this is "nightly business " with tyler mathisen and sue herera. >> wreaking havoc. harvey has dumped trillions of gallons of water on texas creating catastrophic and historic flooding with more on refineries are closed. ports are closed. and the nation's fourth largest city is essentially under water. the human and economic impact of this monster storm tonight on "nightly business report" for monday august 28th. good evening, everyone, and welcome. tyler mathisen has this week off. we begin tonight with the devastation hitting southeast texas. where harvey made land over the weekend as a category 4 hurricane and then stalled dumping torrential rain which could top 4 feet in some areas when all is said and done.

there has been and will be historic flooding. there have been mass evacuations and several deaths. tens of thousands are without power in houston. the nation's fourth largest city, well, it's at a standstill. and the heart of the nation's energy infrastructure is impacted. we have reports up and down the gulf coast. in corpus christi near where harvey made landfall, galveston, of course, but we begin with contessa brewer in houston. >> reporter: houston is dealing with persistent flooding and relentless rain now measured in feet rather than mere inches. all the while officials are grappling with families still begging with the need to be rescued. on boats, by helicopter, even being carried. thousands of people were rescued from rising waters. >> 5:00 in morning we started to get water inside the house. it kept creeping up and finally there was about 3 feet. >> reporter: jacob and meagan joseph watched water intrude on

their beautiful home and overtake their cars. >> got us to the midway point, this church in bel-air, then had hpd bring us in a high volume, high-water vehicle to bring us here. >> reporter: at the convention center they found shelter and a place to sit. by day's end, they were joined by thousands more. babies and the elderly. the disabled and small students missing out on the first day of school. >> it was damage in the flood so we had to walk through water. they took us to the library. so, and we took a bus. so that's how we ended up here. >> reporter: as they join other families made homeless by the storm, fema announced it expects half a million texans to apply for federal disaster aid because of harvey damage and the federal government is preparing its financial response. >> my focus here is on the tragedy that's unfolding.

people whose lives are in jeopardy. and the people who need help. i have been spending day and night working trying to coordinate with local officials, county judges, mayors, speaking with the governor. repeatedly speaking with the president, the vice president, cabinet agencies trying to marshal federal assets to save lives. >> reporter: in houston, airports remain closed until thursday. downtown, business after business is closed. and streets are impassable. locals are putting off thinking about the financial toll. >> we're shut down for today don't know how long we'll be shut down this week. primar it's because of the impact on our colleagues and employees. >> reporter: 3 million workers have jobs in the metro houston area. jacob and meagan joseph are eager to return to work. he is a physician at a local hospital. she, a speech pathologist. for now, they're simply fwrat l f grateful to be the army corps of engineers is releasing water from two nearby dams, knowing they're going to flood neighborhoods more in downtown houston but preferring

that as the option rather than risking a breach from reservoirs that are at capacity. in houston, texas, for "nightly busine i'm contessa brewer. >> as we mentioned earlier, houston is the nation's fourth largest city and the region is a huge contributor to the nation's energy output. brian sullivan is in fwn with more on harvey's potential hit to the oil market and houston's impact to the economy. >> reporter: along with the unprecedented flooding and humanitarian crisis unfolding in houston and lower texas region, there may be an economic crisis as well because 15% of the oil and gas that is refined in the united states is currently offline. shut down by the flooding as a result of hurrican. the houston area produces more than 2 million barrels of oil and distilled gasoline every single day. many of the refineries around here are now shut down including the second biggest refineryn th utestesheaywn facility from exxonmobil, also

shell's deer park facility is also shut down. there's no clear word of when those facilities will open. the other hit comes from the port economy. the majority of those refineries lie along the port of houston, which is actually a series of four different ports and every ship that comes or goes has to come through a channel right over there. and that ship channel, the busiest in the united states, is currently shut down and there's no indication of when it opens. in addition, many of the men and women who had worked at the refineries, the pipes, the shipping facilities, the offload facilities and the ports, simply cannot or will not get to work because they are facing a much more serious issue. the city of houston does more than $500 billion per year in gross domestic product, make it one of the top 25 nations in terms of economic output. it is the fourth biggest economy in the united states and while the city grapples with a humanitarian crisis, and the rescue of many of its citizens, there's also the future issue of gasoline, oil and shipping which

is shut down and is so vital to this area and to the united states. for "nightly business report," i'm brian sullivan in galveston, texas. >> it's not just houston and galveston. harvey came ashore first near corpus chr where more of the nation's refineries are located and that's where we find jackie dean >> reporter: the eye of hurricane harvey hit the coastal towns of and around corpus christi hard in nearby rockport, businesses and homes destroyed. >> i lost ev. i have nothing. and i'm trying to be positive and make this a fresh start. >> reporter: rick miller, a rockport resident, is disabled and was unable to evacuate the area ahead of the storm. the roof was ripped off his home and its interior decimated. luckily his neighbors took him in before impact. bill, rick's neighbor, describes the experience. >> devastating is the first

word, obviously. howling wind was pretty crazy. we were getting through it. the next morning was heartbreaking. when you see destruction like this and your community and your lives, it's hard, but we're alive. >> reporter: the mayor of rockport advised those who evacuated to not immediately return because rebuilding the infrastructure and restoring power could take weeks. governor abbott and senator cornyn also toured the area today to survey the damage. governor abbott deployed the entire texas national guard in response to the disaster. 12,000 people to help the rescue and relief effort. >> we're going to be dealing with really record-setting flooding in multimillion res across the state of texas. >> reporter: meanwhile, another area of focus, the refineries on the gulf coast, a little less than 50% of what the u.s. can churn out and it looks like as of now, projections indicate

that 2 million barrels a day have come offline. that means that prices most likely at the pump are likely to rise as well. for "nightly business re i'm jackie deangelis, corpus christi, texas. >> with the severe flooding along parts of the gulf coast, the price for u.s. gasoline futures jumped to a more than two-year high today while domestic crew fell nearly 3% as the market tried to assess the storm's impact. john joins us now to tell us what this all means for gas prices. founder partner of again capital. good to see you, john. thanks for joining us on set tonight. >> sure. >> really an unprecedented situation. as we were just talking, this storm is moving so slowly. they're in for more rain. how is the market for energy trying to price this i >> the market for energy, i think, is really struggling with what we're dealing with here. we're used to big storms coming and trying to hit the heart of the refining sector.

we but them all there for whatever reason. they're vulnerable to this sort of thinge built to withstand it. high winds, some rain, but flooding of this mag volumes of water of this magnitude, could make it nearly impossible for days, if not longer, weeks, for the folks that turn the dials and flip the switches to get back to these refineries that you saw brian and jackie talking about. >> yeah. >> this could take some time, plus they have their hands full with their personal lives so we're not seeing the rush, nor should we, for these people, this staff, to get back to the units. that's what's going to hold back production of gasoline and diesel fuel over the next several weeks and drive those prices higher. >> because it is a multiple-day event, the governor is saying please don't come back. >> exactly. >> so that, i think, it was one of the factors i heard a lot about in the energy market, it's almost impossible to handicap when those refineries are going to come back online and it's not that easy to bring a refinery

back online, is it? >> no. this is what was called a sudden -- this is going to be what they call a cold restart. so, they were able, fortunately, to be able to shut them all day in an orderly fashion, but getting them back takes the full team. all hands on deck. because there's obviously so many combustible parts in the refinery because you're running crude oil up a big stack, literally, and then pulling off, like you do with milk, the cream, the heavy milk, and the skim. and you need everyone there for that and you're not going to have -- be able to get that staff back soon. >> we are seeing some spikes in gasoline prices, most notably along the areas surrounding texas. perhaps that's not so much of a surprise, but do you expect that sort of ripple effect of higher prices to be seen across the country? >> i do. i think initially here, as we're seeing, it's been a very moderately paced rise. the futures market and the wholesale markets have priced in what looks to be a looming tightness. i do think that prices

ultimately could get as high as $1 over what they were just last week. and i also think that in the southeast, we will see spot shortages because that's the region that's most reliant on the refineries you've been talking about this evening on the program. in the upper midwest, they have their own refineries. east coast, we have our own refineries and can get product from europe. california suffers on their own all the time, anyway, so they're out of the picture. we're really talking about the southeast here. >> very quickly, late in the day this afternoon, nhk, the japanese broadcaster, reported and japanese sources confirmed that the north koreans had fired a projectile. there were some reports that it was a missile. other reports disputed that. what might that do, quickly, to the energy market? >> it is an extraordinarily bearish event for energy prices because it's going to strike at the heart, if there's any kind of hostilities or even higher anxieties, at the economic virtue of the asian region,

seoul, tokyo, beijing, they're all in play on this if there's any kind of -- if hosties tsh this is why the equity market buckled a couple weeks ago as well. >> john, thank you very much,s as well, with again capital. late today prege rapid goveg .o texas and those hit by >> you're going to get your funding. it's a terrible tragedy. we expect to have requests on our desks fairly soon and we think that congress will feel very much the way i fe. in a very bipartisan way. that will be nice, but we think you're going to have what you need and it's going to go fast. >> and corporate america is sending its help as well. thus far, more than a dozen major companies offered assistance to harvey's victims. see them on th. some of note, $1 million from walmart, pepsi, chenier energy, home depot, amazon, wells fargo, and $2 million from apple.

the houston texans pledging $1 million. , united airlines which has a hub in houston says it will issue travel waivers for anyone impacted by the storm to 15 area airports. the waiver will be for any flights impacted between august 25th and september 5th. for a complete list of airports the waiver covers, go to our website at nbr.com. energy stocks weighed on the market today and insurer travelers was one of the big ef losers as investors took a step back to evaluate the impact and as i mentioned after the bell, the market could react to this tomorrow as we mentioned with john, there was a japanese news agenc that north korea launched a missile that passed over japan. as for today, the dow lost five points to 28,808. the nasdaq rose 17. the s&p 500 managed to add a assessing the s c damage. >> reporter: >> reporter: i'm morgan brennan

in windsor, connecticut. take a look weather analytics, social media fees. big data. some of the tools that insurers like travelers are using to begin assessing damage from hurricane harvey. before adjusters are even on the ground. that story is coming up in "nightly business report." we're starting to see harvey's exposure for mortgage giants fannie mae and freddie mac. fanmy they says there were more than 46,000 fans whose mortgages in the initial impact area with about $5 billion of unpaid balances. meanwhile, freddie mac estimates it has 167,000 mortgages in the 18 counties affected so far but says that number could grow. insurance stocks were hit today as investo wait on the

initial estimates of damage from harvey but the insurers aren't sitting idly by. they are using state of the art technology to get a head start on assessing the damage. mo takes us to travelers catastrophe center in windsor, connecticut. >> reporter: as harvey continues to linger over the texas coast, insurers are using technology to model the damage. as they wait out the storm to send resources into the e. travelers has been monitoring harvey from its national catastrophe center using monitors displaying weather analytics, big data, even social media feeds. this center and much of the technology in it is relatively new. it didn't exist for hurricane katrina in 2005 or hurricane ike in 2008. but now it's become crucial to the claims process at travelers. >> many of the new tools have really expedited the claim process. for instance, we can actually bill out the footprint of a

property before we're on site to inspect it. >> reporter: as more claims come in, this center will get busier. three mobile claims vehicles y to the coast. many of the adjusters heading there will use drones to make their assessments. travelers is one of the biggest underwriters of commercial and residential insurance in the region. others, allstate, state farm, are also sending resources to the region. farmers insurance is deploying a small portable city for its adjusters. many of whom who also will the first time after a hurricane use drones. >> our drones can map the damages for about three houses an hour. prior to this, it would take an adjustor, we could do three houses in a day. >> reporter: harvey made landfall as a category 4 hurricane, it has largely become a flooding event. with several feet of water submerging parts of houston and the coast. the federal government accounts for nearly all of the residential flood insurance market, but homeowners insurance does cover wind. the private sector also covers flooding for many commercial properties. from strip malls to refineries

to hospitals as well as automobiles. >> lot of cars are trapped under ground. so if we're wrong abe 2 to 4 on the private insured loss, it's going to be because the auto losses are goine a lot more. >> reporter: harvey is expected to be one of the costliest storms in u.s. history with losses to expected to reach tens of billions of dollars. with more than $700 billion in surplus, the industry is well prepared to weather the storm. for "nightly business report," aisle morgan brennan in winds door, contract are contract. >> southeast texas is pounded by unprecedented floodwaters, national flood insurance program is set to expire on september 30th unless congress can reach a deal. we're joined from washington with more. does the program he enough money as it stands now to take care of th in texas? >> reporter: right now it looks like it may not. the program is already running in the red, about $25 billion in debt, and that reflects claims

going all the way back to even hurricane katrina. the program maxes out at about $30 billion, so it's only got about $5 billion to $6 billion of wiggle room there and likely the claims from hurricane harvey will surpass that amount. >> so what can congress do about it? >> reporter: well, president trump was just speaking today saying that the victims of hurricane ha will receive the full support and cooperation of the federal government, but there's been a lot of debate in washington over whether extending the program should be accompanied by any spending reforms in the future. so, we'll have to see whether or not there is a bipartisan spirit that will emerge when lawmakers come back to washington after recess is over. >> thank you so much. gilead sciences bets big on a potential breakthrough cancer treatment. that's where we begin tonight's "market focus." gilead said it was buying biotech kite pharma for nearly $12 billion. as the drug maker makes a deeper

push into the oncology field. kite pharma which does not have any fda approved therapies is working on a promising treatment that modifies the body's immune system to fight cancer cells. gilead's shares were up 1% to 74.69. shares of kite pharma rocketed higher by 28% to 178.05. apple will reportedly unveil its newest iphone september 12th. according to multiple reports, the event is slated to include software updates and new apple tv and apple l watch. apple shares rose to 161.47. speaking of the apple l watch fitbit unveiled a new line of products including a smartwatch. the device called the fitbit iconic -- ionic, rather, will retail for $300 starting in october. the watch is water resistant, includes gps tracking and can run thd-party apps. fitbit shares were higher by 3%.

estee lauder denied reports it's interested in selling itself. over the weekend, the cosmetics company wrote a memo to its employees saying there's no truth to the rumors and the company places great value in remaining independent. estee lauder shares fely to 105 it looks like the high-profile search for uber's next chief executive officer is at an end. the embattled ride hailing company picked expedia's ceo to head the company. while expedia's chairman barry diller says nothing has been finalized, he acknowledged the offer will likely be accepted. we take a look at the man asked to take the wheel at uber. >> reporter: months of drama, a corporate culture crisis, executive departures and board infighting, uber will turn a new page having finally selected a new ceo. expedia's ceo was selected at the end of a dramatic weekend that saw former ge boss drop out of the race via a tweet.

and hpe chief, meg whitman, reentered the running despite publicly denying she was interested in the role. seen by early uber investors as a very qualified and respected choice. >> i love it. i think he's great. we've been following his career for a while. we're super bullish. >> everything i heard abe t work he's done at expedia, seems like a very good choice for the company. presided over expedia's expansion to more than 60 countries and made deals to bring in other brands like travelosity and orbitz and homeaway into expedia's fold. he has his work cut out. if and how much he'll work and talk to former ceo is a big question. and alphabet's wamos over technology. plenty of positions to be filled. boosting morale and fixing culture at a company that's just gone through the wringer. >> i think all the distractions associated with the company have

been unfortunate. seems to me from what i've read and what i've seen from other people covering this, he's the type of person that's going to come in and institute a culture that's going to kind of ta some of those distractions and probably put them on a more professional business path. >> reporter: and perhaps put uber on the path to profitability and eventual ipo. despite the drama this year, uber has continued to grow while cutting losses but investor confidence is another matter. four mutual funds including vanguard have lowered the valuation of their uber investments and smaller rival, lyft, making inroads raising money and expanding to more of uber's territory. cleaning up the mess, keeping the $70 billion company humming, is no small task for uber's incoming ceo. for "nightly business report," san fran whole foods slashes prices, but will other grocers feel the pressur

here's a look at what to watch for tomorrow. we will get a look at how home prices are doing with the release of the s&p case-shiller index for june. then a read on how the consumer is feeling when this month's confidence numbers come out. and corporate earnings are still trickling out. tomorrow we get quarterly results from big box retailer best buy. and that's what to watch for on and finally tonight, now that the $13 billion merger between amazon and whole foods is complete, the grocery chain has begun slashing prices. in fact, on day one, whole foods cut prices on some items as much as 43%. and now that amazon is the owner, many are watching the possible pricing impact on the industry overall. courtney reagan has more.

>> reporter: it's the first day that amazon owns whole foods and shoppers are already finding lower prices on some bestselling items including organic bananas for 69 cents a pound instead of 99 cents. organic brown eggs now $3.99. 30 cents lower. 85% lean ground beef will cost $4.99. before today it was $1.50 more. most shoppers told us their biggest hesitation of whole foods are the prices but now they'll reconsider. >> now i'm going to be shopping a lot more there. 43% drop. came up on my phone this morning. >> going to be dropping their prices. i'm onboard with that, absolutely. >> i would absolutely go back to, you know, to going to whole foods if the meat was dropped. if the prices were dropped. >> reporter: advisory group analyst joe feldman says based on his analysis, prices are about 25% less on the 30 or 40 so items with new lower prices. >> that's still a little bit higher than, say, a walmart or kroger might be but it is much more within the range.

i mean, previously, whole foods had been 35%, 40% more expensive than conventional grocery. now we're talking maybe 5% to 20%, 15% to 20% difference. >> reporter: don't expect to see other supermarkets lower prices further in response. grocer retailerses like kroger set prices with food suppliers like general mills oy twice a year, possibly losing shoppers like those we smoke to in the meantime. whole foods has only a fraction of the stores compared to those of walmart and kroger nationally. walmart, biggest grocer, has ten times as many locations as whole foods. whole foods requires its food passes strict organic, no gmo and other standards so it's not for everyone. >> the can you believe that? they don't have the conventional stuff that guys like me get. >> reporter: still, stock prices of food makers like kraft and grocery stores like supervalue

have gotten hit from each new development out of the whole foods/amazon deal because of all the unknowns. when amazon comes into an industry, it changes everything. for "nightly business i'm courtney reagan. and that is "nightly for t. i'm sue herera. thanks for joining us. we'll see you here tomor

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