tv Nightly Business Report PBS March 29, 2017 5:00pm-5:31pm PDT
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this is "nightly business report with tyler mathieson and sue herrera. the blue chip, should investors look to the technology sector for the next generation of high quality must-own stock. breaking ground, more homes are needed but home builders don't have the workers to keep up with demand. medical puzzle with a string of recent alzheimer's, drug failers, are researchers focusing on the right thing? a look at the growing debate tonight. those stories and more tonight on "nightly business report" for wednesday, march 29th. >> good evening, everyone, welcome. there were two market forces at work today. one took place overseas, the other right here on wall street. and as a result, a tug of war ensued with the dow and the s&p
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500 making slight moves, but the nasdaq headed north for its fourth straight day of gains t. dow jones industrials lost 42 points. the nasdaq added 22 and the s&p 500 rose 2.5. so let's genover sin over seas, divorce proceedings officially got under way. now begins the messy proj progress of leaving the uk. steve sedgwick reports from west minster. ♪ >> reporter: the british referendum where the uk decided to leave the european union, the british finally sent their letter to the eu, to the president of the council saying we're enacting article 50 and that actually the divorce proceedings will start placements it's only five short prafts in article 50, but part of that is a two-year time line,
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a very tight time line for leaving the european union and hoping the british are at least getting a trade deal as welt. >> that is already a thorny issue the eu chief negotiator said we need to sort out the uk's divorce bill, which he estimates is somewhere in the region of 60 billion euros before we can talk about a new trade deal for the united kingdom, mrs. may wanted the divorce bill to move at the same place and the terms of separation, moving with the trade deal as a part of a final team. whether they can do this in a type two period which also will be punctuated by german and french elections remains to be seen. but the eu council president put it today, he says there is nothing to win from anyone but the uk and the eu in this process. he says, in essence, this is all ability damage control and he said we miss you already, united kingdom. this is steve sedgwick for "nightly business report" in westminster. the other big force at work
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today is a stockmarket phenom' practically every year, it doesn't last long. some sectors make notable moves. >> reporter: history tells us investors might want to brace for a seasonal this ahead. it's a well known phenomenal, april usually gins with a flat and slightly down market for the first two weeks. the usual explanation is that investors withdraw money to pay taxes t. good news is that the market tend to rebounds immediately in the two weeks after tax day, which falls on aprilth with several sectors showing notable gains. analysis shows since 2000 the s&p 500 has been down an average in the first go weeks of april, up only 41% of the time. who weeks after tax day the s&p is up on average rising 75% of the time. that's significant for a two-week period a. few sectors are worth noting in particular, technology, financial, industrials, energy, all tends to trade flat to down leading up to tax day and jump about 2% in
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the two weeks after tax day. oddly, this trade doesn't work with largely sectors like health care and consumer staples. what is going on? besides the tax factor, earning season begins around april 15th, banks and industrials are the first to report in the back half of april. so it's possible reactions earnings could also be a factor. for "nightly business report," at the new york stock exchange. >> with just a few trading days left in march the nasdaq is the only major index that's higher for the month. it's easily outpacing the dow and s&p 500 this year t. nasdaq has been held by well known names, amazon, apple and facebook, that are trading at all time highs. so should investors view big cap tech stocks like these and others and the bluest of the bluff chips. joining us is james wang, analyst with arch invest. welcome, thanks to have you here. >> nice to see you guys.
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>> do you agree those are the bluest in blue chip tech? >> they are absolutely the bluest in blue chip tech by the market they have and amazon is eating the world in terms of retail and cloud. they're the largest cloud provider by far. microsoft and google combined. and in terms of retail, they acquired a middle eastern retailer today. they are expanding the global foot print giving them a long growth path ahead. >> if i wanted to assemble a portfolio of gold tech stocks that go beyond these guys, what other names would be nit properly? >> okay. so that's the kind of question we ask ourselves all the time and nvidia is a name that obviously became famous last year. it was the top performance stock of the s&p 500. if you read any major newspaper or watch a business nightly event like this one, you will hear about artificial intelligence being used everywhere, finance, media, tech. and really nvidia is a company and they make the processors
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behind all of the companies who need to build artificial intelligence solutions. their chips run ai ten times faster than existing chips. they have essentially a monopoly in this space. nvidia is a team that will do well in 2017. another one to contrast with that is ibm. ibm is not even's favorite stock. most analysts are shy ibm. we had a vigorous debate of ibm within our firm. our conclusion is i think people are a little too pessimistic in not giving us credit. everyone is talking about ai. but ibm has the secret sauce for ai, with i is data. they spent about $4 billion and acquired a number of companies that have the richest health care data in the world. we think once they tap into that, they will go into popular businesses. >> you also like facebook, which is a social media stock as well as a tech stock in many ways, correct? >> that's right t. story with facebook right now is the contrast story with snapchat.
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snapchat has an exciting ipo. a lot of millennials got into it parking their cash without doing anything productive. what's happened with facebook is that it's taken the best feature of snapchat which is quote stories. these are full screen, vertical videos that play back-to-back on your phone, very popular with teens. and they have put that feature into every single app owned by facebook. they started with instagram. this week, they add thad feature into facebook proper with the big blue app. >> that will now show these great very fun full screen videos and with facial filters like mignon characters for upcoming movie. this will give them long-term revenue growth beyond their current advertising lows. >> thank you so much for joining, james, we appreciate it. >> you are welcome. >> the federal reserve wants the central bank to get a lot more aggressive. eric rosenblum believes four rate hikes this year would be
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appropriate and wouldike to see an increase at roughly every meeting unless economic data come in much stronger or weaker than forecast. the fed already increased interest rates at its meeting earlier this month. officials at that time said two more hikes would likely be the right recipe this year. >> the supreme court is ordering a lower court to take another look at a new york law that prohibits businesses from imposing fees on credit card purchases t. fees in question are the ones that merchants pay to credit card issueers each time a customer purchases or swipe fees. the issue before the judges is whether the measure violates merchant free speech rights and a new york court says the law regulated conduct, not speech. the justices said the deals were speech and that it should be reevaluated. the warmest february in decades may have been just what home buyers needed to get out and sign a deal, a monthly index of pending home sales, that signed contracts to buy existing
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homes jumps 5-and-a-half percent to the second highest level of the year. home sales could be stronger if there were simply for homes available to buy. home builders have been very slow to recover from the recession and now they're being hit by new challenges the. we report tonight from denver. >> at a sprawling home construction site, just 15 minutes from downtown denver, workers are moving ground and framing walls and windows, but the work is slow because the work force is slim. in there the big challenge right now is getting the houses built. >> reporter: veteran home builder gene meyers weathered more than one recession, he's never seen a labor shortage like this, faced by the threat of president trump's new immigration policies. >> let's be honest, the backbone of the industry in denver is hispanic labor. >> because americans won't do
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the work? >> exactly right. >> reporter: meyers verifies documentation on his contractors but has little control over subcontractors who do the basic work. >> you don't always know who is building the houses? >> we do our best. but we don't always know. >> reporter: so you could have undocumented workers on the site here? >> that's possible. >> reporter: meyers has been working with an exka saitor for ten years, juan says he's been a citizen since 1999 but he still worries he could be deported back to mexico. >> i don't know what to think anymore, you know, with all these laws changing, you know. >> reporter: juan says some of his construction friends are already moving back to mexico. the competition for labor is so fierce that builders are outbidding each other, in fact, wage growth in residential construction is twice what it is for the rest of the work force. and some builders are actually driving by site, holding up spray-painted piece of plywood offering more cash. >> do you see poaching?
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there are sixes where you can recruit a worker, they work for you a quarter or two, then they're working with another subcontract contractor down the road. >> reporter: meyers says he could be putting up 50% more homes on this site if he had the hands to do it. as it is, it's taking two months longer to build the average home today. >> and time is money. >> reporter: meaning builders have to raise prices and pass the labor burden on to today's buyers. for "nightly business report" i'm diana olick in denver. >> head to our website for more about housing. nbr.com. what investors need to keep in mind as stock ticking and financial advising becomes more automated.
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>> new promise for treat, cystic fibrosis, veritech pharmaceuticals reported clinical data, it shows the 2r50e789 improves the patient's lung function. the ceo says the findings are strong enough to file an application for approval with the fda and shares took off, soaring 20% or tlabts in trading today. the fda approved the first drug to treat severe multipleler is roves and paid patients with relapsing ms. the drug appeared to halt progression of the disease with few serious side effects and patients with the more severe form the drug modestly slowed patient's decline. it will be sold by genetech sond sold by loesch. >> conquering alzheimer's the disease ask a pusle the medical community is trying hard to solve. after a couple high profile drug
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failures, the debate over protecting how to tackle the disease is intensifying. meg terrell has the first part of our medical series on alzheimer's. >> reporter: the track record for developing a new medicine isn't great, only about one in ten experimental drugs ever makes it to market. in alzheimers disease that number is one in 244. >> we have nothing to slow it down right now. >> reporter: the disease already takes a massive toll on public health. more than 5 million americans are thought to have alzheimer's today and that number is expected to triple by 2050 without new interventions that flow or stop its course. >> already, one in $5 in medicare and medicaid goes to alzheimer's. as the baby boom heads towards this stage, it will go to one in three and one in $2 and alzheimer's will single handedly collapse the health care system. >> reporter: despite the urgency, science still doesn't know how to stop alzheimer's
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from ravageing memories and min minds. in the brain amyloids hijacks the brain. in one clinical trial after another has failed to effect the disease. >> efforts have been made to affect people no remove amyloids. many have improved patient's cognition, lifestyle. the idea has been tested and shown to be incorrect. >> reporter: there are disagreements in medicine t. university of texas, snoept is in the minority. believers by harvard doctors are convenned by genetic data linkening amyloids to alzheimer's. >> i think scientists are reading the leicester carefully, paying attention to all the details for the last 30 years while the journey of the
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hypothesis would have to come to only one conclusion. and that is that the trial has failed the hypothesis. >> reporter: trial failures that most recently included one from merck in february and eli lilly in november. litt lily spent more than $2 million in two decades, many believe those failures may have been due to timing. >> what we've realized in alzheimer's disease is that the disease process itself in the brain begins you know somewhere between ten and 20 years actually before. if you wait too late. if you are treating patients who are already severely impaired, cognitively, it's probably too late to be treating them with the kinds of treatments we are now using. >> reporter: ongoing work from biogen, merck and others is still targeting amyloid. earlier in the disease. they are investing $2 billion to
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question whether targeting amyloids in this time and way will work. it's a question society is waiting impatiently to have answers. for "nightly business report," i'm meg terrell. >> tomorrow the new approaches the medical community is taking to combat alzheimer's. the food and drug administration says no to generic asth ma drug. that's wherewithal egin the focus t. pharmaceutical company says the fda rejected its application for the treatment, which is a jenneric version of glaxo smith kline drug. they didn't say what it was turned down. the company is reviewing the response. myelin slayers ahares are down. lululemon beat analysts expectation, but the company's outlook for the country. quarter was bleak. it set a slow start to 2017 would cause earnings and revenue to fall short of stills t.
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shares initially plunged more than 15% after hours, wiping out a 4% gain during the regular session where they closed at 6030. the chinese conglomerate cefc china is taking the nearly 20% stake in financial services firm colin group for $100 million. cefc's new position givers it the right to appoint three directors to colin 's board callen shares rose. sales rose more than expected thanks, in part to strengthen the company's specialty garment segment. profit came in ahead and universe is up more than 3.5% finishing the day at $141 on the button. bass's pro shops billion offer for rival cabella's may have got an life line. as a part of the original deal the credit card issueer capital one was supposed to acquire
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cabella's banking operationings, but capital one said it wouldn't be able to get regulatory approval before the dead line. now synovis financial may be achoiring that business. on the news, cabella's popped to $52.04. the world's large effort asset manager is overhauling its business, at the heart of the change, robots. life lock will increase machines when deciding what shares to buy and sell. as a result the firm will offer its retail customers lower cost funds that rely on computers to make decisions t. move comes as investors move more of their money into passive investments, like index funds, from those actively managed funds t. changes will result in job losses. they have roughly $5 trillion under management. financial services industry, including black rock becomes more automated, there are some things investors need to keep in mind, especially within it comes to what are known as
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robo-adviser options. here to discuss that with us is ariel o'shea, she's a nerd wallet investing. you are no nerd, glad to have you with us. >> thank you. >> for those who may not be familiar. when we talk about ro ba advisers what are they? what do they do? and do they work with me the consumer? >> sure. robo-advisers are really computers that manage your investments for you. some of them are strictly computer face so you will only be working with the computer. some of them also pair that computer with a human adviser so you get document support along with computeral go rhythms managing the investments directly. >> so what do you look for or how do you determine if a firm that has a robo-advisory arm is right for you? and how do you evaluate it? >> sure. so, you know, these firms vary wide 4ri679. so you know you want to look at
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the factors to you, if you don't sister a lot of money to invest, you want to look at a firm with a low minimum investor requirement. so some of these firms require zero money to get in the door. sometimes $500. sometimes as much as $50,000 or $100,000. obviously, you want to rule the looi higher balance firms off few don't have that money. other things are the management fees. robo-advisers are going to be less expensive than human advisers. but the fees can vary widely. so if costs are important to you. and they should b. you should always look at those management fees. i think customer service is really important alongside the investment portfolios that the adviser offers. so they tell you the pretty -- they can be pretty comparable among firms, you do want to make sure the firm is offering the investments you want. you generally can't customize the portfolio. they have several based on your risk tolerance, that will be the choices that you have.
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>> you all have looked at several of the offerings in this particular marketplace and have identified five or so that you think are a cut above. which ones? >> yes. so we looked at a lot of different level advisers. the two we picked are our best overall for most consumers are betterment and well spent those are independent advisers. we like them a lot. >> that i have low minimum, low fees, really innovative tools that are kind of constantly competing with each other. which means they are innovating quickly and providing management for consumers and really good support. we also like for someone who wants a human adviser element, we like vanguard personal adviser services. you can pay a little more. they also have a little higher balance requirement, but you will be able to have access to human financial advisers and so that's a benefit if you want to get someone on the phone. >> ariel, thank you so much for being with us.
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we appreciate your help tonight. >> sure, thanks, for having me. >> you bet. ariel o'shae is with personal website nerd wallet. ahead, greener pastures the spread of digital revolution into america's heartland. westinghouse electric filed for bankruptcy. the company once at the forefront of nuclear energy developments a seen some big losses stemming from projects in the southeastern part of the country. it was also the cost overruns and tumbling prices for natural gas, which roded nuclear energy.
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they will allow westinghouse to assess whether it should continue construction of the first new u.s. nuclear power plant in three decades. westinghouse is owned by japan's toshiba. buzzfeed will reportedly go public next 84. it's first reported by the online site axios. they have raised hundreds of millions of ven schur capital from firms like unbc universe am. the talks are in the early stages and, of course, nbc universal is the parent company of cnbc, which produces this program. >> robot, drones and artificial intelligence are pretty common, of course, in silicon valley. now investors want to use those technologies to transform traditional farms. dee dee roy is in burrelling game california awe at the tech summit where tech and agriculture are all coming towing. [ music playing ] . >> reporter: it's a bit odd to
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see dairy cows on farms wearing what looks like brightly colored necklaces. they're actually smart collars. their makers say they can save farmers hundreds or thousands of dollars per cow by testing for diseases before they become life-threatening or monitoring ovulation cycles. two different companies have come out with their own bovine devices, both startups call themselves fix-its for cows. livestock is one area of agriculture being disrupted by tech. the manager director of monsanto growth ven dhurs. >> we see more and more dollars coming into agriculture. it's banking ent tremendouspreneurs. >> reporter: by companies started their arm to tap into the birth of innovation. they raised a record amount last year and this year could top
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that, according to insights. some of the hottest companies include drones which make software for drones to map out fields more precisely and then there's blue river technology. the company uses cameras and computers to make lettuce box to harvest the crop. industry watchers say start-up can bring innovation solution faster. >> they will be nimble, fast. they've will change faster and they won't be sitting in meetings. it's exciting to work with their enprepreneurs. they don't have to have the whole answer before they get going. >> reporter: farmer's business network is part digitalco-op for farmers to help with best prices for feed or fertilizers. enp business network dealt with that challenge and putting resources close to farmers. physically and vir schully. >> we go and find the most innovative farmers. we will hire our own sales force
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to use online marketing. we use our virtual store, online store, to be able to attract farmer's interest and engage with them. >> reporter: experts say part of the reason why we are seeing such an explosion of tech in agriculture is that the cost of technology are much slower, especially with innovations like cloud computing, providing a backbone for many of these startups. for "nightly business report. >> that is nightly business report" thanks for being with us, i'm sue herrera. >> i'm tyler mathieson, have a great evening, everybody, see you back here tomorrow. [ music playing ]
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tim: this is "bbc world news america." reporting from washington, i am -- >> 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,
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