>> announcer: this is "nightly business report" with bill griffeth and sue herera. >> blue chi earnings, results from some of the world's biggest companies lift the market and put the focus on a traditionally defensive sector, consumer staples. pay dpgap. the labor department takes aim at oracle,us ag that company of underpaying women and minorities by hundreds of millions ofdollars. unconventional mortgages, they're reminiscent of the housing crisis, and now they're making a com those storiesnd much more tonight on "nightly business report" for this wednesda good evening, everyone, and welcome. it was all aboutto earnings y. a batch of strong results from some of the world's biggest blue chips helped stabilize the market even after a downwar

blip midday. ibm led the way with a nearly 9% gain following its solid quarter we told you about last night. the focus on america's bottom line is a reminder that earnings still matter, a lot. even as concerns overba a g economic slowdown mount. and with the partial government shutdown liming the release of some economic reports, there's even more scrutiny being place on what corporate america says about the economic environment. and with that, the dow jones industrial average rose 171 po ts to24,575. the nasdaq and the s&p 500 both added 5. and soe start tonight with results from procter & gamble.on themer products company reported habetter-tn-expected earnings and sales and raised its outlook for the whole year. that sent the stock higher by more than 4.5%. seema modyas more on what's going right for the world's largest consumer goods maker. >> procter & gamble's strong earnings report defied wall re

st's expectations and trumped concerns of the consumer pulling back on spending amid a slowdown in the global economy. its sales growth was driven by a wide range of category, from beauty to home care products, which rival kimberly clark did not benefit froms t smaller consumer staples company saw profits fall in the same quarter. the upbeat report card comes amid stiffpetition from new players and high raw material costs. it these challenges that pushed proctor ae last year to raise prices, a move that sparked concerns across wall street. hi'ter prices don seem to have discouraged consumers for now. the maker of head & shoulders shampoo and oil of olay expects organic sales to rise between and 4% in fiscal 2019. what's more is procter & gamblee saw iive growth in china, a country that just reported its slowest pace ofrowth in 28 years. on the conference call with

analysts, chief financial officer john mullerhi said at point the company is not seeing se kness in the chi consumer. >> we do not see slowdown of the consumer in china as witnessed by those results. market growth rates continue to be relatively strong. within china, just like the balance of the business, we have our successes and our challenges. >> though he d reference broader challenges related to political uncertainties to the ongoingrade dispute. >> macro uncertainties stemming from issues like brexit, a crisis of consumer confidence ie and trade and other policy impacts that can impact both the top and bottom line. >> for now, investors remain upbeat on the stock. for "nightly business report," i'm seema mody. that procter & gamble report helped lift the entire sector. the consumer staple loetfd up 1%, making it one of the best performing today. so wha is this telling us about the market and the economy?

jonathan feeney covers the sector at consumer edge research ande joins us now with more on that. . od to see you again, jonathan, welcome ba >> thank you very much. >> the basic question is what are these kind of work type of stocks, these must-have type of stocks for the consumer anyway, what are they g us about the economy? >> they're telling us a couple things. they're telling us they got left behind a little bit in the very strong market rally that punctuated with october 2018. they're telling us that while some things have changed, a lot of things have stayed the same. online, different channels people shopping has made it a little more difficult for these brands, introduced new competition and allowed consumers to maybe see discounts and take advan tge ofm more often, so it's harder for them to get the price they want for their goods, but at the same time, people still love the brand. so it's nice to see. i think is appropriao see a little bit more recognition of that. >> but i'm curious, i mean this

group is traditionally coidered a very defensive group. you go to them when the stock market is going lower or you're worried the economy is going to ow down. yet, as courtney reagan pointed out in her story --r seema mody said it, these companies have pricing power right now. if the economy is slowing down, eshow is it these compaave pricing power? >> well, it's all relative. the pricing power i think may be relative to other sectors that are a little bit more sensitive how great the economy is doing. people need to eat, people need to clean their homes, people need to take out the trash and put on makeup. if these companies can produce great innovations,onsumers will pay for those things, history has shown us. ynow, it's par that but it's also partly the little dip that oils have taken in the fourth quarter of the year have given us a little bitore favorable cost outlook. now i think some of these consumer stapl companies don't need as much pricing to reach the profit targets that they already told us. >> how much of it also has to do

with the fact tha consumere reaching for some sort of a return in an uncertain and volatile stock market? they're looking forreliability. >> no doubt about it. you know, if you think about i' been doi this for 20 years, for most of my career. corporate b,d yiel even treasury yields have been significantly higher than the dividend yields and free cash flowor yields these companies, yet many of these companies' dividends are the same oran betr you can get in bonds right now. and for companies that have shown some resistance to inflation in the past, that would historically be a very very goo deal. >> jonathan feeney with consumer edge research, thank you, jonathan. >> tha. elsewhere, dow component united technologies reported earnings that were well above what wall street analysts were expecting. revenue waslso stronger than estimates. the company's acquisition of defense contractor rockwell collins.

they expect revenue and profit to rise this year overall as it prepares to bre up into three separate parts. it is considered a bellwether for other industrials so analysts probay paiery close attention when the company said its operations in china are performing well and the continuing government shutdown has not had a meaningful impact on its business. shares were up more than 5% in today's session. despite the higher stfinish ks did turn lower for a short time midday as the s transportatitor declined. the group was led lower by fedex and u.p.s. on a report that amazon is trying to undercut its vals' prices just a it rolls out its own delivery service. and just as amazon tries to disrupt and eventually the shipping space, a new survey illustrates its power over the retail sector. courheey reagan as details. >> retailers and brands a wrestling with whether or not amazon is a friend or a foe. executives a leaning towards

working were rather than against amazon in coming years. this business helthird-party merchants sell their goods on am sob. it surveyed 500 business leaders and more than half already sell on amazo n nearly othree-quarters plan sell there in the next five years. new customers is the reason and more than a quarter of amazon traffic are new to their brand. amazon has powerful reach, business leaders have concerns. six in ten say lack of over the brand is the biggest challenge, particularly when selling merchandise to amazon that it then sells to shoppers. counterfeit or unauthorized reselling of products by third-party sellers is still a big concern, even though amazon works to address it. amazon isn't the only online marketplace brands are interested . lling on multiple marketplaces is a growing strategy. selling on ebay is nearly on par with amazon for the brands

surveyed. wall mar is a more different third andjet.com a trailing fourth. just today as an added incentive to sell on its site, azon is working on lowering the cost of delivery for marketplace sellers. "the wall street journal" reportshe online retailer is offering its sellers a service to pick up items to be shipp to shoppers from merchants' warehouses which will cut out extra fees and surcharges carriers likeed and u.p.s. charge. those fees and surcharges can add up to 30% of s cppingts in many cases. for "nightly business report," i'm courtney reagan. the oil market gave up earlier gains today over mic erns about an eco slowdown, which of course would mean softer demand for fuel. analysts say, though, that rising crude output also has beur preg prices. u.s. crude settled around $52 a barrel today. the recent volati market has the attention of the ceo of >>chevron.

he real thing we'd like to see is stability. commodity markets when they're volatile, they make it hard for investors to invest. it's hard on consumers. an soou really need to price it in tot encourage investm and draws in new investment but is not so high that it weighs on the economy. we're probably not far from that kind of a price right now. and analysts also point out that the economic and political turmezl in vla right now could just lead to more volatility in the oil market. president trump todayeportedly threatened to impose sanctions on venezuela oil as soon as this week. the ceo of chevron made those commentsld at the w economic forum, where oil prices and the health of theomlobal econy were top of minding. t as joe kerner ort een reports davos, switzerland, that's not all the business leaders were talking aout. >> todthe world economic forum we heard from business leaders about thnology and

privacy, economic growth, the role of the fed and the health of the consumer. we spoke to jamie dimon, the ceo ofjp rgan. >> 3.5% global growth. the united states is doing fine. trade mayetresolved. all those things may rsersverse. we're going to have a recession some day, but we don't know when it will be. the financial system is in far better shape in the united states. >> michael dell of dell technologies discussed the importance of artificial intelligence. >> we're in a world where thedi tal transformation, the explosion in data, ai, machine learning, cloud, 5g, all those things are capturing the and nation of customers, they require all kinds of new capabilities to be able to make that happen. we've put ourselves in the potion of combining the world's best capabilities to be able to enaore that 99% of the fortune 500 and hundreds of thousands of millions of small an medium-sized businesses all over the world.

>> and carlos, head of the world's largest brewer is looking f growth from beer drinkers all over the world. >> beer has gone through an amazing last ten years, amazing assortmentidening in terms of styles, varieties. the mate market has really clicked to it. so it's true that on average beer is not growing volumewise but it's growing ratewise. pele may more for their beers. >> for "nightly business report," i'm joe kernen in das, switzerland. and back here in the u.s., the chair of the white house council ofconomicdvisers repeated a forecast we've heard before, namely that the u.s. could be zero in the enrst quarter if the government does not re soon. during an interview, kevin hasset added that second quarter growth could be humongous to use his term if the government opens before then. somewhere between 4% and 5%.

first quarter growth does tend to be notably weaker than other quarters in the year. the partial shutdown is now in its 33rd day. it is time to take a look at some of today's upgrades and dow component walmart was upgraded to overweight from equal weight at morgan stanley. the analyst says walmart's u.s. operions can generate sales growth without sacrificing margins. the price target is $110. walmart shares r to $98.71.n 1% pfizer was odowngraded neutral from buy at ubs. the analyst cites the pendi loss of patent protection on some drugs. the price target is $46. the shares fell a fraction to $42.16. nd fellow dow component merck was downgraded to mart perform from outperform at bemo capital markets. the analyst cited the drug maker's overreliance oner its carug keruda. the price target,$80. and lowe's was downgraded to

hold from buy at loop capital the firm is less optimistic about the home improvement retailer's margins right now, so the price target is now $99. nonetheless, the stock rose slightly to $91.83. still ahead, the bright spot in ford's quarterly results. united health care is suing the new amazon, jpmorgan chase berkshire venture. the insurer alleges the group poached an employee and took trade secrets. the suitlaims that the employee now poses a direct threat to united health optum unit. north america was a bright

spot for ford of the automaker reported earnings today that missed expectations by 2 cents but that was not exactly a surprise, since the company had already oupreaed those results. revenue, though, was better than expected at more than $38 billion. reaction in initial after-hours trading tonight was mixed. phil lebeau has the one key takeaway for investors tonight. >> when you look at the fourth quarter for ford, it's all about northmerica and t rest of the world. the rest of the world is in trouble for ford. it lost a combined$780 million when you look at europe, china, asia, as well as south america. all markets where thes company i struggling to restructure its business. meanwhile in north america,he t company made $2 billion in the fourth quarter. for ceo jim hackett, when he talks with analysts, the key thing everyone will be focused on, what wil happen in 2019. the company says that it is moving forward with its

restructuring, but wall street would like to hear more specifics, unclear when that will be happening. phil lebeau, "nightly business report," ft. worth, tebs. broadband growth drives comcast's quarter and that's where we begin tonight's market focus. the company say its nbc universal media unit and its high-speed internet businows fueled . it did, however, lose cable customers but that didn't stop comcast from raising its quarterly dividend 10%. shares were up 5. to $36.89. comcast is the parent company of nbc, which produces this broadcast. verizon's media group is reportedly laying off 7% of jobs in the division previously called oath. the group is madep of inrizon's media properties like yahoo! and the huon post as well as advertising and technology. in division was created november to bring oath under the verizon brand. oath was the result of the merger between aol and yahoo!. verizon shares were up nearly

1.5% at $57.76. johnson & johnson is reportedly looking to buy a surgical robots company called aris health.ac rding to bloomberg, a final deal has not been reached and there is no certainty that talks will lead to a sale. j & j was unchanged at $128.80. walgreens boots alliance is going pay $269 million to settle iva number of fraud lawsuits. the company had been accused of overbieaing federalh programs for over a decade. according to thisettlement agreement, walgreens says, quote, it admits, ackwledges and accepts responsibility for the conduct alleged by the feral government shares of the company were up about 12 cents today to $71.71. texas instruments today topped wall street profit forecasts, but they missed on revee. analysts have been concerned about slo ng smartphonsales. ti does supply touch screen orcontrollers for chips things like iphones andit paipads.

the stock was volatile in the initial after-hours trading. it fell 1% in the regular session. one of the biggest software companies in the world now has a big target on its back. the labor department is accusing the company,or le, of discriminating against women and minority employees and them more than $400 million in lost wages. josh lipton has the detailsm f san francisco. >> the new federal filing comes two years after the government first filed suit against oracle for hiring discrimination. now it's amending that complaint, bringing new evidence that it says clarifies the sco of the company's bias. the government says the company's methods of discrimination include steering these employees into lower-paid jobs. oracle's suppression of pay for its nonwhenite, nonmale empyees o extreme that it persists

and gets worse over long careers, the govnment says. the complaint says this impacted more than 5,000 women and 11,000 asians. oracle discriminated in college recruiting as well. out of 500 hires thatcl o made between 2013 and 2016 for certain technical positions, only 6 were african-american. oracle fired right back calling this lawsuit meritless. we fiercely disagree with the spurious claims and will continue in the pcess to prove them false. we are in compliance with our regulatory obligations, committed to equality a pud of our employees. but concerns about bias i silicon valley extend well beyond just oracle. when thousands of google employees walked out of work in protest last fall, pay disparity was a concern they highlighted. and uberade headlines when reports surfaced over the summer that it faced a federal

investigation of its own over alleged gender discrimination. those who study this issue say continues to be a big problem thoughtech industry, some tech companies appear to be making progress. just this week, intel announced what it called a major milestone, achieving gender pay equity across its global workforce. though the chip giant alsoow acdged that it has more work to do, noting its lower wpresentation ofen in senior roles. for "nightly business report," i'm josh lipto. and coming up, renewed risk, demand for traditional hse loans down, while more exotic type loans gains steam.

we have two auto recalls to tell you about tonight. in one, volvo is recalling more than 200,000 vehicles to fix a fuel leak. the autaker says an engineering problem could potentially cause fuel to leak into the engine compartment over time. there have been no reports, though, of injuries or damages as a result. separately, subaru has temporarily shut two o its factories in japan to fix a power steering defect. thos two plantsre responsible for two-thirds of that company's global production and many of those cars were united states, which is subaru's biggest market. demand fortg mes cooled after two weeks of sizeable gains. the mortgage bankers association reports a 2.7% decline from th prioweek, as interest rates ticked higher. refinances, which are high leer e ly -- highly sensitive.

the 1 and while demand for traditional mortgages may be cooling, "the wall street journal" reports that unesnventional mortgre making a comeback. ben eisenhe wrote story for "the journal" and joins us to talk morebout is. ben, thanks for joining us tonight. >> hi, good to be here. >> i know we're not talk about ose liar loans that got us into trouble ten years ago where there was virtually no documentation. how are th different this time around? i>> this an evolution of the liar loan, it's not exactly the same thing. what y're seeing is much like those loans before the crisis, these are people who can'te prov traditional documentation of their income to get aloan, so instead what you're seeing is untraditional ways of providing that documentation, whether that's bank statements or assets or anything elsef that's sorte way that they're qualifying to get a

loan. while it doesn't look exactly as risky a liar loan, it's sort of shared some ofhose common characteristics. >> how much growth have we seen in this particular niche markets >> i important to note that this is a very small market. this is less than 3% of all originations over the first three-quarters of last year. but notably it's grown about 24%, 25%, and that's during a time when you've seen sort of conformingni fmae/freddie mac mortgages start to decline. so it's really t only mortgage category that's been growing over the last little bit. >> but you did cite a survey, because as rates rise nd homes are less affordable, it's a tough market out there right now. so companies are looking for ways to incvease e, and you cited a survey that said mortgage originators aot of them may get into them, is that right? >> this is seenwts a g area because this is a market that's been undeerved over the last

post-crisis period. you're seeing these l tderst have kind of stayed away from a lot of those borrowers considered a bitiskier and are starting to turn to them and saying we might give you a mortgage if you provide this many months of your bank statements and have a certain fico score and put this percent down. so they'retarting to have a little bit more flexibility than they did. >> what do the regulatorof thin this? have they weighed in yet? >> the regulators have been looking at it, and what you've seen is you've seen the occ otually mention one type loan. this is called an asset depletion loan where you basically use assets as a way of deriving a stand-in figure for income. they have noted that there have been some things that they have ng a little bit worrisome in underwriting stthdards. g particularly alarming, but it looks like they're watching it closely. >> and we will too. we're glad you are to ben eisen, thanks for joining us

tonight. >> thank you. >>te a real es record was set today. a new york city penthouse on central park south has sold for roughly $238million, making this the highest priced home sa in the u.s. according to "the wall street journal" the buyer is ken griffin, who also recently purchased several floors of a chicago condo, a penthouse in miami beach an a home in london, which was one of the priciest deals ever done in that city. and fally tonight, a peek into the future. boeing this morning unveiled a prototype of an air taxi that it has been developing for uber. it a battery-powered aircraft that has a range of up to 50 s, mind it does not require a pilot. that's icorrect,is autonomous. right now it's unclear when demand for this type of transportation will become widely available. uber doesope to have a flying car network called uber air up

and running by 2023. can you say the jetsons? >> exactly. all right. before we here's a look at the final numbers on wall street today. the dow ros 171 points. the nasdaq and the s&p 500 both added 5. you won't get me in one of those. >> you first,o ahead. >> that will do it for us tonight. i'm sue herera. thanks so much for joining us. >> i'mgr bill feth. have a great evening. we'll see you

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