. this is "nightly business report." with tyler mathisen and sue herera. funded in part by -- >> 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, 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. >> economic vision. will president trump deliver specifics on his pro business policies? it is what wall street is waiting for. >> target's troubles were tough

last year. this year could be tougher. now it is doing something risky to win back customers. >> the discount bin. shopping online just got cheaper and mom and pop investors are clearly the winners. this is tuesday, february 28th. good evening. welcome. i'm sue herera. >> i'm bill griffin in for tyler mathisen once again. it is over. the dow's run of 12 straight record closes has ended. there will be no number 13. today a feeling of caution permeated throughout the market ahead of the first major address of the president this evening. investors are holding back, waiting to see if he offers policy details. by the close the dow lost 25 points. the nasdaq fell by 36. the s&p was down 6. for the month, the three major averages posted gains of about 3% to 4%. >> the big event for investors

come tonight. his speech intended to outline his vision for the country. for investors, that means how he intends to boost the economy and business. what are some of the big themes the president will likely touch on tonight? >> well, you mentioned the purpose of tonight is for the president to set the table for the agenda for his administration and its congressional counter parts which will be tasked with turning much of his agenda into law. or putting it on paper. here the broad strokes that we're expecting to hear. first expect heavy focus on the economy, the trade deficit. companies bringing jobs back to the united states and incentives for companies that may have yet to do so. then the conversation will turn toward national security in a white house until said expect immigration to figure prominently in that part of the speech. unclear how much detail the pleasant give about forthcoming

policy on immigration with the "wall street journal" reporting at this hour that potentially a new executive order on immigration could except current visa holders. we will see whether the president goes that far. an official tells me they expect the speech to be optimistic, yet realistic. >> we all know the expectations are very high on wall street for these initiatives. what about the timing of the president to get them passed? >> beware the ides of march, as they say. there are multiple legislative priorities and deadlines coming up in the next few weeks. the administration has said, expect some tangible ideas on paper about tax reform and about a new replacement for the affordable care act in a matter of weeks. that comes as the white house has a march 16th deadline to turn in a budget blue print to congress and there could be some new skepticism about exactly where the president and the white house want to spend their money. >> a budget ro posal that will

meet the same fate as oklahoma's proposals. i think president obama's proposals got one vote. the bottom line is i appreciate continue crease in military spending. but you're undercutting the ability to win the war if you take it off the table. >> then there's skepticism on tax reform and whether that could take longer than originally expected. the congressman says it won't be a 30 or a 60-day matter but that this congress might take a full two years to get done. >> thank you so much from the white house this evening. >> back to the stock market. the dow has risen about 2,500 points since the election and investors do want to hear specifics from the president on his pro growth policies. what he says tonight could set the tone for trading tomorrow. bob takes a look at what investors want to hear and what the reaction might be.

>> traders are anxiously awaiting president trump's address to congress tonight. they want specifics on three issues. first, tax cuts. second, infrastructure spending, and the repeal of obamacare. along with what will replace it. most traders have come to believe the speech will be short on specifics and likely reiterate broad regulatory reform, immigration, trade reform and defense. . of the speech will be directed at a small group. congressional republicans. many of whom are deeply skeptical that much of the president's plan will result in more deficits and more debts. that may indeed happen. but the president has already argued that his great tax cuts, regulation and infrastructure spending will revv up the economy. how much will it revv it? about 2% a year for the last decade. but trump is arguing his

measures could get it back to 3% growth. that would be the long term average. so far, the trading community has given the president the benefit of the doubt. february is ending with a roughly 4% gain in the s&p 500. you know, that's a great showing considering that february is historically a down month. that brings the idea that the president will accomplish his goals, and that potential problems like a trade war will not materialize since traders start doubting the goals. they will react negatively. >> billionaire investor will better ross was sworn in. it was a day after mr. ross was confirmed by the senate. he has a big to do list. the commerce secretary is expected to start working on renegotiating trade relationships with both china and mexico. he will also likely play role in

cutting trade deficits. say that he will have a part to may in trying to bring manufacturing jobs back to the u.s. speaking of which, economic growth slowed in the last three months of 2016. the nation's gross domestic product, the broadest measure of the goods and services produced in the u.s. grew at a 1.9% rate. that was less than the previous report and slightly below expectations. business investment and government spending were revised downward in the fourth quarter. while consumer spending remains solid. >> and that's being reflected in the greatest confidence index which just hit a 15-year high. it gauges both consumers' assessment of current conditions and the expectations for the future. economists closely monitor the mood of the consumer because their spending accounts for nearly 70% of activity. consumers do not appear to

be shopping at target. they are coming off a week holiday season. and it said 2017 does not look much better. profits plunged in the most recent quarter and the company expects full-year profits as well. that sent it tumbling below 12%. now as courtney reagan reports, the company is planning to do something dramatic to get those shoppers back. >> target's holiday quarter missed the bull's-eye and the retailer doesn't expect a turn-around this year. in fact the opposite. the discounter is reversing course. expecting profits and sales to fall. target laid out its three-year strategy though it look like what it and other retailers have been doing. >> we think we have the right plan in place. >> brian cornell is that others detail the plan.

remodel 600 stores. build 100 more small format stores in more populated cities. take a though it margins. more than a year ago, walmart began investing in its online operations and lowering prices and it paid off. perhaps at target's expense. >> we remodeled 25 stores. over the next two years we'll take it to over 600 stores. as we reimagine these stores, we know how the guests react. it drives more traffic, brings our guests back more often, brings greater engagement. it will take time. >> target still leans heavily on its stores. target says both online and in store are still priorities. and while many are skeptical of the three-year plan, target's

ceo says he has support of the board. >> the board has been incredibly supportive. obviously we spent a lot of time with the board but universally they support the plan. they know it is the right thing for the company. the right thing for the brand and the right thing for the shareholders. >> shareholders fell differently today as the stock plunged in reaction. i'm courtney reagan in new york city. >> with target's turn-around plan looking like what others are doing, is this a race to the bottom for retail? some answer perhaps from joe feldman. good to see you, welcome back. >> thank you. >> the ceo says the rate plan is in place. but cutting prices is already being done for a number of competitors. is that the right strategy? >> i think they need to stay

competitive. for example, walmart announced yesterday that they would be reducing prices in 1,200 stores northwest. kroger's is reducing prices. there's a lot of pressure. others are leading this on the prices down. and target has to keep up and that's part of the pressure. >> mr. cornell pointed out the board is on board if you will with his three-year man. clearly wall street is not. stock down 12%. what do you think wall street wants to see target do? >> i think wall street wants to see proof in the pudding. they've had other strategies in place. some have worked. they've talked about signature categories. and they've done better there. but there was not much discussion of groceries today. during q and a, they talked about grossries a little bit but that's 35, 40% of the store. and there wasn't much answer there as to what's going.

on i think wall street wants to see and hear more proof that so many strategies will pay off. we need time to see that happen. as of today, peel don't want to give them that time. the visibility is still pretty limited. >> the company pointed out a 34% online sales growth metric, which they say validates their performance. or that model of their performance. but they're going up against the likes of an amazon. >> yeah. and their growth is very strong right now. and it is a smaller base. so they've been capturing a little more share. then you wonder, are they taking some share that they would have otherwise gotten in the store? they need to have both. as do most retailers. and they are closer to the consumer given the 1,800 stores or so. i feel like they're sort of sandwiched between amazon and walmart. they have a decent overlap with both. on the customer spectrum.

and that's created a lot of pressure for them. that's really where target sits right now. i think they're trying to find ways to differentiate them to find ways. >> we'll be following the story. thank you very much. >> target is not the only company cutting prices to lure consumers. so are discount brokers. fidelity now, the latest to lower its fees as competition increases. that shares shares of publicly traded sharply lower today. what is bad news for the business may be good news for the customers. domini dominick chu has more. >> it just got even more heated. what does that raging price war mean for everyday investors? >> when the average price comes down, i think the investor benefits, we don't believe there

will be any degradation of services at this point. so we think yeah. the winner here has been the retail investor. >> fidelity views it as a way to aggressively bring new customers to the company's ranks, attract clients of other brokerages and keep the one that it already has. in a statement, them, quote, with these unprecedented price cuts, fidelity is continuing to transform brokerage industry bringing the best value to retail clients. they playing hundreds each year will benefit from our dramatic price reduction and all clients who trade will be able to keep more money in their pockets. more money in the pockets of investors means better returns and more profits to retire on down the line. the brokerage industry will feel the pain. >> obviously, pricing commission cuts will negatively impact the

revenue and the earnings of the ebrokers. it depends on how much they have coming from commission and it varies among schwab, etrade, ameritrade. ameritrade having the most. >> the cost for investoring for everyday americans. over the past decade, plus, costs and fees for things like trading positions and fund management have been falling making investment easier for more people. for "nightly business report." still ahead, why the corporate nerve center of a global electronic powerhouse is in crisis management mode.

chances are you own a samsung product. it's a big company. maybe a tv or a tablet. the south korean conglomerate is now in a corruption scandal after a number of its executives including its billionaire heir were indicted. the report from singapore. >> the south korean special prosecutor formally indicted the head on charges of bribery and embezzlement. four other samsung executives have been indicted. the question is whether $38 million in samsung donations to charities were actually bribes for governmentback of a samsung merger. it was by president park

geun-hye's long time friend. prosecutors said they curried favor with the president. so how did the shares do? investors didn't seem phased as the crown jewel rose 1%. a battery company also gained. samsung confirmed the form he vice chairman and the president have both resigned. for "nightly business report." in singapore. >> valiant predicts a tough year ahead. the drug maker predicts 2017 will be a year of transition. the company expects revenue to fall as it continues to adjust to a business model. it also cited head winds and fewer predictions. shares plunged almost 14%. shares

shares, the report was based on class action arbitration filings. the jeweller responded by staying class action did not involve sexual harassment. only gender discrimination. claims regarding pay and promotion. shares fell 12%. the experimental cancer drug hit its main goal during a study. the drug use as new type of treatment to attack tumors. the company is optimistic it will win government approval. >> this data is actually six to seven times better than anything that has been described so far for these patients. this is not a 20% increase, a 40% increase. this is significant. so therefore, we believe it will hold, we will see an approval by the end of the year. >> the shares went to $70.77. 3d printer maker swung to a

profit in its latest quarter. that topped estimates. the revenue did rise but not at the clip they were expecting. as the professional printers and on demand services. shares were down today. and palo alto, the cyber security firm reported a wider than expected loss. the shares there initially fell in afterhours trading and it finished the regular session down 1%. the ceo of tenet health care said the changes in obama health care will help the hospital during an earnings conference call. they said the idea of repeal ask repair is a positive call for the company. they reported weak revenue and that may have caused the shares to slump. and it's not just investors

who will be paying close attention but also small business owners. the best changes coming to the affordable care act could impact the way they do their business. kate rogers has our story. >> reporter: mike's business in portland, oregon, doesn't have to offer benefits. the company at 15 is too small to be forced to comply with the employer mandate of the 2014 affordable care act. it requires firms with at least 50 or more full time employees to provide coverage or be hit with a fine. even though he didn't have to offer insurance, he realized the benefit of doing so. once it came into law, it had a bonus. >> it had an income tax benefit that was good for our employees. it was almost $5,000 in 2010. and it ramped up a little each

year. last year it was almost $8,000. we used that to basically pay down the actual cost of our employees' health insurance. >> while roach no longer qualifies for the credit, he decided to continue offering coverage, recognizing it is a competitive advantage for his business. in a marketplace stands to be impacted thank big way with president trump's promises to repeal and replace the affordable care act, many are wondering. he said he would like to return to the days of having the benefits for his nearly 200 workers. >> i would like to see the mandate dropped on there. before it was something that as a company, you have a choice. what do you want to offer your employees and the type of benefits and people have the choice as to where they want to work. >> some young entrepreneurs benefited from obamacare policies, including a provision allowing individuals to remain on their parents' man until age

26. enabling him to launch his sustainable start-up. >> i just turned 26. that was something that was very helpful for me. and we look at the business, being able to support our employees. >> no matter what side of the policy debate, main street will be maintained carefully and for any clues as to how they stand to be impacted by the trump administration's changes to the health care law. for nightly business report. coming up, hitting the gas. the cars that dominate list of best vehicles and the one big american brand that was left out.

here's a look at what to watch for tomorrow. more retailers report earnings including best buy, lowe's and dollar tree. the fed releases its beige book and automakers will release the sales numbers for february. that's what to watch for on wednesday. >> thinking of automakers, consumer reports rating the best ask worst vehicles, show foreign automakers continue to outpace domestic demands. just 2 out of the top ten. especially bad news for one of the big three. >> with americans buying cars and trucks at a record pace, almost every auto maker is cashing in. according to consumer reports which tests almost every new model, it asks subscribers to rate their open cars and trucks. some are doing a better job than

others. this year the top four brands are audi, porsche, bmw and lexus. with audi repeating as number one for a second straight year. >> some of the brands make unbelievable cars in terms of the way they perform. they drive very nice. they offer a lot of luxury quietness but also performance. >> where are the american autos? tesla has the highest rating at number eight. right ahead of buick at number ten. gm was also the only american automaker to have two models, the chevy cruise and impala, singled out by consumer report as the best of the best. on the other hand, jeep, i know what dodge and fiat, are cited as three of the worst auto brands. in part because consumer reports does not recommend a single fiat model. the automaker said we respect consumer reports' opinions, as they're one of three we've received comments frflt at the

same time we encourage customers to experience our vehicles for themselves. >> people want to be in a jeep. they do offer something a little nontangible. that people do enjoy. that's okay. but as time goes on and more and more people drive these products, and they have the reliability products and they don't drive very well. it will hurt them. >> but so far, jeep has not been hurt by consumer reports' criticism. in fact over the last several years, regime sales have far outpaced the rest of the industry. proof the brand and its suvs are still attracting americans. even as others give it a poor report card. "nightly business report," chicago. >> the highest rated u.s. automaker. tesla. unbelievable. >> that will do it for us on "nightly business report." thank you for joining us. >> have a great evening, everybody. see you tomorrow. >> "nightly business report" has

been funded in part by -- >> 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, its ideas, its capital, the businesses, the people that drive global economy. the future isn't tomorrow. it's right now. all it takes is a spark. nasdaq.

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