>> susie: alcoa kicks off earnings season with a hit, helped by higher aluminum prices thanks to stronger demand for automobiles and energy. >> tom: when it comes to other firms, amid much higher oil and food costs, some experts still predict strong corporate profits this year. we'll explain why. you're watching "nightly business report" for monday, april 11. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by:

this program is made possible by contributions to your pbs station from viewers like you. captioning sponsored by wpbt >> susie: good evening everyone. solid quarterly earnings from alcoa tonight and an upbeat forecast from the aluminum giant. tom, alcoa is the first dow component to report, kicking off the corporate earnings season. >> tom: susie, it reported right after the closing bell. some good numbers. alcoa earned 28 cents a share, a penny better than estimates. up solidly from a year ago. revenues jumped 22% to about $6 billion, but that was slightly below estimates. that revenue miss hurt alcoa shares.

at least initially. they tumbled about 3% in after hours. >> susie: c.e.o. klaus kleinfed will join us shortly to talk about those results. this is alcoa's strongest quarter in three years as the company benefits from higher commodities prices. but erika miller looks at how rising commodity prices are affecting the rest of corporate america. >> reporter: the rising price of gasoline is taking a serious, immediate toll on many households. but the impact doesn't seem to be nearly as bad on corporate balance sheets. there's no question, the cost of doing business has been increasing at many firms. after all, on top of energy, the prices of many agricultural and industrial raw materials have also surged. so it may surprise you that profit margins for the s&p 500 are close to record levels. earnings expert mike thompson explains one reason why. >> the consumer is basically absorbing the costs. so, corporations are being able to pass on their higher increases to the consumer and

continue to, you know, make good profits. >> reporter: in addition, rising commodity prices are a reflection of an improving global economy. so, in many cases sales are rising at a faster rate than costs. plus, u.b.s. analyst david lefkowitz points out raw materials are only a small portion of total business expenses. >> we think it's somewhere between 7% and 9% of the cost structure of the s&p 500 is comprised of the commodity costs. so we are seeing high increases in those commodities that businesses use, but it's a pretty small portion of their overall cost structure. >> reporter: one wildcard for earnings is the impact of the japanese earthquake and tsunami. aside from a near-term impact to the automotive and technology industries, most analysts expect the overall damage to profits will be minimal. >> in order for us to get more concerned about the disruptions from japan, we would have to see the blackouts becoming more severe, a further reduction in

japanese economic activity, which is not what we are looking for. >> reporter: if energy prices slowly inch higher, consumers are not expected to drastically change their spending habits. but if there's a sudden spike in prices at the pump, the fear is many americans will panic and slash spending, hurting the u.s. economy and corporate profits. erika miller, "nightly business report," new york. >> tom: here are the stories in tonight's n.b.r. newswheel: stocks finished slightly lower as investors awaited those alcoa earnings. the dow rose a point, the nasdaq lost nearly nine and the s&p 500 off about four points. big board volume was modestly above 800 million shares. nasdaq volume topped two billion. federal reserve vice chairman janet yellen says the recent surge in global commodity prices should have only a temporary impact on u.s. inflation.

as a result, yellen thinks it's unlikely the fed will have to raise interest rates. >> these developments seem unlikely to have persistent effects on consumer inflation or to derail the economic recovery. and, hence, do not in my view warrant any substantial shifts in the stance of monetary policy. meantime, the international monetary fund warned surging oil prices, mideast turmoil and european debt threaten the world economy. but the i.m.f. doesn't expect those issues to derail the recovery. the i.m.f. forecasts the global economy to grow 4.4% this year. defense attorneys for raj rajaratnam began presenting their side of the case today. the big question? will the galleon group founder testify, telling his side of the story in the massive insider trading case? the jury could hear closing arguments from both sides this week. and another strong earthquake rocked japan today. it hit as the government expanded the evacuation zone around a damaged nuclear plant to 20 miles from 12. this is the one month

anniversary of the earthquake and tsunami that devastated part of the country. >> tom: still ahead, if you're running way behind on your taxes, we'll have tips on filing your 2007 return before it's too late. >> susie: more now on those alcoa earnings. joining us, klaus kleinfeld, chairman and c.e.o. of alcoa. welcome back and congratulationsing on the great numbers. >> thank you very much. >> susie: all right, so you said today the outlook is very positive for the rest of the year. where is most of the growth going to come from? >> it's really coming if almost all end narktz are relevant for us. you can go through it. it's arrow space, automotive, it's trucks and trailers, packaging. the only market-- the only end market that's a little weak, continues to being about expwlg construction. >> susie: what about construction and rebuilding in japan? will that be a grot factor

for alcoa? >> there are three things on japan. the first thing is we have factories there, we have people there and the good news is nobody got hurt. the factories are working. second thing is the ripple effect through the economy, logistical disruptions, that is still possible. but at the same time, i mean, the i.m.f., as you just quoted, had an estimate out there for japan growth this year of 1.6 exprs they brought it down to 1.4, giving you an idea of how the magnitude is and there is the third thirng the potential upside, as you said, the economy will be rebuilt and there is a discussion around nuclear and that will certainly make gas turbines, an area important to us, more attractive. >> susie: as we look through your earnings, alcoa certainly benefited from rising aluminum prices, but with more smelters coming online, not only the u.s. but in countrieses like china, do you see prices coming down? >> well, we don't.

we believe that there is a stable demand, and actually, we believe that the demand this year is going to increase by 12%. so driven by a lot of the customer demand they just described. and a lot of these industries, actually the aluminum content is increasing. automotive, for instance, here in the u.s., you have new emission standards so people are looking for light weight in the car and continuing to have it safe so what material do you go for? aluminum because it has a lot of capabilities that other materials don't have, from the recycleability-- 75% of the aluminum produced is still in use-- to mailability. >> susie: let's talk about the flip side of rising commodity prices. you're benefiting from aluminum prices but alcoa is a very big energy user. what impacts are high oil prices having on your business?

>> well, the cost of energy are important for us, and they are going up, which has a negative impact. but at the same time, when you look under the hood for our results, you do so we've been able to compensate for it, to find other things for productivity, which we could use to bring the cost down at the same time. but some of the cost factors are going up, that's clear. >> susie: all right. let's talk a little bit about your stock. it's had a nice run up. but today, after hours, after you came out with your earnings, it was down around 3%. sfwhapd what do you think-- why were investors selling the stock? >> susie, you are asking the wrong man here because we came out-- we came out with 22% ref thu growth and 20% profit growth, and in-- in all of our segments. you can go through aluminum, record results, higher than the last 10-year averages. on the midstream, we had 32% growth, and even

performances that are records. on the downstream, same thing-- 16% growth and records on the performance side. i think this is a great quarter and i'm pretty optimistic that people who take a little more time into what the fundamentals alcoa has shown here, capabilities to grow, as well as capabilities to-- to get the cost down. these two things come together and a great team that makes that happen. >> susie: all right. very interesting information about alcoa tonight. thank you so much, klaus for coming on, especially on earnings day, we really appreciate it. >> pleasure. klaus kleinfeld, chairman and c.e.o. of alcoa.

>> tom: there's a new budget battle facing lawmakers in washington. it comes on the heels of friday's last-minute deal to avert a government shutdown. that battle was settled with $38 billion in spending cuts. but this new fight has much higher stakes. darren gersh takes a look. >> reporter: in washington they call it the grand bargain-- a big deal to tackle federal deficits, a deal so large everything is on the table: taxes, defense-- even entitlement programs like medicare. washington analyst andy laperriere says investors are underestimating the odds of a major turning point in federal spending. >> i think what we are going to see over the next couple of years is policy changes that would be unthinkable today to a lot of people and were certainly unthinkable a couple of years ago. >> reporter: that means bigger tax increases and deeper spending cuts than most investors now expect.

laperriere says it may not happen this year, but it's coming. >> i still think we need an intervening election before we make the hard decisions about how we are going to balance the budget, and so i'd bet against big changes in entitlements programs over the next year and a half, but i think they're possible. >> reporter: but others read the government shutdown cliffhanger as a warning sign. changing washington's political and fiscal habits is never easy. budget watcher stan collender says not only is the economy not ready for deep cuts, the political climate is not right for a grand bargain. >> i just find it hard to believe that the big issue the republicans have now staked their hats on-- that is the deficit and being the one to cut spending-- they want to cut the president in on. i just don't think they are likely to negotiate with him on his terms. >> reporter: house republicans have laid down their plans to bring the budget closer to balance by reshaping and downsizing government. on wednesday, the president is expected to lay out a much different path. a grand bargain, if there is one, will have to meet somewhere in the middle.

darren gersh, "nightly business report," washington. >> susie: look for a fight over the new york stock exchange. the nasdaq o.m.x. group says it could make a direct appeal to n.y.s.e. shareholders after the big board rejected its buyout bid for the exchange. reports say the nasdaq's c.e.o. will meet with antitrust regulators in washington later this week to help pave the way. if regulators are good with it, the nasdaq reportedly will ask n.y.s.e. shareholders to okay its $11 billion bid. the n.y.s.e.'s board prefers the takeover offer on the table from germany's stock exchange, deutsche borse, even though the price tag is lower: $9.7 billion. >> tom: as investors awaited the alcoa results, several buyouts fueled some volatility and volume. let's get to tonight's "market focus."

before we talk about those mergers, hospital stocks were though were really hurting after tenet healthcare sued community health. we're going to pull out and roll out, community stock fell big, losing more than a third of its value. the sell-off came as volume exploded-- more than 30 times average. this is just the past 90 sessions. here's the past year. look at the damage done. the share price had been trending higher since august, but with today's selloff the stock dropped to a new 52- week low. in december, community made a hostile takeover bid for tenet healthcare. today, that target, tenet sued, claiming community made unnecessary hospital admissions, inflating revenue and over- charging the government and insurance companies. tenet claims community's hospital admissions criteria is different than industry practice.

community however calls the suit without merit. while the accuser, tenet, wasn't spared from the selling-- falling almost 15% today. volume jumped 12-fold. this is the past 180 sessions. shares popped in december when it received the hostile offer from community. the stock price shot up. we're at the lowest price since then after today's selling pressure. other health care operators were hurt too. health management fell 4.6%. universal health shed 3.6%. volume was heavy for both. nursing home company ensign fell more than 5%, but on light volume. despite the drop, the health care sector was one of the strongest. level 3 communications saw extremely heavy volume, more than 440 million shares. the stock jumped 18% to a new almost 52-week high. it was a big vote of confidence from the market in level 3's buyout of global crossing.

how about the target? its a $1.9 billion all-cash offer. based on tonight's closing price, it values global crossing around $27 per share. still above today's high. both companies provide internet services through fiber optic lines stretched across the globe. in the medical industry, endo pharmaceuticals will spend $2.6 billion for american medical systems, or $30 a share. american medical jumped to within 50 cents of its buyout price. the market likes the deal, bidding up endo stock by 0.5%. the other deal-- or no deal, in this case-- we mentioned earlier: the new york stock exchange rejecting the buyout from nasdaq and intercontinental exchange. n-y-x stock fell off its premium that we saw late last week, down almost 3%. a couple of breakout stocks. chinese internet firm baidu rallied to a new high on unconfirmed reports it has a deal with facebook for a social media website in china.

and drug developer biogen idec jumped to a new high. it had good drug trial results for a multiple sclerosis treatment. and that's tonight's "market focus." a bull market finish for golf's premier event, the master's. after a couple of years in the rough, the business of golf may be back. tonight's "beyond the scoreboard," our look at the business of sports, starts on the front nine. rick horrow is a sports business analyst and c.e.o. of horrow sports ventures.

always nice to see you. nice finish there at the masters, char making a bit putt there. >> absolutely, and the business is coming back in a big, big way. playing on courses has rebounded after a tough couple of years. is the business of golf back in a big way? >> it's back, maybe not in a big way with a caveat it's numbers are up, the economy is turning around, but the kids getting into game, ages 6-17, down 30% compared to five years ago, and kids from households under $50,000, they're less and less to get inclined to get into the game. so the pied piper that is tiger woods may be wearing off a little bit. >> tom: and those are the future golfers, the future buyers of all that golfing gear. fortune brands which owns titlist and pinnacle has talked about spinning off its business. you look at calloway, meantime. its share price has essentially been driven into

the rough, well off the fairway over the past year. clearly, not all businesses have been benefitted. >> it is mixed. masters tv ratings just like that. this year last year, pretty good. last year, a little better because tiger just came back. and it was uch 18% compared to two or three years ago. so it is picking up, but they've got a long way to go. >> they clearly do. meantime, we have the olympics by june. the olympic committee expects to have its bids in for tv rights rights for the olympics. nbc, of course, has been the big buyer of these games and we'll look at the decades, prices essentially doubled, but nbc has a new boss with comcast. >> they'll have cash, more important than anything else, but they have a lot of other bidders. they have the abc family of networks, turner, cbs, fresh off of march madness success, and you have a lot of these

networks willing to pay over $2 billion on the table today to land the olympics. >> with so many bidders, fox, nbc, disney, and orders, what's the return to shareholders? >> one is technology. you get it on the mobile phones. you get it on the internet. you get it everywhere. there is more vertical integration there and the second is the more bidders the better chance of winning, the more of a success psychologically for shareholders. >> speak of psychological, uncle sam was able to do what the nfl wasn't able to do which is avoid a shut-out. they continue to be shut out. talk about this as a negotiating tactic because both sides in the nfl dispute don't appear to be closer to a solution. >> shut-out, lockout, whatever you want to call it. the bottom line is the judge is deciding what his/her timetable should be. that's not business negotiators. when the nfl and the nfl p.a. decertified and said let's go to the courts they gave up control. that's big issue as we guess close to the draft and other football-related decision. >> it's out of the court

room and into the board room. >> susie: here's what we're watching for tomorrow: the u.s. reports on the trade deficit for february. world bank president robert zoellick joins us to discuss how the unrest in the middle east is affecting the global economy. and now that they're back to paying dividends, is there money to be made by investing in banks? we'll take a look. some nissan leaf owners in the u.s. and japan are having a hard time getting their cars to start. nissan is trying to figure out why. reuters reports it's related to the vehicle's air conditioning system. the leaf is the first all- electric car that can be driven 100 miles on power alone. so far, 452 have been sold in the u.s. >> tom: meanwhile, if you put gasoline in your car, chances are you're driving less these days. as the national average for gas rises toward $4 a gallon, sales are falling. mastercard spending pulse keeps

tabs on 140,000 gas stations nationwide. it says sales have now fallen for five straight weeks. the last time drivers cut back on fuel was in october of 2007, when prices were at $3 a gallon.

>> susie: the clock is ticking. the deadline for filing your federal income taxes is just a week away. until then, our tax expert, kevin mccormally will be here every night with last-minute tax tips. he's editorial director at "kiplinger's personal finance." tonight, kevin has advice for people who may be owed money but not know it. >> with one week to go before the filing deadline, i want to talk about folks who are very, very far behind. i'm talking about the one million-plus taxpayers who still haven't filed their 2007 returns. i know there are at least a million of these scofflaws, because the i.r.s. says it's sitting on more than $1 billion in potential tax refunds that it owes these folks. and next monday is the deadline for them, too. if they don't file by then to ask for their money back, uncle sam gets to keep it. forever. why on earth wouldn't people file returns if they had money coming back? maybe they forgot. maybe they didn't know they were

supposed to file. maybe they missed the deadline and were afraid to come forward for fear of being in trouble. an important reminder here: there's no penalty for filing late if the i.r.s. owes you a refund. now, i doubt if many "nightly business report" viewers are in this boat. but what about your kids? did johnny have a lifeguard job in the summer of '07 and not realize he needed to file to retrieve the income tax withheld from his checks? or your elderly parents or grandparents? was money withheld from a lump- sum payment from a retirement plan that was really tax-free because it was rolled into an i.r.a.? whatever the reason, they stand to lose several hundred, or maybe several thousand, dollars each if they don't file that 2007 return by midnight, april 18. if you know someone at risk, check out the i.r.s. website, www.irs.gov, for details on how to get that money back. i'm kevin mccormally. >> susie: just a reminder: you can submit your tax questions for kevin on our website. just go to nbr on pbs.org.

but kevin is taking your tax questions only through wednesday. look for the "tax tips" section on our home page. >> tom: speaking of taxes. tomorrow is the day you start working for yourself, and not for the government. it's tax freedom day, the day you've earned enough money to pay your federal, state, and local taxes. this year, the tax foundation says, it's tuesday, april 12. that's three days later than last year. americans are earning more money these days, pushing us into higher tax brackets. but tax freedom day does not account for the federal deficit, susie. put that in the mix, and you'd have to work until may 23 to get out from under uncle sam's tax thumb. still got about six weeks left until then. >> susie: tom, have you filed? >> tom: yes, i have sgliz i have, too. thank god. i doint even want to think about taxes until next year. >> tom: putting the pencil

and calculator away until next year. this program was made possible by contributions to your pbs station from viewers like you. captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org