>> announcer: this "nightltly busine wit history on wall street. the dow tops 25,000 for the first time, marking the fastest 1,000-point sprin ever for the blue chip index. thriving rally. if you're wondering why the markets are soaring, look no further than the economy. and buzzkill. attorney gener cracks down on the marijuana industry, signaling big changes for that budding business. those stories and more tonight on "nightly business r for good evening, everyone, and welcome. there was no winter chill on wall street today. the stock market remains red-hot. the dow plowing through a new milestone, 25,000.

and it did so at a record pace. it is the latest show of strength that has taken that blue chip index up more than 25% over the past year. the economy is growing. the labor market is strengthening as evidenced by today's private payroll jobs report. corpore profits are rising. and it didn't g >> we broke a very, very big barrier, 25,000. and there were those who say we wouldn't break 25,000 by the end of the eighth year. we did in fact break 25,000, very substantially break it, very easily. so i g new number is 30,000. but what it means is every time you see that number go up on wall street, it means jobs, it means success, it means 401(k)'s that are flourishing. >> the dow jones industriae adv 25,075. the nasdaq added 12. the s&p 50 10. bob pisani takes a look at the first big milestone of 2018.

>> reporter: the dow hit 25,000. it hit 20,000 almost exactly a year ago. many are amazed that the market keeps enhancing. it's not incomprehensible. china has had gdp growth at 6.5%. the japanese market just closed at its 26-year high. businesses repor their strongest activity since 2011. the adp report has been better than expected. don't forget, tax cuts have added fuel to record earnings. instead of s&p earnings growth up 10% in 2018, analysts are talking about 15% earnings growth. what could kill the rally? historically the two biggest killers of bull markets have been recessions, and aggressive fed rate hikes. there's no recession on the horizon. if the economic data continues to surprise, the fed may get

more aggressive. but that's a story for later in the year. the bears argue the market is expensive. it true, but when you have an economic expansion like this, with a rise in earnings, the multiples can be higher than normal. the final bear argument, a terrorist at or a serious conflict with north korea ma ma concern, but the markets have learned not to price in these events unless they're imminent. for "nightly business r" bob pisani at the new york stocexchange. so which stocks played a major role in taking the dow to its new high? our dominic chu takes a look at that one. >> reporter: it took les a year for the dow to march from 20,000 to 25,000. let's take a look some of the names that really powered that big 5,000-point move, because we all know the dow jones indu is a price weighted index. the stocks with the highest share prices move the index the most. that being said, check out that move. 5,000 points in a little under a year. the biggest contributor to the dow during that span, boeing,

the aerospac 900 points to that 5,000-point rally. unitedhealth group, caterpillar, 3m, and home improvement retailer h if you add these up, you'll see that just about half of the dow's gains between 20,000 and 25,000 were just these five stocks alone. it's not all positive. some of the names didn't do all that well. check out some of these. pharmaceutical giant merck has dragged the dow down during that timespan. general electr is not a big high priced stock anymore but it dragged 82 poi dow's performance. big blue, ibm. as we talk about the march for the next leg higher in the dow jones in average, we'll talking about whether or not e stocks can turn around or whether the momentum in shares like boeing, home depot and others can maintain

that upside. for "nightly business r i'm dominic chu. to the economy, where u.s. employers created 250,000 jobs last month, much more than expected. it i the latest report pointing to strength in the economy. and as steve liesman tells us, it's the economy that's playing an important role in the stock >> reporter: some stock market surges take flight on the hot air of just hopes and dreams. but this one seems to have some solid economic data keeping it afloat. we got more proof of that today with an adp report suggesting 250,000 jobs created in the private sector in december. that was far more than the consensus, and far more than economists expect for tomorrow's jobs report from the government. adp adds to a running series of economic surprises that's seen goldman sachs' economic surprise index surge to new levels. the street keeps underestimating the strength of this economy. all that adds up to overall economic growth that for three straight quarters looks to be running well ahead of potential

of just around 2%. the second and third quarters in fact offered the first consecutive quarters of growth since 2014. estimates are still healthy for a 2.7% growth rate. there are definitely reaso for caution. the stock market has high hopes for the effect of tax cuts. those tax cuts better deliver to justify recent market gains. in addition, the federal reserve is raising rates as many as three times this year, in part to slow the economy. but for now, better growth and bigger corporate profits are providing real buoyancy for the stock market. for "nightl it seems like nothing, nothing, four days into this new year, can slow the raging bull market. one bear says the conditions are ripe for a potential correction over the next couple of months. but a market bull says there's still plenty of room to run. tonight we're bringing them together, oh, what a fun food fight will be. our bull is the president of

asset management. and the president of james advantage funds. barry is our bear. all right. i think, barry, the burden should be on you to make the bear case here. you think we can have a 15% or more correction in either the first or the second quarter. give me the three reasons why and the one reason, the one thing i should do about it. >> okay. the three reasons. number one, the federal reserve is not turning on the juice. they've turned it off. they are doing quantitative tightening. 93% of the rally was associated with quantitative easing. if you have quantitative could b something. a necessa precondition is extended valuations. price to sales on the s&p are the highest they've ever been. p/e ratios are not as high as they were in the late '90s but they are back where they were in 1987. in addition we have the federal reserve raising rates, not at

the pace we saw in '87. but 1987, bob was talking about no recession, i agree with that, but half the time, half the time you get these 15% downturns when there is no recession in sight. so it can happen. so you've got some pieces of the puzzle in place that are necessary conditions for a pullback. mean there will be one. we would say lower your equities, especially in the e-commerce area. there's a mania in there, very similar to the last six bubbles that we've studied. we would say that would be the area that would be the one that would be the most dangerous. >> there's a lot in there, phil, pick apart. but you think think there is more room to fly. >> i do. when you look at the composite of what's going on, it's pretty powerful. expensive stocks, they're not cheap, but when you infuse a tax cut, that's going to push your p/e higher and justify the higher price. i don't disagree the federal resee is getting more restive.

but look at where interest rates are. companies are earning more than the cost of their debt. until that changes, until rates go higher, it's not effective. so cheap debt, a tax cut, and then the economy is doing pretty well. couple that with global expansion. so when you think about u.s. market, we have been the bellwether, the leader. okay, maybe this is an opportunity to rotate a little bit, to diversify, emerging markets are going well, europe is much cheaper. i don't think it's going to come to an end simply because of low interest rates, an expanding economy. and sue, you can k on the bu push back on the bear. >> you got it, we'll double te >> there are a lot of expectations built in here that the economy will do well and that profits will come in nicely and there's going to be an investment boom in this country. of what some of those things don't come true, or if, for example, the market becomes dissatisfied with even good

economic or corporate news? >> good point. and by the way, 15% corrections, those are relatively healthy, they're not a bad thing, it's like a brush fire, you clean up the brush. in this case it's hard to draw that scenario with the interest rates this low and earnings where they are. you've given everybody a shot of steroids here to pump up earnings. reduct especially in that small and mid-space. in the first six months, you get a pass. beyond that, okay, fair dialogue. but the first six months, you've got too much of a benefit coming from it. >> barry, let me turn to the fed. i understa the fed is tightening. but to phil's point, we're coming from such low levels that the impact on that might be somewhat muted, even if they do become more aggressive in the face of slightly increasingfl >> that's absolutely true. and although the one thing, you kn, this is kind of surprising, when you look at tax cuts, i just wanted to address that, historically, from kennedy

through gw bush, after the tax cut, one year later, stocks don't do very much, because it was all built in ahead of time. we're just seeing the effects today of people being able to digest the tax cuts that came out of at christmastime. it's only natural that they're opening up their presents and stock prices are rising. in terms of the low interest rates, yes, 1987, it grows very rapidly, it went very high. we're not anywhere near that. i would agree that that is not the precursor, but quantitative tightening, that' backdrop that will eat away at some of that confidence. >> gentlemen, you were very nice to one another, you can come we turn to washington now where president tru wants to open nearly all waters to offshore drilling. the proposal lifts a ban imposed by president obama. it gives the energy industry

access to drilling rights in most parts of the pacific, near california, and in the atlantic, near maine and the eastern gulf of mexico. interior secretary ryan zinke said the country is embarking on a new path for energy dominance in america. a seismic shift could be coming to the relatively new legal marijuana industry. attorney gener jeff sessions today reversed a number of obama era guidelines that discouraged the federal government from interfering with state legalized marijuana. and it comes just days after weed went legal in california. aditi roy is i >> reporter: days after cannabis companies ushered in the legalization of recreational marijuana in california with fanfare, a blow from the federal government. attorney gener jeff sessions gave u.s. attorneys the green light to aggressively enforce federal laws against marijuana, even in states where it is

legal. reaction was swift. democratic leader nancy pelosi saying the decision, quote, bulldozes over the will of the american people and insults the democratic process under which majorities of voters in california and in states across the nation supported decriminalizn at th ballot box. cannabis entrepreneurs are also weighing in, one telling me it could be devastating for business and would energize the black ma. others are saying the industry would move to defcon 5 because of this. and the vice president of business daily says businesses could be in for a bumpy ride. but some businesses remain bullish. the ceo of another cannabis company, baker, says, we remain optimistic about the state of the industry. and the executive vice president at aurora, a canadian cannabis company, tells me the effect will be a positive for large canadian producers like aurora,

because it will drive u.s. investment and investors north of the border to publicly listed canadian companies. it remains unclear how the federal law will be enforced and whether medical marijuana companies could be targeted as well. analysts had predicted that california's recreational marijuana market will be worth $6 billion by 2021. .or "nightly business r" still ahead, are computers and smartphones worldwide at risk of being hacked because of a flaw in ? the securities and exchange

commission has for investors. the chairman, jay clayton, urges extreme caution on cryptocurrenbitcoin. he says regulators may not be able to return lost investments to investors. and merrill lynch is banning clients from investing in bitcoin. according to "the wall street journal," the bank's financial advisers cannot pitch investments related to the cryptocurren and they cannot execute client requests to trade grayscale investment trust which is traded over the counter as opposed to a formal venue like the new york stock exchange. the bank has concerns about the suitability of that product. the latest move expands an existing policy barring access to newly launched bitcoin futures contracts. we told you last night about a reported flaw in intel's chips. tonight there's a big concern among businesses and consumers that a vast number of consumers

and smartpho to hacking. shares of the world's largest chip maker fell again in trading today by 2% on an up day. josh lipton has the details. >> reporter: tech companies are. microsoft, amazon, and google are scrambling to push out software fixes to two security vulnerabilitie that could impact millions of computers all over the world. the bugs, called specker a ersp meltdown, could make devices vulnerable to hackers. intel's ceo told cnbc it's not just intel, that many other tech manufacturers and their devices are at risk too. >> i can't tell you exactly on the other guys, on the other products, exactly which ones are affected. but definitely most of the horn question modern high performance processors that you see in leading edge products, phones, pcs, everything, are going to

have some impact. >> reporter: but rival amd seemed to push back on that point, saying in statement, due to differences in amd's architecture, we believe there is a near zero risk to amd processors at th time. in response, investors have sent amd stocks surging higher. on the other hand, intel has been under pressure. importantly, the intel ceo said there is no evidence that any hacker had actually taken advantage of this vulnerability. it's a risk that, as far as we know, no one has exploited. he says there's already a fix to the problem. intel does not expect any material financial impact from the issue. tech giants are moving quickly, updating their cloud services and products, to protect businesses and consumers. for example, microsoft has already updated its internet expl browser. google has updated its public cloud service. apple has yet to comment on the issue. for "nightly b m josh lipton in san francisco. macy's is cutting thousands

of jobs. that's where we begin tonight's market focus. the retailer said it would eliminate about 5,000 positions this year as it shutters more stores to streamline operations and cut its costs. the announcement comes after macy's reported a 1% rise in holiday sales and said it was narrowing its full year sales outlook. but macy's also raised earnings expectations. nonetheless, shares fell 3% to $24.49. jcpenney said strong demand for jewelry and makeup helped the department store chain see positive same-store sas in the latest quarter. the company's e-commerce business also picked up steam. and jcpenney reaffirmed its fiscal 2017 outlook. company shares were off a penny to $3.69. and sears is planning to put more of its struggling stores on the chopping block. the retailer said more than 100 sears and kmart stores across the country will close their doors by april. sears' shares closed down 5% to

$3.58. and sticking with retail, walgreen's boots alliance helped that chain grow overall revenue and same-store sales even as the company's business underperformed. the results were above street expectations. walgreen's said it was hiking the lower end of its earnings guidance for 2018 and it expects to close its $4.5 billion acquisition of 2,000 rite aid stores this spring. walgreen shares fell 5% to $71.60. cvs says it expects a $1 billion gain as a result of the new tax law. the pharmacy and retail chain said operating profit will likely rise between 1 and 4% this year. shares climbed more than 2% on the session to $75.13. costco said same-store sales by demand in the u.s. andmber, abroad. th world's largest wholesale

club retailer also said its e-commerce busines perform well. shares initially rose on the news but then they fell fractionally to finish the regular session at $189.10. many industries are still trying to fi the full impact of the recently passed tax bill. but there is one sector that most agree will likely be a big beneficiary, and that is manufactur >> reporter: so far, manufacturer have been largely upbeat about the tax overhaul and for good reason. one model estimates manufacturers wil see the biggest tax savings. more than $260 billion from 2018 through 2027. not only will many likely benefit from a lower corporate rate, but two big changes could be game changing. the shift to a territorial system and the adoption of full expensing. nearly all of america's trade have territorial systems. experts say implementing a similar model here in the u.s. will help manufacturers better

compete against foreign rivals. and the expectation is at least some of the money will be reinvested stateside. >> shifting to a territorial system will in fact allow companies to move the cash back based on the tax that they paid in each jurisdiction. it will actually i think promote certainly a level playing field and a fairness for u.s. companies to be able to operate kind of on a normal basis. >> reporter: factor in full expensing which will enable companies to deduct the purchase of new equipment up front, and there's much more impetus to invest and expand. caterpillar, rockwell automation, and deere will have r bottom lines helped and other companies will be encouraged to buy their products. this is the biggest market in the world. and now that the pying field has been leveled with europe, canada, and elsewhere, i think companies are increasingly going to look to position their operations closer to customers. it just makes sense that there will be a degree of investment

spending brought back to the united states. i wouldn't overplay it, it's not necessarily goingo happen quickly, but it can happen over time. >> repor only time will tell how many new jobs all of this actually creates. after all, automation and other technology is also rapidly transforming factory floors. whether it's tax experts or wall street analysts or even the manufacturing companies themselves, the widely held belief is these changes will staunch the decades-long erosion of the american industrial base, meaning fewer jobs lost to places like asia and mexico. .or "nightly business r coming up, the big chill all . >> reporter: this is a monster storm bearing down on new england, bringing business all but to a halt. i'm co brewer. coming up on "nightly business t hows, the whys, and what.

insurers will have to pay more than $130 billion in claims for 2017. that is the most ever. hurricanes, fires, earthquakes pushed insured losses to a record last year, according to a new report from munich re. the massive winter storm that's hitting the east coast is packing heavy snow, very gusty strong winds. cities from north carolina to maine were under blizzard warnings. and as the storm intensified, about 4,000 flights were canceled and local economies came to a ne standstill.

contessa brewer is braving the cold tonight for us in boston. >> reporter: there is no way for this to be business as usual, with two to three inches of snow coming down every hour and visibility dangerously low. the massachusetts governor urged workers to stay home and off the roads if they can. >> no, no. because i got to pay the rent. there's no staying home. >> reporter: claud brown and his co-worker are out in it. a ticket for standing on the street. >> 45 bucks. >> reporter: just another challenge to getting their construction jobs done. >> now we have to move it in because it's a parking ban. later on tonight we'll have to go shovel. >> reporter: the roads are bad. in spite of the salt. the plows working overtime to keep maine roads clear. thousands of flights canceled, planes grounded across the eastern seaboard. a snow day for schools. a workday for many. power companies in massachusetts hired extra crews to tackle

broken power lines and downed trees. after more than a week of frigid temperatures, the trees are brittle and susceptible to snapping in blizzard force winds of between 30 and 60 miles an hour. new englanders themselves may be somewhat tougher. >> i just came from the gym. i just went for a swim this morning. there we people there. but the good part is i had my own lane. but it's, you know -- we're hardy, so we c abou >> reporter: roughly 60,000 companies in boston, many of them closed for the storm, hospitals, hotels, and others, provided overnight accommodatio for essen staff. at work too, with coachayers bill belichick telling the team they better show up on time for practice. the next phase following the snow is a dangerous, brutal cold snap, especially vulnerable will be those who lose power. in boston, contessa brewer, "nightly bus >> i'm glad i'm here in a nice, warm studio.

before we go, here's another look at the record setting day on wall street. the dow advanced 152 points, topping 25,000 for the first ever. nasdaq added a dozen, and the s&p 500 was up almost 11. >> what a day. >> cold night, cold day. >> drive carefully if you're out there. that's "nightly business r for tonight. i'm sue herera. thanks for joi us. >> thanks from me as well. i'm tyler mathisen. have a great evening, everyone. stay warm. s

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