. this is "nightly business repor report". >> all it takes is a spark. one idea to take flight. the courage to seek the unknown. to innovate, disrupt, to move us all forward. to explore a different perspective. at nasdaq, we connect the world. it is ideas, it's capital, it's businesses. the people who drive global economy. the future of tomorrow. all it takes is a spark. nasdaq. up, up and away with the major averages and new highs, should investors start picking stocks for the best returns? trade talks. japan's prime minister heads to

the white house as the first and third largest economies had try to forge a new economic relationship. oil rush. prices have more than doubled in a year. what happens snex a little less clear. this is friday, february 10. good evening, everyone. i'm sue herera. tyler mathisen is off tonight. investors owned a high note. the three major averages push further into record territory. the climb started yesterday with talk of tax cuts and continued today when president trump mentioned infrastructure investment during a visit with the japanese prime minister. the dow jones industrial average added 96 points to 22269. the nasdaq added 18 and the s&p 500 was up 8. for the week, stocks were higher across the board. and as morgan brennan reports, the focus is squarely on washington. the trump reflation trade is alive and well. that is investors are betting

donald trump's policy there's lift inflation and growth. it was after a meeting between the president and the japanese president shinzo abe. that gave industrial stocks a boost lifting names to new highs. lately, the markets have rid risen on just the near mention of tax reform or infrastructure spending. when issues like immigration and trade wars are on the table, they tend on drift slightly lower, suggesting the path of least resist daniel for stocks is higher. at least for right now. today, trump seemed to alleviate concerns of any tensions with either china or japan. the second and third largest economies, saying he had great almost for both countries and very warm conversations with both nations' leaders. another issue, earnings. next week will bring a lot more of them and that along with

washington could determine direction of stocks. for "nightly business report." at the new york stock exchange. >> and this morning it was reported the u.s. relationship was on display today at the white house. trade between the two countries is worth nearly had $270 billion. so there's a lot at stake for both sides. eamon javers reports. >> with a handshake and a hug,er president trump welcomed plr japanese prime minister shinzo abe. >> we faced numerous challenges and bilateral cooperation is essential. our country is committed to being an active and fully engaged partner. >> the back drop to this session was the relationship that both countries have with china. although donald trump's phone call with xi jinping last night seems to have smoothed things over for now. >> aid very good conversation, as most of you know yesterday

with the president of china. had it was a very, very warm conversation. i think we are on the process of getting along very well and i think that will be very much of a benefit to japan. >> while prime minister abe did not directly address china in his remarks, did he allude to global trade frustrations. >> translator: look at steel. overproduction in a certain country has not ceased. there are as consequence, in export results in a price for steel worldwide. >> meanwhile the president seemed to offer a prediction of sorts for global currency markets. >> as far as the currency devalley waigss, i've been complaining with that for a long time and i think that we will probably sooner than people

understand or think, we'll be all on a level playing field. but it has to be fair. and we will make it fair. >> the two leaders departed for a weekend to mar-a-lago dubbed the winter white house where they are going to continue their discussions. the president will be personally paying for this trip to florida. it is being described as gift from the president to the prime minister and his wife. for "nightly business report"." the white house. >> one specific conversation between zprump the prime minister was trade. for the two countries, that means discussing japaneser automakers. today abe says the auto industry and other countries looking to invest in the point u.s. >> when japan's prime minister are shinzo abe and president trump talk business, the question of how much japanese automakers impact the u.s. economy will focus where

japanese branded cars, suvs and trucks built. last year, more than two-thirds of the vehicles honda sold in america were built in america. a far greater percentage than nissan and toyota. why does that matter? because donald trump wants all auto makers to build their vehicles in the u.s. that includes the japanese who sold 6.6 million vehicles in america last year. meeting with reporters, trump and abe did not specifically talk about japanese automakers. while pledging to work on trade deals between the two countries. >> on economy we will seek a trading relationship that is free, fair and had reciprocal, benefiting both of our countries. >> while abe abe realizes had president trump wants more jobs in the u.s., that doesn't necessarily mean japan will export fewer vehicles to america. but it could mean japanese auto

make letters open more plants in the u.s. where they have more than 25 manufacturing sites. at the same time, japanese automakers have been expanded in mexico where many of the vehicles made ultimately are shipped up to the u.s. and donald trump has made it clear, he wants the vehicles sold in the u.s. to be made in the u.s. "nightly business report." chicago. >> think back about one year ago. the markets were pretty much a mess. some well known businessmen the foresight and the stomach to buy shares as their company stocks tumbled. and their bets paid off. >> one year ago, jpmorgan chase, jamie dimon bought half a million shares in the stock. he has made $16 million on that investment so far. but dimon wasn't alone in buying shares at the bottom. we looked at the transaction filings and found a few other heavy hitters were also buying.

namely, steve mnuchin and warren buffett. they are now worth $5 million more today. the biggest buyer wasser berkshire hathaway. it bought part of a larger accumulation of a company. the key things buffett did not panic when markets dropped. instead, continuing to buy more. just that one february purchase has earned more than $6 million. we found one big name buyer earned a higher return than dimon. steve will nguyen's purchase of his own company is up 67%. not bad for one trade a year later. and then there's elon musk who may have had the best trade of them all. he bought solar city a year ago. sold it for tesla stock in sxaug then saw tesla shares rise even more. in total that original purchase has made him $7 million. had nearly a 70% gain.

for "nightly business report." >> and it's not just the inislanders seeing gains with. the major averages at new highs, there's growing belief fund managers could have a good year and there is early xags january was good year for them. so is stock picking making a comeback? a writer at fortune magazine joins us now to talk about. that jen, welcome. nice to have you here. what are you hearing from the managers you're talking to? >> the first thing, it is really important to say that active managers have been so excited to say how well they are doing and to make the case for active management after having a really bad, in ten years, when he they haven't beat the market. they're be the first ones to tell that you they're a comeback. >> but thatter in this case, we know the administration has kind of singled out certain indices that it wants some big changes

in. so what are they looking at favorably given the run-up we've had? when & what are they avoiding? >> what really been fitted them, they have tilted toward financial stocks, technology, bank stocks. technology has done really, really well because the fed has raised interest rates. the rates had continue to go up. so they have double much better than certain defensive sectors like utilities. high dividend stocks. retail has not done very well. so the benefit is that if they had been tilted heavyly to banks and technology, they've been able to beat the market or the broad based indexs where they're invested in everything. >> wha >> health care and the repeal, has been extremely volatile do many favor that with the new

pl plan's anticipation? >> and into pharma too. there's uncertainty over whether the trump administration will try to enact some price regulation as far as drug prices go. people really don't know what will happen to obamacare right now and what that will look like for sxhols medical devices stock. so people are very, very reluctantly wading into health care. >> this is tonight say that etfs have not done well. there is still money flowing in. >> oh, yeah. black rock hit the high levels last month. so people don't expect to it stop any time soon. glrg warren buffett has endorsed index. >> thank you for your perspective on that. this joining us tonight with fortune magazine. oil output is plunging, the result of steam cuts made by oil

producers to help alleviate one of the largest oil gluts. the dmarkt rise to more than $53er. as jackie reports, it was much different story a year ago. >> it happened to be a bottom for crude oil. this time a year ago, oil prices saw a low near $26 a barrel. since then prices have more than doubled. lower prices closed down a lot of shale production which cut the buy and pushed prices up. and opec finally announced the production cut late last year. there were also doubts as to whether members of the cartel would cheat. that doesn't seem to be the case. they've carried out 90% of the promised production. >> so they're concerned that escalating tensions between president trump and iran could as well. combine that withment on m menmn

that mix. the shale threat remains real. higher prices means more of that production will come back online. u.s. recounts were up almost 10 ners january lows. production in the u.s. has bounced around and the numbers are creeping up. >> opec can't do much more for very much longer. there's not a lot of coordination. the saudis are taking the pain. meanwhile the prices go up a little more. shale snaps back in a big way. the producers here are the united states ultimately. not the saudis, not the opec states anymore. and trump's policies are clearly favorable for cheaper production costs and therefore more production gains out of the united states. so on balance, despite all the geopolitical tensions in the world, i think that energy looks more bearish than bullish. >> the federal reserve official

in charge of regulation will resign this spring. daniel tarullo who has worked at the central bank it's single 2009 did not give a reason for his departure. it gives an opportunity to reshape the board. and there are reports late today that the white house is not planning on taking its immigration order to the supreme court. last night, we told that you an appeals court upheld the block on the president's travel ban. still ahead, is there potential trouble brewing in europe that investigators. >> investors need to pay attention on?

the food and drug administration approved a treatment for muscular dystrophy, a rare type that we've been reporting on. the drug is made by marathon pharmaceuticals and is the first to win fda approval. even though it has long been available outside the u.s. the new list price for the drug is $89,000. that is 70 times higher than its price overseas. the drug is not a cure but it has been shown to improve muscle strength compared with a placebo. president trump's proposed wall along the u.s. mexico border could costly nearly $22 billion. as first reported by reuters, it could take about three and a half years to build. the president's executive order includes plans to hire more border agents but that has proved difficult to do. as kate rogers reported last month. now one high ranging union official said the

administration's focus on the border could make recruiting a little easier. kate is back with the details. >> reporter: president trump's plan to build a wall along the u.s./mexico border may be controversial. but they're feeling optimistic. the council representing some 16,500 border patrol agents. the unit traditionally has not endorsed the presidential candidate threw its weight behind trump in the election. his plan to build the wall with an additional 5,000 agents which may prove to be a challenge for the u.s. customs and border patrol agency which is already had working to fill 1,700 positions. they said policies including catch and release and the deferred action for childhoods arrivals program have inhibited their abilities. >> many people who have left the agency have left because they got sold a false bill of goods. they were told they would be

doing a high speed tactical job and it turned out to be anything but that. i believe agents will get back to enforcing the law and that i think will help to retain people might be thinking about retiring early. or going to a local or state law enforcement job. or another federal agency. >> stop short of a full on endorsement. each will borm sector and station's individual needs should be considered. >> i think you need a physical barrier. it has been shown throughout our history and especially since we started in operation gate deeper that it works. >> they said in a statement, as a matter of policy, we do not comment or confirm potential exist tense of pre additional deliberative documents. the u.s. customs and border patrol did not immediately comment. sears is cutting costs by at least $1 billion. that's where we begin the market focus. after reporting a more than 10%

drop in same store sales for the holidays, the retailer unveiled restructuring plan. it will achieve the cost savings by reducing overhead and improving management. they will cut debt and pension. shares of sears had dropped 25%. the advertising agency interrepublicinte interpublic group had lower taxes. they raised the quarterly dividend 20% to 18 cents a share including the yield at about 3%. shares the rose 4%. shares of skechers continue to rise after that company said late yesterday that international growth drove its better than expected revenue. they saw earnings miss but it did report surprise growth in same store sales. an lists were expecting those to remain flat. they gave upbeat revenue

guidance. shares surged 19% to 27.78. and allstate raised its quarterly dividend. it is up from 33 cents. the annual yield is now nearly 2%. shares rose marginally. from greece to france to italy. is there potential trouble brewing in pueurope that had investors need to be aware of? good to see you. let's start with greece. there is a large debt payment. we've seen this movie before. >> we certainly have. >> are we going to see a repeat? >> that's the concern. because we've seen what happened in the past, this decision has prompted a lot of concern. here's the update. so far greece and its investors have not been able to see eye to eye on the bailout. greece, the government there is coming back saying we want to step away from austerity to see

an economic revival. all this is happening before the sum where one of the biggest debt payments is due. about 7 billion euros. we've seen these negotiations take place until very last second and that's a big concern. >> a little further north to france. we've heard about brexit. there's talk in the market with a frexit. brexit followed by trump's victory. the question is whether france there, the national party who has been campaigning for france to leave the eu and the euro zone, that's the big concern she. we are starting to see concerns of this leader gaining traction in the polls and her ability to win in the upcoming french election west saw a bit of movement in the bond market. >> not to be left out.

the banks have been trouble for a long time bust debt is the key issue. >> it is glrhigh debt and dysfunctional issues. we can see it get through. that means you're seeing a lot of stress being put on the banking system with noenld in sight. >> thank you, i think. we appreciate it. coming up, which stocks records can be found in the small cap?

here's a look at what to watch for. on monday president trump meets with canadian prime minister justin trudeau. on tuesday, fed chair janet yellen faces the republican congress for the first time as she testifies on the economy. it is the first of two days of testimony on. wednesday, dow component cisco is scheduled to release earnings. that's what to watch for next week. time for our market monitor. the stroks poised to see above average earnings growth. the last time he was on about two years ago, the stocks were both up and down double digits. >> nice to have you here. >> thanks for having me. >> do you expect get returns. some of that is based on what the trump administration has promised which is regulatory reform. >> we're just paying attention to what's going on out there.

within the home rconditions. you can see areas that are being overlooked or somewhat misunderstood. where we can find growth in those areas and the market hasn't fully priced them in. that's where we're finding the greatest opportunities. >> let's start with the first pick. tower semiconductor. it is small and independent. >> yeah. this is a small semiconductor specialty. so they're in a position the see significant operating leverage in their business as they ramp the volume. as you see improvement in the semiconductor industry in general. and they'll come out with earnings next week. we expect them to have a relatively good quarter. a relatively positive outlook for 2017. so that's a name that you don't hear a lot about.

but we think it is one that is under the radar and undervalued relative to the earnings expectations in the next few years. >> next on the list is kansas city southern. you may it is misunderstood. >> we like their business relative to the other railroads out there, right now they're trading at a discount to the group because of their exposure to mexico. and we think over time, the trade concerns with mexico will be resolved. and we think sometime in the next 12 to 18 months, you will see kansas city southern trade at or above the market multiple for the rail roads. >> and finally, eagle materials. cement and wall board manufacturer. >> both of these, they're not exactly exciting areas to invest in. but they're seeing good pricing

power. we think they're in the early stages of an earnings recovery in that business. they should do well as infrastructure spending rampls up. and we continue to like the name here. we think it is very much under the radar and underappreciated. >> you say there's a recent price increase in the price of cement and wall board. that works for them or against them? >> that's a positive. >> we would like to find companies who sell products that are exhibiting pricing power. when you're able to raise the price of your product, it allows to you expand your profit margins and see hire earnings and ultimately earnings drive stock prices. >> on that note, thank you for joining us. eric marshall with the small cap fund. that will do it for "nightly business report" the tonight. i'm sue herera. thanks for joining thus week. we'll see you coming up on monday. >> "nightly business report" has been fund in the part by --

>> all it takes is a spark. one idea to take flight. the courage to seek the unknown tox. to explore a different perspective. at nasdaq we connect the world, its ideas, its capital, its businesses, the people that drive global economy. the future isn't tomorrow. it's right now. all it takes is a spark. nasdaq.

>> this is "bbc world news america." funding of this presentation is made possible by the freeman foundation. newman's own foundation, giving all profits from newman's own to charity and pursuing the common good. kovler foundation, pursuing solutions for america's neglected needs. and aruba tourism authority. >> planning a vacation escape that is relaxing, inviting, and exciting is a lot easier than you think. you can find it here in aruba. families, couples, and friends can all find their escape on the island with warm, sunny days, cooling trade winds, and the