this is "nightly business report" with sue herera and bill griffeth. >> tug of war.oc reverse course and make a comeback, but the bears may t still havehe upper hand over the bulls. the u.s. trade delegation arrives in china, but can a grand bargain be reached? breaking new ground. a high tech solution to the construction industry's labor shortage. ose stories and much more tonight on "nightly business report" for this thursday, may the 3rd. >> good evening, everyone, and welcome. is your head spinning? because that'f kind of day it was on wall street. the dow was down nearly 400 points midday, and just when it looked like the bears were in control, stocks erased most of their losses. when all was said and done, here's how the market closed.e

dow average rose five points to 23,930. e nasdaq was off 12, and the s&p 500 fell nearly si here's more on this while wind day on wall street, and where stocks may go from here. >> reporter:hese days you can go through an entire investment cycle in just one afternoon. just look at what happened today. we opened down, but when the s&p broke below a key technical levesw the market ned, the s&p falling more than 20 points over the next half hond. arlunchtime, the markets turned around. and investors appeared to be trying to bicek fuy sectors, co staple stocks, industrials, even gold. it all rallied into the green in the middle of the afternoon. that's good news, it suggests there are attempts by some traders ang fint least some short-term bottom. it's about the only good news the bulls hav had in many days.n

eaings have been way better an expected, but the market has yawned. bears are claiming it should sell off because the feds are raising rates and we're entering a seasonally weak time of the year. mthe bears havee two claims, that globalrowth is exploding and inflation is picking up. bulls g insistbal growth remains strong, but for the moment, theears seem to have the upper hand. >> so will the bears continue to have the upper hand? joining us tonight to try to make sense of this kevin coroni, co-founder of washington crossing gavisers. to see you again, kevin. >> thank you for having me. >> this is areat environment, you would think, for the stock market, with earnings as strong as they are, rates still relatively low, and unemployment at record lows, as twell. so w do you think is going on here, what is the market trying

to tell us? >> ihink t market is actually doing investors a favor in a sense. put it in context. we came into the year with tremendous momentum with the markets surging. and as we came through the spring, wee have seen s chopiness. but that's a reversal from a really strange 2017, when volatility was extraordinarily low, a asset prices were moving very rapidly as earnings were coming up underneath it. but i think that where we are now, with thein markets m sideways and earnings surging, valuations on stocks areng loo more healthy than they were just a couple months ago. so that could be aood thing going forward. >> so it sounds like longer term you're bullish, but we probably still have a adline risk? >> yes, ultimately, as long as we avoid having a further slowdown in the economy, just mention some slowing in the global economy, as long as the economy hol up and earnings

continue to advance as expected, anysts are looking for 7% growth this year. i think we can get through this very nicely with stocks outperforming bonds, even though bond yields have been backing up. >> where do yout see the b opportunities right now in the equity market, kevin? >> i would look for steady companies. like the fact that consumer staples are just that. and they have underperformed faster growing segments like technology the last couple of years. when you look at relative valuations, i think that consumer staples are actually one of the more interesting places to go these days, even though the growth rate is lower than what you would find in let's say >> kevin, always good to see you. thanks again for joining us. >> thank you very much. to the economy now. the trade deficit narrowed sharply in march. exports increased to a record islped by a in deliveries of commercial aircraft and

soybeans. the trade gap dropped to $49 billion, that decline ends six i straight monthreases. that same report showed the u.s. trade deficit with china also declined, just as the president's top advisers arrive in beijing for their high stakes talks on how to avoid a trade wa between the two economic superpowers. here's our story from bjing. >> repter: treasury secretary mnuchin and his team have wrapped up tir first-day meetings in beijing. there is a lot at stake. the w trade would be costly for both countes. however, there's a feelg it will be challenging to get a grand . resolution secretary mnuchin and other u.sd officials sai before they left that they wanted to talk about and make progress on a range of issues, like cutting the trade

deficit, force technology transfers and china's industrial policy. however, china's industrial a polici core to beijing's national economic agenda and getting the chinese to change their practice also be very difficult. the chinese, through officialst ements and media, have been sending conflicting messages. on tne hand, they want to appear conciliatory. the china daily ran an editorial with the headline, the art of a deal is when all parties are happy with it. on the other hand, they want to showhihat has leverage and won't back down. chinese state tv highlighted today that portersere completely stopped buying american soybeans in the pt two weeks. elso, my sources in the chinese government toldunlike in past trade negotiations, there wasn't a lot of preliminary work this time around. the standard has been that working level folks get together, they hash out all the details before the senior officials arrive. so there's a b a question to

how much they can accomplish in a short perd of time they're here. >> so wt is expected to develop from these talks and hat should the u.s. focus o accomplishing? here to talk about that is ed mills, washington policy analyst. we always have you on when we have these high stakes situations come up, and this is them.f she just pointed out something interesting, that they haven't had the wpremeetiking groups in china. so given that, and giv the expectations, will we see this grand bargain or >>not? 'm skeptical of a grand bargain, i think the best case scenario for right now, what we would hope for is to kind of lad the gr making sure we actually have some of the first meetings between kind of our leaders ofhe economy, and china's leaders of the economy. i continue to believe that the

headline risk here is going to get much worse beforet gets better. i still think there's a lot of u mi on both sides. trump really feels he has to hittingting back and back hard. so that's going to be really difficult, and don't forget that oner rather than later, congress is getting involved here, and it's starting to look at legislation that could be anti-china, which could blow up the deal it's a hard thing to keep that fragile flower of consensto ther. lots of reason why is a grand bargain can't happen just yet.>> we know that china is a mmunist government, a capitalist economy, sort of. they don't worry about subsidies to industries lik steel, b we do. and we feel that's unfair. secretary mnuchin sai he doesn't want to change the chinese structure as it is. but i you don't d that, how do you come to an agreement of some kind? >> yeah i think it's very hard. i think what we're waiting to see from treasury the most is

they are as part of the ecutive memo, treasury has to come up with a list of investment restrictions on china, in specific technologies, in different industries. china has this list of things they want to be the worldwide leader of by an2025. so that's the chinese subsidies that are going to go to those domestic industries. what i think treasury is goi to say is does the u.s. have technology that they need to meet those goals? and why are we that to them?e so that's real leverage from secretary mnuchin's stand point. >> you mentioned that congress is getting involved, andsu tr. does that mean that there's market headline risk if things areo goinget worse before they get better? >> yeah, this is the number one thing i'm talking to clients about right now. one of the things that we're concerned with isha too often, we don't know exactly when the next shoe to drop is. know, t we look at, you

kind of the required things that are coming out of treasury, treasury could use something known as iepa, which is wartime wers to restrict commerce. and we're going say are there things that china is trying to be a global leader of, semi conducrs, a.i., looking at kind of the buildout of telecommunicions technology to get 5-g. if they came out with a list and saying no u.s. company can do business with this, the market is not going to like that at all. and if congress follows up,'s th bad one-two thing. >> ed, thank you so much. >> pleasure. >> i ink. given what we have laid out. >> mills. bill? ore economic news now. new applications for jobless benefitsnched higheast week, but the rise was less than expected. according to the labor department, initial claims for unemployment benefits rose 2,000 to a seasonally adjusted 211,000, and despite the increase, claims remain near historic lows, pointing to a robust job market.

and the mthly jobs report is due out tomorrow. the unemployment rate is expected to tick even lower to about 4%. but a persistent problem lies behind those numbers. many young people who could work are not, and they're not attending school either. but now a coalition of corporations is t ing to hel get them hired. kate rogers reports tontght from atla >> reporter: thousands of young people packed the georgia congss center eager join the workforce. bi companies from starbucks to fedexre bandingogether to give them an opportunity. >> if they do give me the time of day when i interview, i'm going tock kno it out the park. >> reporter: across the united states, more than 4.5 million people ages 16 to 24 aren not i school or working. the 0100, opportunities hiring fair wants to change that with the help of company recruiters and executives.

fairs have been held across the country and this band of companies is committed to 1 million hires by 2021. >> we know these are the leaders ofizations tomorrow, and the best we can do to help them grow within an organization, it's going to be better for fedex in the lg run. >> reporter: job seeker also get advice on what to wear to interviews, resumes, and on the job training. starbucks chief operating officer, he said workers send to stay and rise through the ranks. >> it begins our conversation about who do we want to employ in our stores and we want to give everyone the first this is the part of our country and nation that usually gets forgotten about. >> reporter: and for some, the day has a happy ending, leaving with a job offer in hand.

>> it was really nice. >> reporter:ate rogers, atlanta. time to take a look at some of today's upgrades and downgrades. caterpilla ws rating cut to neutral from overweight. the analysts cited a slowdown in sales. price target was $1ar. fell a fraction. 3-m saw its rating raised to outperform. thed analysts c an attractive valuation after a four-month swoon. price target now $2. the sto closed at $195.65. >> nvidia's rating was raised. the firm cites increased demand for semi conductors over the next several years, but the analyst admits he's behind the curve on this call. the pri target is$280. the stock rose nearly 3% to

$232.99. sales force was upgraded to marketerform from underperform from over at bernstein, citing th company's abili to generate better revenue growth. the p ice targe $125, where the stock sloesed today. >> still ahead, why goldman sachs may soon start trading the crypto currency bitcoin. the former ceo of volkswagen has been charged with conspiring to defraud the u.s. the charges against martin wintercorn are related to the diesel emissions testing scandal. the indictment was unsealed today. he stepped dow as ceo in 2015.

he's in germany right now, and he's not at this poi custody. activionlizzard reported double digit growth for revenue and profit, tending off competition from that h new rival game called rtnight. activision earned 38 cents a share, revenue rose by 15% to more than $1.3 billion. and the stock closed the regular session lower, despite an early release of that better than expected report. julia has more for us. >> reporter: activision reporting better thante exp results, showing the growth of fortnight from epic games is having no impact. activision blizzard's own dital businesses are thriving, hitting record first quarter revenue.e eo saying as we look ahead, initiatives will continue to drive growth for our business.

the company just launched its inaugural regular season overwatch in januy, and says it's reaching millions of viewers every week, leading to increased hou playing the game. more growth is expected with the playoffs coming this summer. some expected rival games like fortnightose a threat. it quickly became one of the most popular games out there. julia is back with a look at the fast rise. >> reporter: fortnight is three to play, and accessible across consoles, and mobile u devices. yon play with your friends, as many as 100 players can anrticipate in the battle royale mode. players can pay for fun add-ones. like costumes and dance moves for theirav ars. the success benefits private

gamemaker epic games. isney owns a percentage of epic, acquired by hosting epic its start of accelerator last year. and amazon saw its march traffiu rge 40% thanks to fortnight. i'm angeles.stein in los cardinal health shares turned sickly. that's where we begin tonit's market focus. a sharp decline in profit, lowering the full-year outlook, nvcitingtory that could not he sold and drug price deflation, sendingtock down more than 21%, the largest percentage decrease since 2004. it closed at $50.80. health inrer cigna placed outlook. the ceo says there's no need to

worry. >> our two companies are trulyy complementf one another and don't have material overlap. >> shares finished up fraction at $172.88. and tepa pharmaceuticals raised its outlook. reporting a smaller than expected decline in its first quarter profit and revenue, and said it expects its new migraine drug to be approved by the end of the year. shars finished down more than 4% at $17.78. and after the bell, cvs reported better than expected iaofit. the m company, which is in merger tks with viacom, sending shares up initially in after hours trading. shares a finished 48.74. let's turn now to the topic of bitcoin. while many large banks have

keeping their distance from that accryptocurrency, goldman just a few months ago said it was at least open to i >> i will tell yt hasn't crossed my desk to set up a bitcoin trading desk, but i get asked questions, is this -- is bitcoin the worst thingn the history of the world? i have to say, i don't know. mean, i have more open mind about these things, because there's a lot of things that work really well today that i thought were stupid and wrong and i have a much more open minh about. >> well, now the investment bank is embracing bitcoin. the question is, does suc a move by such a large highly respected bank legitize a largely unregulated virtual herrency, one that's been called everything from future of money to a fraud. and will other banks follow joining us tonight, campbell

harvey, professor of finance at duke university's school of business. ks for joining us tonight. >> great to be on the show. whats a crazy trend this is. you have so many propones on one ,si that are highly respected. what do you make of gsadman s' move to open a trading desk and what will impact will this have >> it is no surprise to me whatsoever. what is under the radar screen, this is part of a longer term plan that goldman had. they were an early maj investor in a crypto artup called circle in 2015. and circle's gotten an exchange, so they've been in this game underhe radar screen for three years. this is the culmination of that. strate they cannot ignore a market that is like a half a trillion market. they have to be there, and i

thek they cannot wait for thin tech firms to eat their lunch. >> there are those who say if anybody is going to do it, it should be goldman sachs, because of their htory with risk management and their reach. do you agree with that? >> yes, absolutely. again, they've got this longer term vision. they're known for innovation. they see the threat of tech, they see thi as major market and a firm like coin base hasar 20 million customers. and probably making $50 million a day just in fees in trading yptocurrencies. how can they not be in this market? >> what is the message this sends to individual investors ho out there may be intrigued by all this and now they see goldman sachs getting involved? >> yeah, so one of the - proble it's not just individual investors but

institutional investors. we have some futures contracts that are availablebin oin, but they're very small in terms of volume, and problematic for institutional investors. they've been waiting for an a-level investment banko pull the trigger. obviously jpmorgan wasn't going to pull the trigger, but goldman was there to step in. this makes it a lot easier to trade this market, and i think we'll see much more participation, and kind of validation that this is a reali >> something to keep an eye on. campbell harvey at duke university, thanks again for joining us toght. preciate it. >> thank you. coming up, we'll show you a new way to build homes. >> a new startup is taking real estate cstruction out of the jobsite and into the factory, saving on cost, a labor, increasing productivity. we'll tell you about it coming up on "nightly busin

>> hitting multiyear highs, according to freddie mac, the average rate on a 30-year fixed rate mortgage dropped to 4.5%, likely apo try reversal in a year that will bring steady increases. >> the construction industry as wenow is facing a severe labor shortage, and it couldn't com at worse time. workers are needed to build homes, to help alleviate the severe housing shortage we have seen. what if there was a high tech lution to build more with less? that's just wha one company is doin and it's getting the attention ofevelopers and investors. diana is in phoenit.for us toni >> reporter: in an unassuming

phoenix factory, a team of techies is up ending the way buildings go up. >> furthest to the right, we have our cabinet shop. >> reporter: using high tech to build efficieies for design. material supply. manufacturing. logistics, and assembly. the goal, remove, ti cost, and especially labor from construction. >> in my past, we built electronics componts, telecom infrastructure. today, we're taking the very same principles andeally applying that to the components that go into building and we're building factory instead of out in the field. >> reporter: catera is barely three years old but changing the ley, ofsin,po t il especially when designed usi virtual animation. they put large sections of a

house or building together in a factory. winds,s, do a full kitchen, all done. and then send those parts to the joite for assembly. managers on site follow instructions on an ipad. >> because we have an amazing catalohere, we're able to select the finishes for a project very we can do a full multifamily project within an hour. >> reporter: the foundnd ceo michael marks used to head up an electronics company and spent time at tesla. he claimed it was not a difficult transition. >> it's justg apply manufacturing techniques, if you will, to the construction oesn't y, which just happen. >> reporter: the company recently got an infusion of nearly $1 billion from softbank, bringing the total value to about $3 billion. and they just announced they're acquiring a construction company in the northet, building on a model that is clearly working. >> we're winning business everywre and we need the people to build them.

so we're just growing at a breakneck pace. >> reporter: they have over $1 billion of projects in the pipeline, all of them unique. technology takes the cookie cutter out of the mix. before we go, a final look at the numbers today on wall etreet. the dow r five points to 23,930. the nasdaq up 12, a the s&p 500 fell nearly six. that will do it for "nightly businesseport" tonight. anks for joining us. >> have a wonderfl evening. wee you tomorrow.

>> this is "bbworld news america." >> funding of this presentation is made possible by the freeman foundation, kovler foundation, pursuing solutions for america's neglected needs, and purepoint financial. >> how do we shape our tomorrow? it starts with a vision. we see its ideal form in our mind, and then we begin to chisel. we strip away everything that stands in the way to reveal new possibilities. at purepoint financial, we have designed our modern approach to baing around you --