this is "nightly business report," with tyler mathisen and sue herera. wall street jumps. stocks take off as investors applaud the dollar taking a break from its fierce rally. oil slumps. crude hit the lowest level in six years. a top strategist says what happens next and what may happen after that. the federal reserve meets this week. will the central bank tweak its interest rate hikes. all that and more for march 16th. welcome. stocks got a jump on st. patrick's day today. the major indexes were all in the green, fueled by a weaker dollar and a better than 2% drop in oil prices. the pullback in the dollar was welcomed since the currency has risen about 12% so far this

year. and it has pressured stocks heavily at tim. the rising dollar can sap the profits of big companies that export or do a lot of business outside the u.s. yet the strength of today's rally was a bit of a head scratcher. it really wasn't that much news to drive s the dow was up 228 points to close 17,977. the s&p 500 went along adding 27. >> the rally caught some by surprise considering there's a meeting of the federal reserve this week. usually investors go into a holding pattern until after the meeting. but, oh well not today. anyway the big theme this week when dealing with interest rates, will the fed continue to be patient. >> reporter: leading market analyists, economists and fed watchers say when it comes to the federal reserve, patience may no longer be a virtue. fed watchers anticipate a new watch word on the road to

monetary policy changes in months. when janet yellen and her monetary policy makers wrap up their two-day meeting this week they will use new language for a possible hike in interest rates from record lows. >> the key here is they're going to probably lower the inflation expectations component. three months between march and june. >> removing patient from the fed guidance does not make a june rate hike a lock. and that the first rate hike will be small. 25 basis points perhaps, with policy makers adopting a wait-and-see attitude before going higher. while the strong job market with unemployment at 5.5% is at the upper end of the fed's full employment mandate, inflation is well below the fed's target. leading economists say the surging dollar could complicate the fed's decision on the timing

of that rate hike. the rise in the dollar has been extremely abrupt. and i don't think the fed is particularly worried about a dollar that's rising but they don't want it to happen in such an abrupt fashion that it could be destabilizing to global financial markets. >> reporter: in the fed statement, and post-meeting news conference look for fed chair janet yellen to avoid telegraphing a timetable for a rate hike and flexible could be the new watch word for monetary policy makers. now, back to oil, where u.s. crude hit its lowest level since 2009. oil had been rising for more than a month. but it's been slipping again lately. today the concern was with the supplies keep going even though more rigs have shut down lately and a nuclear deal with iran will have sanctioned crude hitting the ma.

brent fell it was down more than $1. well with the big topic in egypt this weekend as well at a conference aimed at bringing some big investment money to that country. one big oil ceo didn't pull any punches. hadley gamble has mo >> reporter: basically what we've seen over the last few days is an outpouring of support for egypt. this country is open for business that he would do the necessary reforms so investment would come back to the country. that's just what we're seeing now. we talked about the oil market for the outlet on oil. i asked given the current pricing environment, how that is impacting his investment strategy. >> it's a world of luxury. we've been in $100 oil for three or four years. it's an unusual period.

we're back in a normal world of volatility of oil and gas prices. we're down now today, as of friday $54 brent, $44 in the united states. this is a huge shock f o cost structures are going to have to move and change. taxation is going to have to move and change. it's going to be very painful. >> reporter: incredible buzz surrounding this investment conference here in egypt. there are still questions about security. they want to know their money is going to be safe in this country. president sisi saying business is still open. for "nightly business report," i'm hadley gamble. joining us now to talk more about oil is samir samana with wells fargo investment institute. good to have you with us. welcome. we promised at the top of the broadcast that you'll tell us what happens next with the price of oil and what happens after that.

so go ahead. >> in the coming months the most we can say is prices will remain volatile. we've obviously seen the low 40s, back up to the low 50s, and then back into the low 40s. it could get into the 30 $35 area because that's where a lot of the producers start to sweat it out especially in the u. in the near term probably much more volatility. but that probably gives way to underinvestment. a little bit less production. as demand comes on in the second half of the year probably higher prices. >> how much higher if indeed that demand does come in the latter part of the year? what's your upside target for oil? >> you know we've got a year-end target of $60 to $70. but that might be probably something that spills over into the first half of next year. but we do think fair value for oil prices much much higher. but all the different concerns about higher supplies where to store it all those different things are really weighing on the price of oil. and almost nobody's talking

about the demand side. >> where does the demand come from if it comes back? >> probably the biggest thing that will start to come back very quickly is you've had a lot of refinery outages. the explosion in california a strike in the western part of the country. right now the incentive to produce gasoline using brent crude especially is about as high as it's been in the past five years. as soon as the refineries get back online they will pump out a lot of crude. another would be china. they've got a strategic petroleum reserve, much like the united states which they just started not that long allege. they've got a lot of room still left to store more oil. you've already heard some headlines around tankers heading to china. they could start to build that strategic petroleum reserve in a much bigger way. but also you could see with europe rebounding a lot of demand on that side as well. >> what about the drop in oil that we've seen being somewhat

disorderly? not extremely disorderly but there is worry out there that perhaps other asset classes might be affected by that. is that a worry for you? >> you know it's always a concern. i mean a lot of the financial crisis can be traced back and spread outward. anytime a big liquid commodity like oil goes from $1.07 last year to low 40s, there's going to be some pain. then you wonder people will sell in stocks that have done really well maybe they hold on to their oil, and things might start to spread outward. you still see stocks and bonds doing really well. it's isolated to energy right now. >> i thought it was interesting when you described why demand might come back. it really wasn't apart from europe that you see the economies around the world strengthening in any big demand producing way. >> they're coming back. albeit slowly. that's always how it works outside the u.s. is things come

back a lot more slowly. china is obviously a big issue right now with them guiding growth to about 7%. but honestly once the growth does start to stabilize, people might be surprised how quickly they come back some of the commodity markets, and take advantage of the lower prices. >> very very quickly, where is the real pain point for this industry? is it below $30 a barrel? >> it seems like it is in the mid-30s area. if you look at the oil producers and who can really cut back it's going to be the nongovernmental producers. obviously they're very reliant on oil. they almost have to produce more when the prices go down. but in the u.s. you've got the sales guides low 30s to high 70s is where they tend to produce. but really it's the mid-30s where they pull back sharply. >> thank you. >> thanks for having me. another country feeling the pinch from cratering oil is russia. the fallen oil is hurting that country's currency and hitting it very hard.

>> reporter: let's take a look at the performance of the russian markets, whether it's the ruble against the dollar. it is the falling oil price, again, that has done most damage over recent sessions rather than speculation surrounding president putin. the ruble has risen, as we know since the five-year lows in 2014. the misex has been one of the better markets over the beginning of this year. the disappearance, or otherwise that the president largely ignored by these markets. today, though we did find out the president is alive and well. he appeared at the press event, this meeting with the president of kyrgyzstan. it was a scheduled event in his diary. he is well pushing speculation

around his ill health. one thing to note in passing, a little bit of disturbing news today. the northern fleet here has gone on military maneuvers, meaning the mobilization of 40,000 troops whilst western leaders may have b uncomfortable with the story of the president's disappearance. they'll feel even more uncomfortable knowing that these maneuvers are taking place. this is jeff cutmore with "nightly business . at least one positive in the oil patch to tell you about tonight. as the comeback continues in the gulf of mexico nearly five years after that bp deep water horizon accident this time it is chevron making a push deep into the gulf. the company has successfully launched its $4 billion bigfoot platform. the platform is going to take eight to ten days to reach its new home in the gulf. it's towed out there.

it's approximately 225 miles south of new orleans. it will be in a field containing an estimated 200 million-plus barrels of petroleum. chevron expects to see the first oil and gas from it later this year. here we go again. the federal bor borrowing limit has been reach. now what. joining us is john harwood from washington tonight. i guess that really is the key question john, what happens next? >> well sue, as you just indicated, the treasury department has several months worth of what they call extraordinary measures which prevent them from breaching that borrowing limit. we expect those though run out october, november maybe. then you'll have the question of whether the republican party is going to try once again to go to battle with the administration over the debt limit. my bet is that they don't, or they fake it for a while, and then cave.

but we're going to find out. and a lot of people getting nervous about it. >> how divided is the republican caucus in the house and the senate because on the one hand they tend to want to go back to those 2011 spending limits on the other, they don't want to be seen as shirking on expenditures for the military. >> tremendously divided, tyler. especially between their leadership and the more vocal and active members of their base. ted cruz in the senate a couple dozen people in the house of representatives. remember we had a debt crisis in 2011 which ended up with a downgrade for the united states. republicans decided at that time hey, we can't do that again. president obama took a stance subsequently of saying i'm not negotiating over this. counting on republicans to be afraid of that. that's worked the last couple of times they've had to deal with the debt limit. now, mitch mcconnell and john boehner said after they won both chambers of congress we're not

going to have any government shutdowns either. and we just flirted with one at the department of homeland security. so it's not clear whether the base is going to take the signal. but this is a more volatile issue. and i think the leadership is going to try harder to prevent it. >> is there any worry on the hill it could be destabilizing to the financial markets, john? >> no question. and the feedling of the republican party is they'll be pinned with the deep stabilization. i can tell you that the white house is saying yes, there will be noise made about this ultimately republicans will back away from that bite. >> john harwood, as always, john, thanks so . coming up how soaring rents are making an already crowded housing market even more

u.s. home builders feeling a little less confident these days. the index fell for the third straight moment. we close in on the peak spring selling season. >> despite that dip in confidence a surge in home buyer demand especially among current renters is overwhelming the spring market. with little for sale buyers are crowding into open houses and bidding wars are so what does it all mean? diane has the story. >> reporter: at a recent open house in northern new jersey -- >> one of the nicest pieces of property. >> oh yeah. >> reporter: -- the stories were remarkably similar. >> along with the better market there's more competition. >> what we're looking for is not there. >> reporter: city to city neighborhood to neighborhood spring demand is coming out with the sunshine but there is too little for sale.

>> not just the inventory, but the fact that we anticipate that interest rates will rise. so as the interest rates rise and people fear losing those good rates, more houses get sold more quickly. >> reporter: rising interest rates, and rising rents are pushing demand. about 5.2 million, or more than 12% of current renters in the nation's 20 largest markets say they plan to buy a home in the next year according to a new survey. that's a big jump from a year ago. the trouble is these renters are facing rising home prices in a still tight mortgage market. there are, however, new low down-payment options that have been slow to start, but which could help this spring. >> by the time you roll the systems out and get customer attention, we're now only beginning to see flow of activity coming into it. >> reporter: which will only add to com this couple sold their new jersey home in just four days.

expecting to buy another one quickly. that was january. >> a lot of houses almost exclude because of people you feel it's putting houses out there in ridiculous numbers. you have to eliminate that. they're just throwing it out there. for realistic houses realistic numbers, it's not that much at all. >> reporter: they now have to move in with his mother while they continue their for "nightly business report," i'm diana oleck in washington. the takeover bal for salex pharmaceuticals. val yent upped its offer to more than $11 billion in cash beating out endo international. endo said it still has a robust deal pipeline that it may have other acquisitions in mind. shares of all three companies ended higher today, as you see there. general electric selling off a financial business for over $6 billion.

shares of ge up more than 1.5% to finish at 2545. promising study results help lift shares of three drug makers in the process of developing cholesterol treatment to cut in half the risk of heart attack and other heart ailments. shares of all three drugmakers popped by more than 3%. lifetime fitness taken private in a deal valued at more than $4 billion. gym operator has been under pressure from hedge fund mercato capital management and said it was exploring a potential sale of its properties. the stock rose 5% to $70.68. sotheby's named madison square garden's ceo as its new president, and chief executive. this is the auction house that has been pressured by activists to improve its profitability. netflix saw its shares tumble

after an analyst downgrade. the research firm evercore cut its rating to sell to hold pointing to an intensely competitive environment. the stock fell almost 4% to $421.97. investors getting a chance to react to news that avon products will be removed from the s&p 500 after being in that index for 50 years. the cosmetics company will be moved to a mid cap 400 index at the close of trading on march 20th. it's been one of the worst performers in the benchmark index index. today it s the worst performer in the s&p falling to $7.28. after the bell standard & poor's said american airlines will be added, replacing aller erlerallergen. shares of american popped initially in after-hours trading, before the close the

stock was 2% higher to finish at $50.22. edwards life sciences was today's best performance on positive study results. it found one of the medical device makers' heart valves found lower deaths and stroke rates among its patients. the shared surged about 10% to finish at $148.64. with hack attacks on the rise so too, is the number of companies buying cyber insurance. mary thompson has more. >> reporter: another year of headline-grabbing cyber attacks on big name companies like sony another year of double-digit growth for cyber i. >> cyber insurance could be one of the biggest opportunities in recent memory for the insurance market. >> reporter: a recently released survey by the insurance broker marsh shows among the u.s. clients, first-time buyers rose 32% last year building on a 21%

increase in 2013. among the industry seeing the most growth and first-time buyers? hospitality and gaming education and power and utility. information is increasingly valuable. roughly $2 billion industry cyber insurance is still in its infancy. the insurers offering these policies including aig, chuck and hartford all continued to tweet their underwriting. randy bitter says it requires policy owners to make adjustments of their own. >> even if they get an insurance policy to cover the cyber risk the insurance company is going to require them to have processes, technology reporting struck structur in place. the policy should mitigate any disruption to a business and the cost of helping customers impacted by an

attack. as the cost of the policies rise marsh said they rose 3% last year firms may choose to self-insure instead. posing a risk to the rapid growth of cyber insurance. for "nightly business report," i'm it has been the launching point for some of technology's hottest startups. what's turning heads this year at south by southwest? we'll head there, next here's what to watch tomorrow. federal reserve begins its two-day meeting and everyone will be watching to see if the central bank removes the word

patient from its statement, which could mean interest rate hikes are getting closer. on the data front, housing starts in february are due out. and after the market closes oracle and adobe will report earnings. >> the social media app pinterest raised $367 million. it makes it one of the most highly valued startups out a lot of people talking about that. a lot of people also talking about south by southwest. that's the annual conference where members of the music, film and technology industry gather and it's where twitter tipped to the mainstream and four square made its name. what is the buzz this year. >> reporter: the hottest app in south by southwest allows people all around the world to feel like they're here. it's live streaming video app. >> everybody's talking about mere cat. it's a live streaming app.

hold your phone up broadcast whatever is in front of you, whatever you're doing and people can follow you in realtime. like tuning into a personal tv channel for anyone with a smartphone. >> reporter: with prominent investor of a startup bubble south by southwest wants to be more than the just latest social app, for truly revolutionary innovation. in the spotlight, a robotics petting zoo. showcasing robots designed to help in disasters like hurricanes. but the founder says that's just the beginning. >> they're going to move at an exponential pace. i'm sure in the next year when we have this conversation again, you'll probably have a robot. >> reporter: another winner of the convention's first-time innovation award, a company whose 3-d printers create flesh printing out the likes of an ear. >> for the first time ever you can test compounds and drugs on

three-dimensional human tissue without ever testing it on a human. >> reporter: there are big brands from capital one and at&t to pepsi and mazda. they're here to reach out to the trendsetters as well as pick up on some innovation themselves. first-time sponsor mcdonald's is hosting pitch competitions for areas it wants to innovate in including food packaging and dlif delivery. >> south by southwest for mcdonald's represents a really good opportunity for them to really engage with cutting edge innovation. >> reporter: in austin known for its foodie scene, mcdonald's has drawn criticism for the way it's handled its sponsorship. >> kind of greasy don't like it too much. >> reporter: everybody wants in on the cutting edge ideas here on south by southwest. and finally, the ncaa men's basketball championship or as

you probably know it march madness, tips off this week. and americans have a lot at stake. they will wager an estimated $9 billion on the tournament. according to the american gaming association, that is. if you think it doesn't hit the bottom lines of businesses nearly 80 million workers will waste at least an hour on march madness on their boss' dime. >> that's no waste. this is important. >> i was just going to say, we would never do this. but you don't think it's a waste, right? >> no. i'm pulling for virginia. that will do it for "nightly business report" tonight. i'm tyler mathisen. thank you for watching. >> i'm sue herera. we will see you tomorrow.

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