>> announcer: this is "nightly business report" with bill griffeth and sue herera. >> sentiment shift. stocks rise to start the week and many point to wall street's tter mood. > fighting cancer. eli lilly is the latest drug company to make a big bet on lo on. as the science evolves and ground-breaking new medicines are discovered. pricing power. it's going to cost you more to go to disneyland, but wills consumeray up? those stories and much more tonight on "nightly business report." it i monday, january 7th. good evening, everne, and welcome. the big rally friday extended into today. investors started the week in a buying mood, snapping up shares of technology stocks, as u.s. and chinese officials talked trade and the price of oil rose.

the dow jones industrials rose 98 points to 23,531. the nasdaq added 84, the s&p 500 was up 17. asusual, there w volatility. but there was also a sense of relief, which stand contrast to what investors were feeling not too long ago.sa bob explains. >> it's remarkable how much market sentiment has changed just over the past few days. investors h had a long list of concerns but they're finally starting to see some progress s made oneral fronts. there were worries about the fed raising rates too quickly,rade talks going nowhere, the chinese economy slowing down and a possible recession. now the fed chairman softened on interest rates. isome powell said he listening carefully and that the fedns remaiatient and flexible when it comes to rate hikes. trade talks, the second issue, are pickingup. high-level officials from the u.s. and china are meeting today

and tomorrow to tryo hash out the terms of a deal. third, there's hope for the chinese economy. china announced stimulus programs tooost infrastructure spending. expectations for earnings growth in the united states are coming down this year,t but could be a lot worse. most of them are in the midsingle-digit range. gas prices have fallen 20% since october. at is a huge tax cut for the american consumer. how about thisear of recession thing. strongerob growth and comments from the fed are fending off those concerns at least f now. the one wild card is political risk both here in the united states and overseas in europe. the fateuk of the and brexit is murky. now here in the u.s., now that former u.s. defense secretary jim mattis and another key moderates are gone, maybe it' president trump and not the fed that might make some policy mistak here's the bottom line. we are not out of the woods, but

the trend is definitely improving. for "nightly business reportm bob pisani at the new york stock exchange. alwell, let's more about this possible shift in sentiment. christina hooper ih back w us, chief global market strategist and vesco. good to see you again. welcome back. >> good to see you. >> of the twosrimary iss that bob brought up, the fed tnd therade tiff with china, are you feeling better about those as well? >> i'mot feeli a lot better about either one. >> okay. >> while i o hold hope that the u.s. and china resolve the tradeissue, i'm very realistic that it's unlikely that we'll see a reolution any t soon. bob reported on how china is ti increasing dom stimulus. to me that's a sign that it is hunkering down for what could be a protracted fight with the u.s. regarding trade. >> and what about the fed, christina. there was confusion early on ans then just week it seems as though the market was kind of

soothed by what the fed chief said. >> well, certainly the market was temporarily soothed, but we need to see more than just words. what's gng to be critical is the fomcmeeting, the statement coming out of it, to see if the language has become more dovish. if there's more rteration that the fed is truly data dependent. what could really boost marke is if the fed came out and said it's also exaning balance sheet normalization and considering whether or no k to actualp it on auto pilot. those are all things that could truly soo me markets fore than a day or two. >> so what are you doing about that as far as investing in this market? do you go defensive? more to cash? what are you doing here? >> wes, we alw maintain a very long-term perspective, but for those who are thinking about the shorter term, you certainly need to be prepared for more volatility. now, some view that as a real opportunith they have c on the sidelines,

that can present attractive purchase opportunities for investors. but for those who are worried about volatility, that have trouble stomaching it, it is important to be very well diversified. and that includes not just equities and fixed incomeut having exposure to alternative asset classe l thingse real estate, gold, tend to move in a less correlated way with stocks, for example. so that makes a lot of this kind of environment. >> diversification is the word, i think. christinaooper with invesco, thanks again for joining us tonight. >> thank you. more nown those trade talks. the u.s. delegation arrived in china for those discussions aimed at ending the teneons that hmposed billions of dollars in tariffs over the past year. >> reporter: this is the first face-to-face meeting between the u.s. and china sinceum presiden and president xi sat down for dinner at the g20.

trump discussed the prospects of a deal during a tretreat camp david over the weekend and he reporters that he is hopeful. >> my relationship with president xi is as good as any relationship that a president here has had with a president or leader in china. and i think good things are ting to happen. >> reporter: as f chinese, the finance ministry says it has, quot f goodth in these two days of talks, which are more of a technical meeting of senior officials. deputy u.s. trade representative effrey garrish is leading the delegation. there are folks from treasury, agriculture, energy and state. one goodsign, the chinese vice premier joined theor talks a little bit. the expectation is that he could come to washington to mht w treasury secretary steven mnuchin and robert lighthizer if all goes well. today wilbur ross defended the administration's stance. he said china has rlized how dependent it is on the u.s. economy.

>> what will come out of it is a resolution, are we going to go the negotiated route or are we going to go in the original rection of higher tariffs. it's really a binary set of decisions. >> reporter: there was also a report that president trump could meet with china's vice esident at the world economic forum in but the white house is not confirming trump's schedule of meetings just yet. we do know that trump will be there. the chinese will be there. we'll see if the two sides will sit down and talk. for b"nightlyiness report," i'm ylan mui. oil prices are b creepingk towards $50 a barrel. saudi arabia plans to make shoe cuts to its crude exports in n effort to push prices higher. lift have gotten a between the easing of trade and economic concerns so domestic crude settled up today about 1%. eli lilly is pushing further into the cancer drug industry.

the pharmaceutical company is buying loxo oncology for $8 billion in cash making this the second health care deal of the new year. both focused on cancer. lilly's ceo says it will help the company trese the dis globally. >> we'd like to grow our presence in oncology. g we haved set of medicines there, but we'd like to expand that because there's so much exciting science for patients emerging in oncology. so many things to invest in. attracti articularly the kind of problem causing the tumor growth and block it directly. >> loxo soared on the news 66% and eli lilly's shares also rose. our next guest hopeshat this year may be the world of kedicine finally outsmarts cancer. conroy is the ceo of a company called exact sciences. he joins us now from the jpmorgan health care conference going on in san francisco right

now to talk wiabout this.n, keood to see you, thanks for joining us tonight. >> thank u, bill. >> mentioned this on twitter earlier today and a viewer tweeted back and said i've hearing for years that medicine is hoping that they finally have turned the corner oncancer. what makes you think that this year may be the year that you have tsrted cancer? >> well, what we're seeing is the research that we have done with the mayo clinic to be able to detect the tiny changes in dna that can ir sheo the blood, so with a simple blood draw we've shown the ability to detect 95% of liver cancers from th simple blood aw. we are expanding this research across 15 cancers with the mayo clinic. the really excited abo prospects for changing the way cancer is detected and, therefe, treated. >> and you basically gave us

three this that y hope will be achieved this year that will change then dynamics treating cancer. they are new discoveries through industry investment, and you ntioned the fact that companies need to continue investing, craing the cancer code through the liquid biopsy which is company isdoing, and putting the patient first. it's a very dynamic set. putting the patient first is something that i noticed because a lot of patients are not compliant with those tests. >> well, that's right. that's the problem that we wanted to solve with our colo-guard testhich is noninvasive way of accurately screening for colon ccer right the privacy of your own home. and using that same technology whheh empowers patient to take care of their own health. we think that we can change the dynamic, and a lot of other people are t working ons too, which gives us great hope.

we know that cancer is a disease of the dna. if you can detect tha cancer dna in blood, you can really change the way cancer is treated, because early detecti really matters. >> you know, it's not lost on us, kevin, that t companies have already been taken out this year involved in eitr cancer treatment or cancer detection. celgene last thursday, loxo today. this is something your company is involved in. you have market capitalization of about $9 million and you can see where i'm going here. if somebody called you and said iwe are intereste buying your company, what would you say to them? well, i can tell you we've been working on this for the last ten years, and i have never in the last ten years been more excited about the future than now. and so what i would say is we can't wait to keep doing the work that we're doing, especially with our partner at

the mayo clinic. i'd much rather do that from a position of being able to make thecisions and innovate in a way that can help people. that isndur goal it's going to continue to be our goal. >> kevin conroy, the ceof exact sciences, thanks again for joining us tonight. appreciate it. thank you. it is time to take a look at some of today's upgrades and downgrades. google's parent,al abet, was upgraded from buy to hold. the dominant digital ad businesd ay it is better managed that facebook. the price target -- general motors was upgraded to outperform to market perform. the analyst expects improved profitability and higher free cash flow. the price target is $41. the stock gained 3% to $34.36. micron technology was

upgraded. e stock has likely bottomed after a 35% declinever t past six months. price target now is $50. shares rose about 4% today to $34 even. altrua was downgraded. the analyst sees tumultuous times in tobacco and is forecasting further problems. that stock fell 3% to $48.. still ahead, why an ugly stock market could be bad news for the financeof the nation's largest economy,

the economic tensions tween the u.s. and china have not exactly stopped tesla from breaking groundn a new factory shanghai. the car maker is forging ahead with plans to ramp up production in that critical chinese car market. here's more for us from . >> reporter: elon musk described the new giga factory as just another example ofmmitment to ta the tesla founder was here insl shanghai to attend a ground-breaking ceremony for their plant which is about a two-hour drive from here. in tweets before the event, musk said the company aimed to fish construction this summer and start model 3 production by the end of the yr a reach high volume production next year. he added that it would focus on the model 3 and the y serving the greatest china region. this factory will produce affordable versions of thmo ls for greater china while the rest and higher cost versions would be produced in

the u.s. for the worldwide market. company plans to produce approximately 3,000 modelve 3 cles per week here and ramp year. 500,000 vehicles per the announcement comes at an uncertain time in u.s./china relations, when trade tensions are high. but musk says that the move is going to be good for the company because it's going to help reduce some of that risk, reduce some of the expenses and some of the tariffs. meantime toyota is promising to expandof the numbe electric vehicles it plans to sell. but is it moving fast enough to keep pace with tesla, which hhe becomeeader in plug-in cars and suvs. phil lebeauas more on the battle to win over buyers looking to go green. >> reporter: it is a race between toyota,he third largest automaker, and tesla, the world's top builder of eleclaic cars. year in the u.s. tesla easily sold more electric vehies than toyota, which has

just one p model thatlugs in, theprrius ime. it's part of ine priuse jum, hybrid cars that run partially on gasoline. >> more powerful, next generation gas/electric prius. >> reporter: prius' popularity exploded ten years ago making toyota the leader in eco-friendly models. >> so ourtrategy is to continue to utilize and enhance our hybrids, our plug-in hybrid, d then eventually bring in battery electric vehicles as the market grows. >> reporter: but gas/electric hybrid sales aren slowing d because of cheaper gas. meanwhile demand for electric cars is growing, eecially in china, where elon musk has broken ground onnt a new p to build teslas for chinese buyers. >> i don't think there's anyes question is seen as the real leader in pure e vehicles now. whether it's sales numbers or

image and awareness and appeal, i think tesla owns that now. it's going to be hard to wrestle that free from them. >> reporter: toyota is undaunted. it's developing pure electric cars while planning t sales of hybrids. >> we believe right now that the hybrid technology in the short term for '19 and '20 is the best plication for consumers today. >> reporter: it is still early in the race to get more car buyers to plug in. while teslaas clearly the lead, toyota believes it will eventually have the models t needed charge up electric car sales. phil lebeau, "nhtly business report," chicago. an activis investor wants dollar tree to raise its prices. that's where we begin tonight's market focus. starboard value is pushing themt to s selling some items that cost more than $1 in order to raise revenues. dollar tree has famou y kept prices at $1 since it was founded 30go years saur starboard also wants the

company to consider selling d familar, the struggling chain of stores they purchased. dollar tree rose today to $97.96. sage trapeutics oral treatment for postpartum depression has successfulliment the main goa of alate-stage study. the company said that patients in the trial showed a rapid and sustained reduction in depressive symptoms. shares surged 42% on that news today to $139.13. roku reported a big increase in user growth in the fourt quarter. users streamed more than 7 billion hours in the quarter, a 68%ain year over year. that growth sent shares up 25% to $42.18. the new york stock exchange andhe nasdaq could see new competition. morgan stanley, fidelity andl citare among the companies whichng a new exchange, they say will provide a low cost

alternative to the major exchanges. that st shares of intercontinental exchange down 3% and theeasdaq fell m than 2.5%. california's largest utility is repontedlydering bankruptcy protection. pg&e faces what could be crippling liability damages from a number of wildfires. the cse of the fir has not been determined, but an electrical outag occurred around the time and place of california's camp fire and wre it started. shares of pg&e dropped 22% to $18.95. thwell, wit new congress being sworn in, there are new ideas floatingd aroashington these days, especially when it comes to taxes. duringn interviewith anderson cooper on "60 minutes" over the weekend, freshman new york congresswoma alexandria asio-cortez talked about the super rich paying their fair share, invoking an idea from the 1960s. >> onceou get to lik the

tippy tops on your 10 millionth dollar, sometimes you see tax rates as high as 60% or %. that doesn't mean all $10 million are taxed at an extremy high rate but it means that as you climb up this ladder, you should be contributing more. >> the super rich in california have an outsized impact on that state's budget. and when the stock market is latile, so is the revenue into one of the world's biggest economies. aditi roy is in san franci >> reporter: california's wealthiest residents, which include mark zuckerberg, lar ellison, larry page and sergei bryn pay the most in personal taxes. that's because of the state'sog ssive tax system in which the top 1% of taxpayers generate ly half of california's personal income tax revenue. at also means big drops in the stock market can create volatility in the state's revenues, especially since california's wealthiest eysidents make a big chunk of

ns ir mon from capital g and tech company stock options. >> today our economy is larger than allatut fourns in the world. we created -- we've created nearly 3 million jobs and put awayol billions ofrs for a rainy day. >> reporter: it's a chaenge govern gavin newsom who took office today will inherit. while the sta currently has a budget surplus, experts say a turn in the markets could result ein swings in state's budget. former governor jerry brown spoke about thatduolatility ng a budget address last year. >> the difficulty comes when you have property tax that's very stable, the property tax has only gone down once since the great recession, whereas tax has gone down many, many times. that volatility is what we're trying tofix. >> reporter: one way the state is facing that volatility is a $13 billion rainy day fund. one tax expert tellsf us the legislature approves big, new spending programs and if there's

a market downturn, that fund would quickly dry up. in a paper released last year, california's legislative analyst offi they say ialifornia revenues fluctuate in the economy and the stock market more than most other states. the office ees that the dotcom bust of the early 2000s led to $80 billion in losses and a mildsi rec or even deep bear market could result in a $20 billion budget problem. while gavin newsom has indicated he would like to overhaul the tax system, there are a few particulars about how he plans to do it. some worry that any changes would rollhe tax burden onto lower income taxpayers. i'm aditi roy, san francisco. the white house today said that the irs will pay tax refunds during the partialgo rnment shutdown. that has traditionally not been the case. the irs has not yetou aed a start date to the filing season. coming up, price hike.

the happiest place on earth just got a lot more expensive. here's a look at what to watch for tomorrow. president trump will address the nation on immigration and the southern border. ces, the world's biggest aual te show, gets under way as that industry searches for the thing. and the former chairman of nissan, carlos gohn, goes to court in japan where he's accused of underreporting hisco . he's expected to make his first public comments. that's what to watch for on y. tues finally for tonight, if you're planning a trip to disneyland, you may experience a bit of stickeroc the theme park giant is hiking prices once again at its parks.

julia boorstin is in los angeles with a look at what' behind that increase. >> reporter: ahead of the new star wars land opening a disneyland this summer, the theme park is raising prices. effective sunday, the least expensiy tict has jumped to $104. meanwhile tickets for regular demand and peak demand days have increased in price by 10%. annual passes has increased by 8%. parking prices are 25% higher. >> it's not surprising. it sounds me like something that any successful company with a quality productyike dis would be doing in a strong economy. here's clearly been overwhelming demand for the parks in general. very heavy attendance, including at peak hours. pa of the plan is to try to spread the attendance a bit. also rember it's a very strong consumer economy. >> reporter: this price hike comes just a year after disneyland and california adventure increased prices by as much as 18%. buthat didn't hurt the parks,

with both visitor volume and spending increasing. now these price hikes are part of disney's preparation for a surge of visitors for star wars galaxy e are 14 acre-$1 billion expansion of the theme p including two rides. bob iger spoke about expectations in disney's earnings call. >> clearly it's the biggest thing we've done since it opened in 1955in and we it will drive a huge increase in demand. i think we'll have some interesting challenges o our hands to manage that demand but that's a good problem to have. >> and they are confident consumers will be willing to pay more. lot oill anticipate a people showing up to this new attraction at star wars land and expect people will accept the price increase because they want to see that product. it's just another way of propagating the circl of popular content through various different channels. >> the risk is if consumer

spenng slows, if the economy strug strugg or if star wars land fails to live up to expectations. we'll see how much it's worth to inns. i'm julia boorstios angeles. here's a final look at the numbers on wall street today. the dow rose 98 points, the nasdaq added 84,&phe00 was up 17. is "nightly business report" for tonight. i'm sue herera, thanks for joining us. >> i'm bill griffeth. have a great evening. we'll see you tomorr

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