this is "nightly business report" with tyler mathisen and sue herera. record setter. new highs for the s&p 500 and the russell 2000. why stocks shrugged off worries. yield spike. what's happening in one of the biggest markets in the world? treasuries. what it could mean for your investment. danger on the rails. two rains carrying crude run off the track. west virginia's governor declares a state of emergency in two counties. tonight, the growing risk as america ships more and more oil in tanker cars. all that and more tonight on "nightly business report" for tuesday, february 17th. good evening, everyone. i'm tyler mathisen. sue herera is off tonight. well put it in the record books. the s&p 500 hit 2100 on the nose

for the first time ever on speculation of a bailout extension for greece. according to reports, that country will ask for an extension of the country's alone agreement tomorrow. but there is no official word no confirmation just yet. the extension according to multiple reports would prevent the country's current agreement from expiring at the end of the month. that prospect worried investors for months since it could lead to a spiral of events from a default to greek exit of the euro. dow jones industrial average up 28 points to finish at 18,047. close to an all-time high there. nasdaq up 5 and s&p 500 closed 3 points higher but that was good enough for the fresh recordthe button. a lot of action it did today was in the bond market as the yield on the ten year approached a 2015 high. here too, analysts pointed to

the pressospect of a debt extension for greece. michelle caruso-cabrera reports there's one major difference now that stands between greece and its creditors. >> reporter: the difference between the two signs of the greek negotiation come down to both sides having very different visions of just how important greece is to the euro zone. so listen to the greek finance he said europe is a house of cards. if you let greece go, europe comes tumbling down. investors start to think that italy and spain are next. in germany, they have a very different image. they see the situation as 19 people climbing up a mountain together. they're all connected by the same rope and they have one very weak climber at the bottom that would be greece. and what do they do about that weak climber? do they all keep struggling together? do they risk the fact greece may bring them all down the mountain or do they just let greece go?

what actually happens in coming days is going to determine which side is right. already, we're not seeing very many signs of stress in the world finance markets. we're not seeing spanish interest rates rise or italian yields rise at least not sharply. so far, greeks appear to be losing some type of leverage. we'll see if that brings them closer to the negotiating table. at the same time if we start to see contagion in the markets, then you may very well see the other euro zone finance ministers start to give in to some of greece's demands. for "nightly business report," michelle caruso-cabrera. back now to the big move in the bond market and the ten year which is seen its yield hit a low last month of 1.68% back above 1.2% today. is this the start of a bigger move up? let's bring in jack macintyre with brandywine global and investment management firm with 63$63 billion under management.

welcome. >> good to be here tyler. >> was today's move a sign of something to come or a technical move of some sort or the the building of a range? what do you think? >> yeah. i think it's probably the latter. but you have to remember. so january was equally as good an environment for bonds as february setting out to be kind of a negative environment. i think typically when you see that kind of price action the market's kind of going through a digestion period and ultimately i think we're just kind of forming a rage. >> you might have thought today afr those greek talks seemed to run into snags over the weekend after the horrible news of out of libya involving those christians who wereri executed by isis and the renewal of fighting in the u.k. that money would have gone into u.s. treasuries today, but no. >> yeah. you would have thought that. again, i don't want to be that bearish in treasuries because i think we're still globally in a growth-challenged environment, but we are starting to see some

better data points. not necessarily the u.s. but away from the u.s., particularly in europe. that's something we haven't seen in a while. so maybe, just maybe, the bond markets are kind of focusing on the improving business cycle in europe and if that's the case then you're going to see yields move up a little bit higher. >> so where and how can i make money in bonds this year? >> well that's the ultimate question because it's not just about trying to forecast where yields are going to go. do you make money in fixed income and your viewers have a lot of exposure to fixed income. so the way that we are anticipating making money for our clients in outperforming is not invested in german bonds and japanese bonds and u.s. market treasuries but there's still some bonds that have too much inflation expectation price in them. it's the mexicos, the indonesias indoas the south africas and even brazil. a little more volatility in some of the markets but ultimately if you're telling me how you're going to make money in 2015 you've got to be invested in

some of those bond markets. >> picking mexican bonds, feels like doing your own brain surgery. this is something to leave for guys like you and professional fund managers right? >> yeah. that's an excellent point. i don't want anybody to go out and start trading in bonos. but i think you need to start broadening out your universe. and diversify your funds. >> jack thank you very much. with brandywine global investment management. investors are also watching another part of the world that does tend to move markets, at least recently. that is ukraine. that country's army and russian-backed rebels are ignoring that cease fire agreement between russia and ukraine. it was supposed to start on sunday. now, fighting has eased in some areas, but troops refuse to pull back their heavy weapons as a battle for a railroad town in eastern ukraine escalated today. well now to washington where the government strieing to

identify individuals to prosecute for their role in the financial crisis. attorney general eric holder today asked u.s. attorneys who brought cases against institutions related to the mortgage crisis to identify individual employees to prosecute as well. >> i asked the u.s. attorneys who have made those cases and are still involved in these rmbs cases over the next 90 days to look at their cases and to try to develop cases against individuals and to report back in 90 days with regard to whether or not they think they'll be able to successfully bring criminal or civil cases against those individuals. >> the ultimate decision to prosecute however will be up to loretta lynch. the nominee to replaceholder if and when she is confirmed. well the justice department will also appeal a legal ruling on immigration, an issue important to many businesses after a texas judge temporarily blocked president obama's immigration orders.

probably recall late last year the president announced executive actions aimed at protecting millions of undocumented immigrants from the threat of being deported. the judge's ruling backs 26 states that argue the president that overstepped his legal authority. well brent crude rose to a 2015 high. it was another strong day in the oil pit. worries about instability and iraq two producers, overshadowed concerns about too much supply hitting the market. west texas intermediate crude up 75 cents, $53.53 and brent climbed to almost $63 a barrel but it was the massive fire from a derailed train carrying crude that got people talking once again about how to safely transport the commodity. jackie deangelis has more. >> reporter: two more big accidents involving trains carrying oil over the holiday weekend. the first occurring in canada's oil sands. the second derailment taking place inest virginia

yesterday. no serious injuries have been reported but the second accident 25 cars derailed. 20 burst into flames. that csx train was carrying crude from north dakota that's the heavier more flammable type of crude that sparked a debate and action by the national transportation safety board to propose new rules to overhaul crude by rail safety standards including heavier duty cars and slower travel speeds. and while the new safety rules are still being discussed and await approval, the industry is preparing for them already beginning to halt older rail cars but the csx train involved in the accident was actual a newer model car leaving some with raised eyebrows. it's not a new debate but reemphasizes some old questions. one being, are pipelines like the keystone pipeline safer to transport crude and many people asking if the ntsb is doing enough fast enough to prevent

these incidents. for "nightly business report," i'm jackie deangelis. >> and joining us now to talk more about rail safety is peter geps. senior vice president at o'neil and associates and former managing director of the national transportation safety board. peter, welcome. good to have you with us. i don't want to wade into the question because i think it's been con flated about whether the keystone would avoid some of the accidents we have seen on the rails including the one yesterday in west virginia for a variety of reasons, i don't think that argument holds water f you will. but let me put the question to you. per volume of crude, is it safer to transport via a pipeline or safer to transport via a rail? >> you know, both methods of transporting oil are extremely safe. i mean 99.995% of all oil tank cars reach their destination

safely. that's a pretty good record. and pipelines also do a good job. so this debate as you pointed out earlier, between which is safer, really really is not the debate. i mean we need both. we can't move the bock and oil out simply by pipeline. you've got to have rail. rail can deliver the tank cars to refineries other than in the gulf coast. so we need a mix of both. >> because most of the pipeline carried oil, pipelines basically run down the center of the country north and south, not to the east coast refineries not to the west coast refineries. the increased volumes that have been carried by rail have been well documented. we've gone from i forget what it is 50,000 barrels to 450 or whatever it is. it's huge volumes going by rail but has the industry and the government kept pace in terms of safety? are the cars able to withstand derailments? are they up to standard?

>> well, you know the rail roads have been proposing stronger rail cars since 2011. femsa has not issued the final rules yet and i think they're a little slow on that. i think the cars can be made safer but it's a matter of physics. you cannot make armored cars that will be absolutely indestructible and move them in a timely manner. so there's a certain amount of risk. it's very low. you want to mitigate it. in very cold weather as in very warm weather, it presents challenges sometimes to railroads. and you need more inspection. they're doing it. but, you know, the end result is -- >> you do seem to feel as though the government has not come forward quick enough in mandating stronger with thicker steel insulation if you will

of the cars correct? >> i think femsa could have put the rules in place in a more timely manner. >> one more quick one. obviously, pipelines have accidents too. several hundred a year here. many of them are small. is it fair to say that a pipeline accident doesn't maybe get as much play as a rail accident because those accidents are unseen in remote areas and less likely to kbus? >> absolutely. a rail car carries about 28,000 gallons of crude, and when it's involved in an accident and it ignites, it's a wonderful visual. in pipelines, when one lets go you talk about barrels. thousands and thousands of barrels of oil. and it's a far more damaging event often to the environment. >> all right, peter. thank you very much. we appreciate your help tonight.

peter gelps of o'neil and associates. >> it's is itthe start of the spring selling season but will it be enough to heat up the housin student alone delinquencies increased at the end of last year. bank of new york says 11% of student loans were delinquent in

2014. total student borrowing stands at $1.16 trillion and according to the same report younger americans with student loan debt are less likely to buy homes and take out mortgages than those who don't have it. confidence among u.s. home builders slipped in february down to the lowest levels in october. this as builders used the president's day weekend for special sales to kick off the historically robust spring selling season. what's standing in the way of more hope for housing? diana olick has our report. >> reporter: the home builders association is blaming the drop in its monthly sentiment survey on this. just as they did last year. frigid cold and snow weighing heavy on the housing market. but gary chandler division president in northern virginia points to cold hard fundamentals. >> the job growth has been sluggish and people just don't seem to have the urgency that they had a year or two ago. and so that's really what we

need to see back is the urgency. >> reporter:uroverall, builders' sentiment slipped in february but it's still positive and well above where it was last year. the biggest drop in the survey was the component measuring buyer traffic through model. and that was pretty clear this past saturday at a khov in maryland. one looker in five hours and she didn't want to be on camera. the problem is high prices. builders have been focusing on higher end homes because entry level buyers either can't save for the down payment or can't qualify for a loan at the lowest rate. >> so you have prices going one way and the demand going another way that creates the divergence we last saw in 2007. >> reporter: in january, median build was $98,100. 43% higher than the median price tag for a new home. >> everybody is looking for value, so we strategically try

to place incentives in every community that really maximizes square foot value to our customers. >> reporter: but incentives may not be enough especially now as interest rates are moving higher. just today in response to the jump in bond yields mortgage rates added an eighth of a point. we're just halfway through february and so far, we've seen the biggest monthly rate bounce in six years. for "nightly business report," i'm diana olick in washington. >> one city that has a red hot residential real estate market is san francisco. as our josh lipton reports, the commercial real estate market in the city is also booming big time. >> reporter: the red hot residential real estate market in silicon valley might attract all the headlines, but the commercial real estate market in san francisco also is booming. just take a look at the city's skyline, which is now dotted with cranes. between 2009 and 2011 the city

issued just 13 permits. between 2012 and today, the count's back to 87. those cranes are used to develop office buildings where asking rents now average $63 per square foot. more than double the national average according to jones langlafoun a real estate company. prices skyrocketed nearly 90%. when prices surge that quickly, some might worry that a bubble is developing in this market but real estate developers in san francisco strongly disagree. >> we believe in this market having long long-term legs. we don't believe silicon valley is going away or san francisco is going away. if an adjustment occurs, ironically it's good for our business because that means pr down. we can go do more transaction. >> reporter: one industry is

driving demand for office space in the city by the bay: tech. sales force is the leader with more than 1.5 million square feet. twitter comes in second and google follows closely behind. high-flying start-ups also control a lot of office space. for example, uber plans to move into a 420,000 square foot campus in the mission bay area of san francisco. right now, there's more than 3.5 million square feet of office space under construction and nearly 60% of that space is already leased. real estate analysts contend one potential concern is that the commercial market is so dependent on the health of tech but the momentum and commercial real estate prices they say, remain very strong. at least for the forseebl future. for "nightly business report," i'm josh lipton in silicon valley. market focus time. we begin tonight with verizon.

it has it has no need to make large spectrum purchases in the near term. this comes as the company won more than $10 billion of wireless licenses at a recent auction. verizon said it's going to focus on technology that makes use of its current spectrum holding given the high costs. fell to $49.18. medtronic, deliver for investors as it had strong sales of cardiovascular devices, most notably. the stock one of the best performers in the s&p up 4% to $78.07 a new 52 week high. cvs health raising concerns about the possible impact of a new class of specialty cholesterol drugs. the company which negotiates drug prices for millions warns specifically the new cholesterol drugs could eventually cost the health care system as much as $150 billion a year. shares were up a fraction to $103.55. fossil announced fourth quarter

results that missed the street's estimate sending shares way down initially after hours. the watch and accessories maker blamed head winds and a ten year licensing agreement with kate spade. you can see the stock plunged after the close. look at it fall off the shelf there. before the bell off a fraction at $99.32. it was the opposite story for boston scientific. that company announced news that investors liked. it reached a $600 million settlement with johnson and johnson over a breach of merger. the lawsuit was brought by j and j with guidance that boston scientific acquired. shares popped initially in after hours trading before the marketed closed shares were off slightly at $14.84. coming up, from toys to cars. why some consumers may soon be in the cross hairs of that west coast port labor dispute.

the west coast ports have reopened after being shut down other the holiday weekend. labor secretary tom perez is in san francisco meeting with both sides trying to resolve the dispute that has disrupted billions of dollars in international trade. at 29 sea ports from seattle to southern californi several automakers start to adjust operations as a result of the dispute. honda will slow in ohio, indiana and canada because of shortage of critical parts. reduced overtime and the head of the group that represents the motor vehicle zplier industry said if the disputes drag on much longer the consumers will

feel the impact. >> it's not purely an issue of imports because our industry motor vehicle suppliers, export over $60 billion a year to pacific countries and so it's not going either way. so it's having a significant impact on the industry and if it's not resolved soon that impact is going to be felt very acutely at the consumer level. >> if the ports were to shut down some estimates say it could cost the economy $2 billion a day. the port dispute is one of the hot topics at the north american international toy fair. that's the toy convention of the year. morgan brennan got the assignment. >> reporter: frigid temperatures didn't stop more than 20,000 toy enthusiasts check out the trends at the toy fair of the year. hello, barbie. welcome to new york. >> i love new york. don't you? >> reporter: everything from talking barbies to toy cars were on display.

u.s. toy sales grew 24% in 2014 to $18 billion. driven by blockbuster films like froezen, the lego movie, teenage mutant ninja turtles and transformers. building blocks and drones take a center stage at the fair. >> the industry grew 10%, which is huge. we don't typically see that kind of growth in the industry so we're off to a really great start. >> reporter: high-tech toys continue to gain ground. one of the hottest trends is the so-called maker movement or do it yourself toys. >> those are toys that really empower kids to create whether in science or baking arts and crafts building. so the industry has seen a lot of success over the past couple of years in the building category specifically. showing double digit growth from 2013 to 2014. >> reporter: disney's frozen star wars and paddington bear

the fastest growing portion of the industry. $26 billion in royalty revenues that's the trend expecting to continue in the next year as well. >> licensing in the toy industry is strong. we look at a healthy base and as we move in to 2015 and look toward summer and the holiday, the number of big movies the number of tv shows, a lot of other things are really contributing to a really good outlook. >> reporter: but it's not all fun and games. a court stoppage meant new challenges for makers including the licensing for padington bear. >> you can't move christmas day. we had to have product get to the retailers by cancel dates and it cost us tens and tens and tens of thousands of dollars. >> reporter: when it comes down toyota america loves classics whether it's padington bear or lego now the biggest toy maker in the world. for "nightly business report," i'm morgan brennan in new york city. and finally tonight, lego

has been named the most powerful brand in the world. a new study by the consulting firm brands finance based rankings on things like familiarity, loyalty, corporate reputation. the study said the lego movie helped move the toy company into the top spot. apple, by the way, topped the list of the most valuable brands. and that's "nightly business report" for tonight. i'm tyler mathisen. have a great evening, everybody and we hope you jo.

[ ♪music♪ ] >> that is a macrame of sacajawea? [laughter] >> sometimes the only way to communicate is through humor. >> andrew kleindolph: you know, some people's approach that just to get angry about it. but for me, it's just sort of to blow off steam. >> a sly view on this episode of spark. [ ♪music♪ ] >> major funding for spark is provided by the william and flora hewlett foundation supporting creativity and innovation in the arts since 1967. and by the kqed campaign for the future program venture fund with additional support from the walter and elise haas fund the george frederick jewett foundation the marin community foundation the koret foundation