this is nightly business report with sue herera and bill griffith. >> monday blues, stocks selloff as investors are rattled by trade tensions. even as therihite house tes to walk it back much economic momentum, optimism a is at record, new home sales surging. is the-h r economy too hot. moving out, harley-davidson is p shifting somduction overseas. and the american icon is blaming tariffs. those stories and more tonight on nightly business rort for monday june 25th. good evening, everyone, welcome, bill is off this evening. it was a rough way to start the week. the dow fell sharply, recording its ninth decline in the past 10 sessions roughly hal of the s&p 500

sectors closed in connection ve territory, the beloved tech sector got hitard as trade anxiety spread through the market and unnerved investors. the dow jones dropped 328 the nasdaq was down 160 or more than 2%. the s&p 537 fell bob has more on today's selloff from the new york stock exchange. >> stocks sold off as trade tensions rose again today with the dow erasing all of its gains so f injune, and ending in corrective territory. it was risk off ally, with the usual crop of industrial stocks and materials down, those are trade worries that happens all the time. the damage is a little broader thant t today. they also gave investors an excuse to take profits on overheatsed gains. netflix fell today after surging more than 100% so far this ye. tflix isn't in china.

other stocks like amazon, facebook, alphabet, they wereut all down a 3%. other big momentum mes like ali baba and twitter were all down singledi ts. even the small c russell 2000 which had been immune to trade war worries dropped 2%. the wall street journal reported presidentbrump might c chinese investments in u.s. tech stocks. they suffered theirin worste day decline in two months. sphb has fallen more than 4% over the last two weeks. stocks came off tirows late in the day, when the president's national trade council director peter navarro told t cnbct the white house had no plans to impose investmentct restns. it's not clear what he means or whether this contradicts t president's statement, that's part of the probleme got.

>> where does the president's strategy onrade actually stand? kayla tries to make sense of the latest twists and turns. >> president trump is considering limits on china'sability to invest in a u.s. tech sector. sending a deadline to invest such lims by this week. steven mnuchinat said the ent would not be specific to china, peter navarro said that's not the plan. >> the only thi that's going to happen in the near term is on friday. goingeasury department is to report to the president about the issue related to china, that's all that's going to happen. with respect to other countries, there's nothing on the table.re fears growing that the chinese will hit back hard, disrupting u.s. businesses by delaying deals and licenses, holding up cargo at the ports or even devaluing its currencies. >> w tarehered at the hip with china. they have many different tools they can use to fight back.

>> president xi warnedestern ceo's in beijing last week, it would strike back. u criticizing t. and calling on companies to take the road of reform, opening up innovation and development. and not to go backward to isolation. inflexibility, protectionism and unilateralism. chinese investment in they .s. has alrellen. foreign direct investmen is already down to $1.8 billion in the first half of the year. that's down from ro90% the same time a year ago about. >> we're probably now living in the new norm that the tariffs are likely to go in place they're likely to stay in placeh investment restrictions are likely to go in place and stay in place. the proposed tariffs only pose a modest risk to owth. but t risk of escalation is far greater. >> as investors watch the trade

back and forth, how much more selling can we expect. paul schatz is president of heritage capitol. welcome back to the program. >> i think it's probably pretty obvious we suld expect volatility certainly, where do you think we stand in terms of the cycle of the market and the se selloff. >> i tnk -- listen, the dow saw a peak on january 23rd. the other parts of the market already made new highs this quarter. so most of your watch probably looking at the dow and the s&p 500 which are maski someunderlying strength, we really have -- the market's been in good shape. shortelling is a very term bout of weakness, i think it wraps up in the next five to ven trading days, and then i think the next quarter which o begi monday. we're going to see the dow hit at least 27,000.i hink short term pain,

intermediate turn in. ch went so far so fast, but i don't think the run is over. it may see some leadership, other things may lead. i don't think the tech bull market is over>>yet. f you are a longer term investor and you see a day like today. do you use that opportunity to go in and add to positions o look for new positions? because you are bullish longer term. >> i am, and i think the long term investor should view a day like today as somewhat noise. it's really short term noise. the dow is 24,000. so 300 points on the down side really doesn't mean at. if a long term investor had some cash. i wld start looking at the value names, which would be the more beaten up ones. i would not -- if i was a long term investor, i would not look at the fang stocks. even if they continue to go up, they cerinly have more risk than some of the names that have been under pressure this year. so i look at stuff that hasn't

gone up yet, maybe even going to consumer staple b which would the supermarkets, the soaps, the olgate, clorox, the mercks, pfizers, stuff likthat, even the regional banks. i don't want to chase the stocks that have had these meteoric rises in the bull market. i want to find the stuff that has somevalue. and probably is going to pay some good healthy solid dividends for that long term investor. >> on that note, thanks very appreciate it. >> to the economy now, and a surprising surge in new home sales. purchase of newly built single family homes grew a lot more than expected last month, and the rise comes despite high prices and low home inventory. but there's a catch. diana olick has the details. >> home builders didn't start more homes in may compared to april, but they did sell more homes.

sales of newly built homes jumped wider than expected, 6.7% after april's read was revised down. here was one more devil in the details. >> all the growth in housing, new home sales is in tso h, warehousing is affordable. and that has implications going-forward. if interest rates ticked up sharply, will it not even be affordab in the south. >> sales jumped dreatically in south, which is where builders are business jest and prices are the lowest. it may be why the medn price of a newly built home dropped 3c in maypared to a year ago. builders are not really focused on lower priced homes, because they can't make as much money on them, especially as the cost f land, labor and materials continue to rise. mortgage rates continued their charge higher in may. and while they didn't seem to heyt much in the south, likely contributed to the drop in sales in more expensive regions like the west. >> the bottom lineis, they're

going to hurt sales going-forward. they probably aret going to go up that much more. >> interest rates may not go up a lot more,hey willontinue to edge higher. prices for existing homes continue to risepl sh and 3wi8ders are certainly not lowering their prices. add it up and housing just continues to get more expensive much diana olick, in washington. >> that strong housing market may be contributing to a ris in economic optimism which according to the latest cnb all america survey is at a remard. steve libreaks down the results. >> american economic optimismtt g a new record in the 10 year history of the survey,ith 54% of the public saying the economy is good or excellent and a record low 43 percent labelling it just fair or poor. it's the first time americans ave called the economy

excellent. >> those saying the economy will get better is down a bit, but cnbc pollsters say that's wheou you expect these are the current situations are so strong. arepositive economic views helping the president with 51% approving of his handling of the economy. it's the first time during the trump presidency he's gained majority approval on the measure. still, just41% approve of the jo he's doing as president. up just 2 points from march. the percent of aricans disapproving has fallen by 10 points. that could be a sign of disagreement on other signs of theeconomy. ericans are bullish on expected gains, the rise in gas prices has not affected their driving habits very much. confidence in stocks has fallen while the market has turd sideways this year. it remains above its long run average. now is a good time to vest. 21% say it's a bad time. 31% say theyon't ow. for nightly business report, i'm

steve liesman. the latest data is indeed solid, is the economy on the brink of running a bit too hot?t and willde tensions cool things off? we're joined by the chief economist at vining sparks. good to see you again. >> good evening, sue. >> let's get the trade discussion out of the way. what type of impact do you think the current trade dispute and/oi taffs may have on the economy? >> we thinkl it w be fractional, the biggest fear is that this escalates from here, did you look at the trade tariffs that have been put in place so far, the impact to growth should be minimalo the impact inflation should be minimal, throws are the two things we should look at as far as our impact to the economy. as long as they don't escalate -- as long as it doesn't escalat into a trade war, the impact will be fairly small. >> you do think f that the might have a bigger impact net net on the economy.

something that industrials should watch, why? >> based on the previous stories, you just discussed, the economy is very strong right now, if you look athe consumer, the unemployment ratew is to 3.75%. consumer confince is as high as it's been in almost 20 years. if you look at the business sector.re businesses as confident as they've been going back to 1973. their outlk for sales very strong. if you look at the government sector, we have a fiscaloost coming from the increase in the spending caps. global growth has been very strong. you've had this confluence of events where everything has become a tail wind. and so the fed looks at this scenario andhey start to -- they become more hawkish. we'v seen them hikeates already, and now they're going-forward, projecting more hikes and so that is -- they annound in their projections,

they have projected two more hikes this year instead of one. you seeec theming hawkish, it looks like we're toward the later end of the cycle, and as the fed is hiking, i think that hasen the pal to really point to the end of the cycle. >> in other word they mig hike rates just a little bit too much? they may tighten tooquickly? >> that's the risk. and, you know, especially if they become concerned about inflation. righ now, inflation continues to be fairly moderate, if they start to become too concerned about it,hat's what happened in '89, 2000, 2006, you look back at their statements, they inflation, ed about so they hiked rates through longer term rates. once that ihappened,s an indicator you're going to have a recession. >> we will b watching. it is time to take a look at some of today's upgrdoes and grades. microsoft was upgraded to overweight fro neutral at atlanta equities.

microsoft has successfully anaged its transition to a cloud basedcompany. the price target is $125. and on this down market day, shares of microsoft fell 2% to 98.39. intel was down graded from neutral at bye. last week'sbrupt departure as well as uncertainty about the chipmaker's longer term prospects. the price target 55. the stock dropped 3% to $50.71. kroger was downgraded to hold from buy over a pivotal research. the analyst sites the stock's valuation following a 17% gain over the past moceh. the p target is $31. the stock fell 1%. >> still ahead, women get behind the wheel in saudi arabia. and s er their way to economic opportunity.

the supreme court handed american express a legal victory. american express h a policyf not allowing merchants to encourage customers to use other lower fee credit cards. th policy does not violate antitrust law. that sent the shares higher by more than 1%, making it one of the best performing stocks on the dow index today. investors slammed the brakes on shares of harley-davidson today.

the reason they're moving production out of the united states? to avoid thoseew tariffs in europe that will jack up the cost of selling the motorcycles in thatregion phil lebeau has more. >> reporter: harley-davidson is hurting. m theotorcyclelr maker ady struggling with slower sales in the u.s., is already facing a big hit due to tariffs in the eu rket. the average harley sold in europeill cost another $2200. a 90 to $100 million hit to the bottom line annually. as a result, harley is shifting some of its production overseas. the company says, we're currently assessing the potential impact. on our u facilities. we are hopeful the u.s. and eu governments will continue to work together to reach an agreemen on trade issues and

rescind these tariffs. >> i think things have moved against them in a number of ways. the trump economy has not been very good for rley-davidson. harley-davidson moving some production out of the u.s. paints a far different picture of the compa e he'sraced and praised publicly. >> thank you, harley-davidson for building things in america. s know your business is now doing well, i a lot of spirit. >> outgoing speaker paule ryan whistrict borders harley's headquarters in milwaukee, ac d to the news saying this is further proof of the harm frra unila tariffs. the best way to help american workers, consurs and manufacturers is to open new markets for them, not to raise bawniers to our market. this is the latest head wind for harley-davidson. business has been slumpingceere nou.s., where it sells two thirds of its bikes.

competition has stiffened in asia, where the comny is preparing to open a new plant in thailand. and in the next twos, ye harley-davidson plans to expand its production overseas. elp itin theory could limit the cost of tariffs. all while diversifying its manufacturing footprint. phil lebeau, nightly business report, chicago. shares of carnival sink the most in more than two years. that's where we begin tonight's market focus. the cruise line operator slashed its full year guidance. blaming unfavorable currency exchange rates. the company should get past that. >> the arket isreacting to a lowering of guidance from the march guidance, it's still higher than the original guidance forhe year. we are offsetting a 19 cent drag in fuel currency. so that resulted in a lower guidance for the rest of the year.

but the reality is, that that's all that's going on, and,ur of , we're going to work hard to beat that. >> shares ofarnival fell just about 8% to $58.54. that dragged royal caribbean lower by 5%. general electric is selling its industri engines unit to advent rninional. for 3 and a quarter billion dollars. that move is part of the plan to streamline and sell $20 billion in assets by the end of last year. ge sold its railroad unit for about $11 billion. ge was off more than 2% by me than$2.75. kraft/heinz is interested in buying campbell's soup. investors ate it up, sending campbells up 40%.

kraft/heinz up a kraks. at&t is buying digital ad mpany app nexus. the move allows at&t to better compete with google and facebook for ad dollars. shares of at&t rose to $31.71. yesterday history was made in saud by arabia, where women were allowed to drive for the first time. saudi arabia had been the only remaining country where women had faced fin and arrests for driving. hedley gble is in riyhad with what women behind the wel ght mean for that kingdom's economy. today women in saudi arabia can fina iy drive. >>'m very happy. >> it's the latest move by the country's crown prince to transform a traditional society into a 21st century economy. >> we've come a long way

actually. t right now wit new vision, that we have in place. his royal highness announced two years ago. >> saudi women makep just 22% of the country's total labor force. withhe government hoping to boost those numbers to 30% by he30. >> whileovernment hopes that putting women behind thewh l will cut down on an over reliance on foreign labor, they also hopet means added opportunity. >> one of the first companies to get on board. t aimi sign up as many as 20,000 female drivers by 2030. >> you decided to become -- >> why? >> why no >> because i can do it. >> women have been ready for q that forte some time. women have been slowly integrated into the workforce. i mean, in every field, you see women now. d it's breakinn barriers, isn't it? >> it is. >> those rapid refms have finally put women in the

driver's seat, questions remain over how quickly the saudi vision can deliver. >> for nightly business report in riyhad, i'm hadley campbell. how a start-up is using food therapy to defeat diabetes. re's what to watch for tomorrow, housing grabs the spotlight, with the release of the april s&p core logic index. e market will be looking to see if home prices picked up during the spring selling season. we will get a look at manufacturing when the richmond feds june index comes out.

and we'll see how the consumer kneels about the economy when the ctsference p its latest confidence index. that's what to watch for tomorrow. the man in charge of the new health care venture established by amazon, berkshire hhaway and jpmorgan wants to see waste reduced.ystem speaking over the weekend at the aspen spotlight health conference. they appear to be focused onhe middlemen. >> one source of waste is ourve high administrative costs. there are a lot of middlemen in the system. there have to be solutions that simplify that. o take somthe middlemen out of the system. nscond there has to be solut around pricing that's another bucket. but the biggest bucket is miss utilization, often the wrong time in the wrongar in the wrong way. we have the wrong care pushing out the wrong care. >> they will initially seek to

improve care for the 1 million individuals who get their insurance from amazon, berkshire and jpmorgan. if tsuccessful, blueprint could become accessible tohe as well. diabetes medications are big business for the drug industry. the disease is still on the rise. as meg terrell tells us in tonight's modern medicine. one siliconaly start-up is trying to build its business model around food as medicine. >> an elite triathlete, he was shocked when he discovered he was tipredia >> i thought this is nuts, nobody can exercise than i do,n and you be leaner than i am. >> he found scess with the ketogenic diet. h he's tak experience into a

new ccompany,alled verta health. gary moore diagnosed more than five years ago with diabetes. he was dependent on insulin to control his blood sugar. >> g that a 1 c down. no more diabetes for gary. he works through texting and vide chats to change his eating habits. >> all my life i have eaten what i wanted to eyeat. eventually found in after 6 i was nths of trying, over eating. >> since he started almost a year ago, he's lost more than 50 pounds. and his blood sugar is under control. so much that he's been able to stop taking insulin. 60% of his patients reverse diabetes. >> with those results come cost savings. $9600 on average in theo first years on drug and medical costs. the program costs$370 out of

pocket per month. for gary moore, it's been worth it. >> they saved my life. what is your life worth. >> for nightly business report. i'm meg l. before we go, here's another look at the sell f ones wi wrls today. the dow dropped 328 points. the s&p 500 fell 37. that is nightly business rort r tonight. i'm sue herera, thanks for joining us, have a great evening .and we am see you tomorr

♪ >> this is "bbc world news america." >> funding of this presentation is made possible by the freeman foundation, kovler foundation, pursuing solutions for america's neected needs, and purepoint financial. >> how dwe 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 everythinghat