driving it? some say a combinatiion of rising mortgage rates and tightening of mortgage requirements. but others say its a trend of institutional buyers and private equity firms moving beyond the distressed markets in the sun belt states of arizona, and florida. "we're talking about hundreds if not thousands of properties being purchased and leased with the idea that they'll sell them when the market appreciates." and investors with cash,

spreading beyond the sun belt are moving into places such as the chicago suburb of oak park, illinois, a market that brokers say has not attracted a big number of institutional investors, two investor firms made bids on this 3-bedroom, 1 and a half bath bungaloo. asking price--240-thousand. "it seems that about a year ago, someone flipped a switch and it turned into a seller's market." sellers got some additional good news. seattle-based zillow reports that the number of homeowners who owe on their home that it's worth fell from 13-million at the beginning of the year to 12.2-million by july. u.s. banks are in the money.. fdic reports-- large banks earned a record $42 billion dollars in the second quarter. also, losses from bad loans tumbled and fewer banks are at risk of failing. bank lending however increased just 1% from

the first quarter. citigroup is in the spotlight for libor rate-rigging. regulators are investigating two senior citigroup execs accused of manipulating libor rates to boost trading positions.the accusations come after an employee was fired for manipulating benchmark rates.former citigroup employees said that the former trader and his boss got help from senior execs to rig rates.citigroup says the two execs are cooperating with the investigations and remain valued employees. the prime minster of india is expected to remark on the rupee today... india's currency and has fallen dramatically since may. thursday, the rupee rebounded from a record low on action by india's central bank. it's anticipated the prime minister will address the econonic situation in india -- which is reportedly at a crisis level as the economy slows. the future of airline jobs is up in the air. industry wide jobs have dropped 2.4 percent since last year...

american airlines slashed 8.4 percent of its workforce as it cut costs during bankruptcy. united's count is down a tenth of a percent. delta's, down nearly 4 percent. however, boeing says it will need nearly a half-million pilots by 20-32. one of the largest deals in the last decade is a step closer to happening.. vodaphone confirms talks are on again with verizon. vodaphone is considering selling its 45% stake in verizon "wireless" to verizon communications. the deal may top $130 billion dollars.. verizon stock jumped 3% in heavy trading thursday. elon musk's high speed transit concept is up for grabs. musk has a blueprint, but is asking entrepreneurs to step forward by going to "jump

start fund" dot com. the site combines crowd sourcing and crowd funding for people interested in developing the hyperloop as the ceo of tesla -- musk says he's too busy to take on the task. tablets are hot sellers for tech companies.. but idc is trimming it's tablet sales predictions. tech crunch reports: orginally idc forecast 229 million tablets will be shipped worldwide this year. that number is now lowered to 227 million. smartphones with larger screens known as phablets-- and smart watches are expected to threaten tablet sales. rumors of an i-phone trade-in program could become a reality today. apple watchers 9-to-5-mac report that the trade-in deal may happen today in some stores. the program let's consumers trade-in a phone for credit towards a newer version of the i-phone. the la times says employees at t-mobile are not allowed to take september 20th off...a possible indication that's when the 5-s will go on sale. the co-founder of google is said to be splitting with his wife. according to all things d-- sergey brin and his wife of 6 years, anne wo-jit-skee have been living apart for months, remain good friends, have a pre- nup and are not legally separated. the report adds that brin is dating a google employee. also-- the vice president in charge of android at google reportedly is leaving the company to joining a chinese smarthphone startup. ford is ramping up production of its fusion at a michigan factory the car, is currently made in mexico. however with sales up 13%, the automaker will add production lines in flat rock

michigan.14 hundred jobs will be created.. still to come:stock surprises. what companies could be poised for a pop? thats later. plus..... break up rumors top the list of hot topics in traders unplugged. and, how a group of talented nuns are proving to the music industry that you gotta have faith. bill moller joins us with that uplifting story, next.

> > for the past two weeks you know what's been the number 1 billboard hit? well listen.

singing nuns. okay, robin thicke is still overall as tops but this modern day, sound of music group of nuns is the top of the classical musical chart. the album is mater eucharistiae or mother eucarist, as performed by the dominican sisters of mary in ann arbor michigan. sister joseph andrew oversees the music for the order. you beat some big names- including andrea bocelli and bach himself! i can't believe you set out to be chart topping sister super stars. > > i know! it has been such an exciting adventure. we did it for lord and he's always full of surprises. > > is this selling with non- catholics as well? > > oh i think across the board-- because i think everyone wants to connect spiritually with god, you know... and definitely, yes, yes it is. > > do you check the rankings everyday to see if you're still on top? > > we check them periodically, definitely, yes. it's been fun.

> > has this changed anything for the dominican sisters? do you get phone calls? do you have paparazzi now following you around? actually, bill, we do get phone calls...and it's on the facebook and it's on emails... and people have been very very positive and yeah even more so than we would have imagined. people really do want this, so it's been really well recieved and it's kind of a constant with us now. yes... > > people like me bothering you for interviews. now you wrote two of the pieces including "i am in thy hands oh mary" let's listen for a moment... now that is the sound of purity and warmth... and real reverence and it seems to me-- this is not just beautiful music, this is the consecrated work that you do of your devotion. > > exactly, yes.

> > and is that how it works when you are writing your music and creating the choral parts? you're thinking basically about reverence for god... > > oh definitely, because that's really what our lives are dedicated to, so we give ourselves totally to god through the vows of chastity, poverty, and obedience that we make. so our lives are for him, so when we write music it's an overflow of the love of the heart for christ, definitely. > > do all of the dominican sisters have a song in their heart? > > i would say probably so... i like that, i like that very much and we pray a lot... and for me and i would think for many people,pray is very musical, so to speak. you can think of a tune or a melody and it doesn't always have to have words to it. it's just the way we express ourselves as people. music's a very important part of the soul, yeah. > > when you take your first global tour, i wish you the best there as well. sister andrew thank you so much. > > thank you so much. thanks bill!! coming up.... retail retake....traders take a second glance at a troubled stock. thats next in traders unplugged. and later....breakouts on the horizon ... a trader steps in with his predictions on stocks that could be ready to rip. we'll be right back.

angie: ready to take on the world and a few of our questions trader alan knuckman and trader james rameli join us now for traders unplugged from the floor of cme group. good morning guys. alan: good morning james:good morning angie: number one: breaking bank. jp morgan has a number of legal issues, but one analyst says the bank is actually worth 30% more if it's broken up. would you buy or sell this stock? alan: well i'm a buyer, especially of stocks that are under severe distress, and

issues, but they've sold out 10% from the highs. i'm leaning on this 50 level. 50's been the favorite since april. you can buy an in the money 45 call for february and have about 7 months and your break-evens only a dollar higher. james: right, so you know the stock has come off its highs quite a bit here-- about 10%. i see 48 as a very key level here. alan: well it's only $2. james:until there, i only want to play it nothing but flat or short. the banks have let this rally higher and they're going to lead a sell-off if we get one here. if i have to own a bank, i'd rather own wells fargo. alan: technically i'm looking for the stock to get to 80 eventually. angie: topic number two: retail wreck. bill eckman, the big investor activist, sold off his stake as jcp, at a loss. what would you do with this stock? james: right, so playing any retail stock in this market right now is like playing craps at the casino. we just don't really know. there have been stocks that have held up really well... alan: back to school... james: urban... jcp has not been

one of those stocks. it's been a weak stock all year long. there's been extremely bearish order flow in the equity options space. they're implying that this thing is going to go below $10. alan: well looking at this, i love stocks that have this kind of capitulation event. this guy lost $500 million with this stock, but buyers stepped up and took out his 18% stake in the company. so i think there's some value here because of this high volitility, there's options plays, but it hasn't been below $10 since 2001. so somewhere around here, jc penny is going to be a buy, and there's serious money that's getting into it right now. angie: topic number 3: tech talk. the nasdaq came within one point of of a 13-year high, is this a last gasp or a sign of more strength here? alan: i think it shows leadership of the technology sector. if you look at the p.e. ratio, it's down at historical lows. it's only around 13 for the p.e. which is a 30 year low. so i think there's more upside, but keep an eye on apple. as apple gets stronger, that lifts the nasdaq because it comprises about 10% of that nasdaq index. james: right, i actually completely agree with him. we saw tech kind of lag in the first part of this year and it's really starting to come back. of course, being helped by

the participation of apple. apple to come back a little bit here. the valuations look good. the only thing in the short term there is some down-side risk if the market rolls over-- if we get our taper information... alan: i want to talk about the market in general. the vix did not make new highs when the market made new lows here this week. that could be a sign of some bullish divirgence, and the overall market can make a nice move up from here. angie: well here's your bonus round question here guys, it's for labor day: which of these statements are true about labor day? labor day originated in canada, labor day started in the u.s. in 1882 in new york city, the first waffle house opened on labor day in 1955. alan: well if it was in canada, it would be l-a-b-o-u-r,so the answer is no. james: and i think it was... i think it was the canada one. alan: b! i pick b! angie: they were all true statements. alan: oh man! every time you get me! james: that's a trick question. angie: every time! i'll tip you off next time if you, you know, give me a little on the side. thanks a lot, guys! alan: thank you. angie: first business continues right after this...

> > tim biggam of trading block joins us now for chart talk to talk about some sneaky stocks. good morning. > > good morning angie. traders are caught up in taper talk. they're also watching the situation in seria, but there have been some stocks that have made sudden moves--big bursts here. what stocks do you see going forward that can have major moves? yeah absolutely, and you eluded to syria which caused the price of oil to, you know,go up sharply. a stock that has been beaten up and making a big move recently is the biggest of the big, or used to be-- exxon mobile. that stock has come down nine days in a row until recently. bounced off major support around that 85 level. this is the third time down there, you know, it has had a real nice pop off of there. i like this stock going forward, not only on a price basis, but also pretty attractive dividend around here, you know, pushing above 3% and with oil looking like it's going

to keep well bid atleast for the future,they'll feel the big benefit of that. > > what about some of the metal stocks? > > absolutely, some kind of there, you know, gold is finally looking like it's found a floor, has rallied up...and these gold stocks, which we've talked about a couple times, are finally starting to move in a big way off their lows here-- i like the bigger names. newmont mining being one, you know... american berrick, newmont coming off that high 20 level-- abx coming off that 17 level... so these stocks have put in a nice game, but i think it's just getting going on a lot of these--there's a lot of valuation gap to fill there. > > traders were caught off by surprise by guess, by tivo, by zales. do you like any of these names? what other names did you put on your list? > > yeah i think you hit the nail on the head here. this is going to be kind of a stock pickers market, and with a lot of the names that are in the news-- the teslas and the green mountains of the world getting a little stretched here. i think traders are gravitating towards those forgotten names and those might be the names, i think, to own going forward-- that rotation in-- the kind of the

dogs, not of the dow, but the dogs of the russell 2000-- value may trump at growth here going foward. > > tim, always a pleasure. have a good weekend. > > you too. thank you angie. that wraps up our show for this week... coming up on monday-- the market is closed but we have a special edition of first busines lined up for you. including an edition of trader's unplugged with the guys on the lookout for the next hot stock. we hope you will join us. from all of us at first business.. thank you for watch and enjoy the long weekend.

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