this is "nightly business report" with tyler mathisen brought to you by -- investors sold stock today as quickly as they bought them yesterday. could this volatility be a sign of what is to come this summer. hog wild. china buys the biggest pork

producer. price of admission. today is may 29, the perfect day to look at the pros and pit falls of 5/29. we have all of that and more tonight on "nightly business report." good evening. what goes up must come down as the old saying goes and that is exactly what happened on wall street today. it was a broad based selloff without any really triggering event but with no major economic reports the attention turned once again to the federal reserve. and when the central bank may start to scale back its bond buying program. one clue came from the boston fed president who said today a modest pullback in the stimulus program could make sense in a few months. the dow closed lower by 107 points, worst day in about a month. it ended at 15,302 and change. the s&p fell to 1648.

and the nasdaq was off 21 to 3467. as investors hang on to every word coming out of the fed, big gains one day and big losses the next something we should get used to this summer? kelly evans takes a look. >> reporter: this summer markets are making plenty of waves of their own. japan's index plunged nearly 1,000 points. the government bond yields have doubled and the yield here at home has jumped. the dow jones industrial average has gone from the worst week this year to jumping more than 200 points early tuesday to closet at a fresh record high to reverse course today giving up as much as 175 points. confused? you are not the only one. the sharp moves have plenty on wall street scratching their heads. the question is whether it is a

more volatile summer ahead. and it stems on a debate on how much the economy is improving. >> question is how sustainable it is. it is if they walk away. there is only one twie find out is if they do walk away. i think they won't. i think that is the problem. if they walk away does the market collapse? who wants to make that bet? >> reporter: in past years markets have sold off each time diminishing support arose. this time around the worst performing sectors are those like utilities most sensitive to higher interest rates. in other words, investors seem to be digesting the idea of the fed actually tapering its support. given that it is surprising and encouraging the market has held up this way. that could change, however, if job growth starts to flag again.

none of these are remote possibilities, better hold on to your hats. for "nightly business report" i'm kelly evans. is the individual investor prepared for a volatile summer? that is one of the questions we will ask tomorrow. turning to corporate news, the largest takeover of an american company by a chinese buyer. one of the biggest pork producers in the u.s. has agreed to sell itself to a chinese firm for $4.7 billion. the boards of both companies have ookayed the sale. as michelle tells us it will face scrutiny. >> reporter: it is the largest pork processing company in the world. share holders of smithfield will receive $34 of cash for every share they own, 30% more than

where the stock was trading yesterday. >> i hope i still have a job. >> reporter: the chinese company has agreed to keep all plants and honor all laborer contracts. the deal is still facing criticism because of food incidents in china. two years ago it was found to be selling chemically tainted meat. >> china is epidemic of poison products. the question is if smithfield rubs off on china or china rubs off on smithfield. >> this is not a strategy to import chinese pork into the united states. this is a strategy to export pork out of the united states. open the refrigerator door. nothing is made in china.

american agriculture is the most competitive in the world. >> reporter: it is buying amica to improve the safety of its food supply chain. >> aig is waiting to hear whether the u.s. government will allow the insurance giant to sell a large stake in aircraft leasing business. another cross border deal. japan's soft bank and sprint received national security clearance from u.s. authorities that will let soft bank move ahead with the $20 million bid for the third largest u.s. wireless carrier. the deal faced criticism. the deal requires approval from the sec and sprint shareholders. mortgage rates are on the rise and today they hit their highest level in the year.

the 30 year fixed is now at 3.9%. it's not just mortgage rates that are raising but home prices, as well. the combination could be a lethal one for the housing recovery. >> reporter: in burbank, california, home prices have been on a tear lately largely due to low supply of homes for sale and increasing buy eer demand. >> as interest rates are closer to 4% we have seen a slow down in the market. >> reporter: the average rate rose to 3.9% last week according to the mortgage bankers association after hitting a record low last december of 3.47%. while the difference may not seem that big everyone percentage point in rates reduces the average home buyer's maximum purchase price by just over 10%.

>> mortgage rates can't go too much higher than this because it is a highly levered economy and household balance sheet. they can only afford so much. >> reporter: today is nothing like 2007 and 2008. rates are lower but it is tougher to get a mortgage. the lowest go to borrowers with sizable down payments and high credit scores. traditional buyers using mortgages have been coming back lately only to come up against bidding wars for what little there is to buy. one upside could be an easing of that tight supply. >> sblie and demand is the rule. right now there is still a low supply of housing although you are starting to see that supply creep up as homes are not selling as fast with interest

rates being higher. >> reporter: of course, on the flip side some who have been on the fence about buying are quickly jumping in. for "nightly business report." >> nasdaq will pay the largest fine ever levees against an exchange for the botched yield for poor systems and decision making before and after facebook started trading. nasdaq ceo calls the settlement an important step forerward and has reviewed the events. facebook went public last may only to be scarred by lots of technical problems. the move away from personal computers and towards tablets is picking up by a lot. a new forecast from research company says shipments of pcs will drop by 7.8% this year much more than the original prediction of a 1.3% decline.

by the year 2015 it is estimated sales of tablets will outshift not just lap tops but all pcs. tablets are at the conference. the gathering of some of the industry's top players, executives, entrepreneurs, why should we care? john ford explains. >> how do you look at yourself in this landscape? >> reporter: in the decade since it started it has emerged as the giant. two veteran journalists who cover tech from different angles are the driving forces behind the conference. the long time tech reviewer focuses on technology and products. swisher a long time columnist focuses on people and strategy. they built a team of tech journalists and built a conference centered on conversations with the most

influential tech executives like these two. >> pc guy is great. >> reporter: ten years ago the rise of the ipod was a hot topic. so was search. two years ago microsoft showed off windows 8 for the first time. why? venture capitalists, hollywood moguls and tech execs mingle here. this year apple ceo tim cook, facebook's sandberg and twitter. the tech demonstrations include cutting edge efforts like two bit circuits trying to get people interested in engineering by creating hands on carnival games. for them the audience here is invaluable. >> these are people that are really crafting the content and platforms that millions of people are consuming in their company. >> things are getting invented

here. people coming together who haven't met before, coming up with amazing ideas that we are going to be buying or seeing or using. >> reporter: the future of the conference a little up in the air. they could do a deal with a different company this time for the first time perhaps ever some of the buzz in the hall is about the franchise itself. coming up as college costs soar not all 529 savings plans are created equal. find out which ones are worth owning. first a look at how the international markets closed today.

u.s. needs a mandatory savings policy. that is the dire message from larry fink, the man who heads the biggest money management firm. he says people are living longer and bonds are no longer providing 76 retursufficient re >> if you actually put your money away in bonds ten or 20 years ago you enjoyed very good returns. for those who were continuing to put the bonds earning 2% or 3% they are not going to get close to their needs unless they start contributing at a much greater percentage of their disposable income of which would have pronounced impact today. >> to think the average american only has $25,000 of savings. saving for retirement is one huge challenge and putting away for college is another.

more than $166 billion of collected and 529 plans, the popular college savings friends with benefits, tax benefits. are these plans the best option tr your college savings? sharon epperson has more on the pros and cons of 529. >> reporter: jason and caroline miller know the key is starting early and saving often. >> we have a 1 year old. we started the plan when she was 6 months old. we have a boy coming august 25. >> reporter: they make regular deposits into a 529 college savings plan that has garnered much attention in recent years especially for tax benefits. >> all of the contributions and earnings come out tax free for you for tuition fees and books and equipment. that is probably the key reason why families have invested $180

billion today in them. >> reporter: nearly every state offers a 529 plan. you may get a state tax deduction on contributions to that plan. you can pick any 529 planet that is best for you based on your risk tolerance and how much you need to save. anyone can contribute to a 529 plan for a child or another beneficiary. >> very good. >> reporter: the millers set up a 529 plan for their daughter, clara. that can change. >> my daughter may get a scholarship. if that happens that money designated for her would be rolled to the second child. if the second child were to also get a scholarship then we would be left with money that we would have to take out and be penalized for taking out. >> reporter: that may be one of the biggest down sides to 529 plans. funds can only be used for qualified higher education expenses. otherwise earnings with dawn are

hit with a 10% penalty and taxed. investment manager handles the money. you can't invest in individual stocks or bonds or make frequent changes to the investments you choose. some financial advisers say custodial accounts in your child's name may be a better option. >> what that allows is better options and diversified and can reduce volatility. you can take the account and transfer to 529 plan and take advantage of some of the financial aid advantages that a 529 plan has. >> reporter: while the custodial account has a high impact on financial aid eligibility. by transferring it to a 529 plan it becomes a parental asset with much more financial aid treatment. time for the miller's to use several options to invest in

their children's education. >> which 529 plans are at the head of the class? morning star recently analyzed dozens of options. here now with the best and the brightest, laura lutten, director of research. before we get into the list of the ones that are the best ones to invest in and not so good to invest in, let's start with the question of how do you choose? there are lots of them. they are complicated with what you can and cannot do with particular funds. how do you get started on this? >> i think a great place to get started is looking at your own state's plans and seeing if there are state tax benefits that you can take advantage of if you stay local. that would be the first step. after that you really need to decide what kinds of investments you want. do you want to manage these yourself and go into broad indexes or working with a financial planner or adviser who is going to direct you to match your savings with other

investments that you might have, as well. >> i'm sensing here and i want to get to the list of the winners and the sinners. if i get a tax benefit, a tax deduction in my state that you give that very heavy weight and maybe above the expenses of the plan or its performance. >> we found that the state tax benefits or other benefits from the state can make up for a lot of ills like higher expenses or investments that are solid but that we're not totally crazy about. >> you have listed some of the ones you get ratings from the morning star analysts. you do your homework. tell me which ones they are. tell me why these stood out. >> well, i think what all of the plans have in common is they have very strong investment options at a reasonable cost. these we have a lot of confidence in the ability to outperform on a risk adjusted basis over a full market cycle or the life of your 529

investment. >> this is based on the past performance. if i live in maryland but i want to go to the alaska plant i can. let's transition to the bottom of the class. why didn't they make the grade? >> in some cases we had some concerns about the investments in the plan. in other cases we thought they were just too expensive. we found in our research time and time again that the less you pay for an investment the more likely you are to outperform over the long term. >> let me ask you this that sharon epperson brought up in her report. why not put your money in a mutual fund where you have a lot of flexibility. you don't get the tax benefit but why not a mutual fund? >> i think the tax benefit is really important particularly if we see nice gains in the stock market over the life of your investment. being able to take those out tax free to offset your college expenses is really significant

and gives us an advantage. >> why are the expenses in most of the 529 categories higher than they are in comparable mutual funds? >> i think because this industry is relatively small compared to the billions and billions that we see in the mutual fund world. so it's just, i think as the 529 industry gets larger we will see expenses continue to come down and be more competitive. >> we have a few seconds left. what is the biggest mistake that families make and what is your best advice? >> i think leaving those state tax benefits behind is something i would really think twice about. and then just being aware of your own tolerance for risk because you have market exposure in a lot of these and you have to be prepared for that. >> thank you so much. and market focus begins with a company tonight that is splitting itself in two.

sally may is going to manage loans and another to be involved unconsumer banker. it was downgraded while moody's placed the company in review. shares lost early gains but closed up at 2348. price line.com, announced a billion dollar buy back financed in part by a private debt offering. shares were off 1.5% in today's session but did jump on the buy back news as you see there. michael kors said revenues were up 57% and net profit more than doubled as it reported results today. comparable store sales up more than 36%. shares jumping at the open but then settling back a bit. mid american energy holdings is buying a nevada utility for $23.75 a share.

it is valued at $5.5 billion. it provides electricity to 2.5 million customers in las vegas. and we have heard a lot about the baby boomer generation's impact as they age. today's example of consolidation at the top of the funeral home and cemetery business. service corp international by stored enterprises. service corp up nearly 5% to 1844. still ahead a modern family milestone. why the old saying dad is bringing home the bacon no longer is true. first a check on cuf commodities.

want to buy a piece of the empire state building? you may get your chance. stakeholders approved a plan to sell it as part of an ipo. the proposed new company would include the skyscraper and 18 other properties. the stake holder vote was disclosed in an sec filing today. >> working moms are the primary bread winners for a record share of american families. for more on this here is sue herrera. >> reporter: data from the pugh research center shows mothers are the primary bread winners in four of the ten households with children.

the majority of the women are single mothers earning about $23,000 a year, well below the national median. the others are married women who earn more than their spouses and those house holds earn an average of $80,000 a year well above the national median. the data shows an increased presence in the work place. among married mothers the employment rate is -- not a surprise when you consider that women make up nearly half the u.s. workforce today. >> it just shows that if you give women a chance they can do equal job. >> it takes away from the tradition of being a man. >> if i get married it is fine. i don't want to be reliant on my husband. i want to be able to support myself. >> i wouldn't mind staying at home cooking so my wife can do her thing. >> reporter: women only earn 80% of what men do. the higher the level of

education the greater the earning potential. >> we have a whole population of married women out there who are either as educated or better educated than their husbands. that explains why we have seen the growth in the share of wives who make more money than husbands. >> reporter: nearly one quarter of women outearn their husbands and the income is $2,000 more per year than in homes where husbands earn more money. before kids ask dad for increase in allowance they might want to consider because more and more it is mom bringing home the bacon. >> i think it is all good news. i think it is all very good news. i'm fine with the idea. that's "nightly business report" for tonight. thanks for being with us. >> have a great evening. we'll see you back here tomorrow evening. >> "nightly business report" has been brought to you by --

tonight on "quest" -- from software to biotechnology, california's economy is increasingly driven by innovation. but when it comes to science education, the golden state's public schools languish near the bottom of the national rankings. join "quest" tonight for a half-hour special on california's science education struggles. meet top teachers and learn about some of the innovative programs aimed at turning around our poor science grades. major funding for "quest" is provided by -- the national science foundation. the gordon and betty moore fouio