>> announcer: this is "nightly business repor with sue herera and bill griffin. wall street cheers. lawmakers reach a tentative deal on border security that would avert government shutdown, and stocks take off. financial hardship. not all parts of the country are experiencing an economic boom. and today the fed chair went to a town in mississippi where even atms are relatively new. time is money, and all ofth time you spend sitting in traffic is costing the economy tens of billions of dolls. those stories and more tonight on "nightly business report" for tuesday, february 12th. >> good evening, everyone, and welcome. all street was in rally mode, extending the strong gains the market has seen this year.

investor sentiment was lifted by the two issues we've been reporting on -- optimism on trade and talks in washington ta avert government shutdown. when reports first surfaced that a tentative agreementad been reached, stocks took off and never looked back. the dow jones industrial average rose 372nt p to 25,425. the nasdaq added 106 and the s&p 500 was up 34. seema mody was in the o middlef all the action at the new york stock exchange. >> reporter: encouraging headlines from washington fueling a big rallyalnl street. first, stocks jumping on uews that. lawmakers had secured a tentative deal on border securityfunding, which could prevent another partial government shutdown due to begin saturday. markets keeping close eye on trade developments out of beijing, where a u.s. delegation is continuing talks with china this week in hopes of reaching a trade deal before the march 1st deadline. optimism pushing china-related names like caterpillar, deere wd boeing higher by around 2%.

the question ither the rally can last, and a lot of that will depend on the commentary from beijing later this week. for "nightly business report," seema mody, the new york stock exchange. boy, just 24ours ag it appeared lawmakers were still far apart from reaching a deal to prevent the government from shutting downagain, but 2 hours later, there's a tentative agreement in place, but questions still remain. >> reporter: capitol hill racing against the clock to finalize a deal to fund the government. lawmakers have reached a deal in principle that includes compromises on two key priorities. on border funding, he deal includes almost $1.4 billion for physical barriers, less than what trued had a for but more than what democrats initially offered. onmi ation, democrats backed off their demand to cap the number of detention beds for illegal immigrants captured inside the u.s., but the total number of beds would be reduced. today, republican leadership call it a bipartisan,

bicameral agreement that includes a down payment on the president's priorities. >> first of all, i hope he sign. the bi and second, i think he ought to feel free to use whatever tools legally use to enhance his effort to secur theborder. so, no, i would not be troubled by that. >> reporter: but it remained unclear if the president would sign this deal. eaking with reporters today, trump said he wasn't comfortable withrohis cose. >> it's always nice to negotiate a little bit, so you know, atever you t. but i would hope that there won't be a shutdown. i am extremely unhappy with what the democrats have given us. it's sad. it's sad. they're doing the country no tivor. they are h our country very badly. to we certainly don't want see a shutdown. >> reporter: conservatives have come out against this. senator lindsey graham says he needs to see more detail on hmigration. thse freedom caucus says this isn't a serious effort to secure the bordbu. with just days to go before friday's deadlin law mmakers

from both parties are urging the president to get behind this agreement because there is no plan "b." r "nightly business report," i'm elan muey in pshington. >>sident trump also commented on the trade negotiations between the u.s. and chin saying there may be some flexibility the self-imposed march 1st deadline if the two countries are close to a deal. as of now, if no deal is reached, march 1st is the date that additional tariffs will be put on chinese imports to the u.s. and while there is some optimism, there are also obstacths ahead o high-stakes talks this week. eu is in beijing. >> reporter: the tusgr's rober lighthizer has arrived in beijing to join the ongoing trade talks. both sides officially remain optimistic. the chinese foreign ministry made a statement yesterday that china hoped for a good result, source who's a familiar with the negotiators on the chinese side, and he painted atu p of frustration among

the negotiators. there's a feeling that the negotiations are about the u.s. making demands on china but not getting anything in return. for instance, he said the americans had been unwilling to budge on restrictions high-tech exports to china, which the chinese believe can reduce the trade deficit and has been a longstanding complaint by beijing. generally,here's a sense that the americans are being very harsh and not giving the chinese faith. and it appears to them sometimes that certain negotiators want to push the chinese to the point that talks soil. his afternoon, we got a rather testy response from the chinese government abo what they see as a continued u.s. campaign against huawei. secretary of state mikepe p is in central europe and has cautioned u.s. allies ainst using huawei equipment on their soil. the chinese foreign ministry respondedgtoday, say the u.s. has threatened and provoked relations between china and c othentries and discredited the legitimate development and operation of chinese companies. the actions of the united states

are neither fair nor moral. this highlights how difficult theegotiations are between the u.s. and china. for "nightly business report," i'm eunice yoon in beijing. back he in the s., oil prices rose along with stocks today after saudi arabia said it now plans to reduce oil production in march. the crudearket is brushing off concerns, at least for today that world oil demand could decline because of slowing global growth.do stic crude sits around $53 a barrel right now. ub senator marco is the latest politician to target stock repurchase programs. the plan would taxuybacks as dividends, which are subject to a wide range of rates. buybacks are cly taxed at the lower capital gains rate. plan nator expects the would likely result in fewer compies pursuing buybacks a instead would encourage more capital investment. just yesterday, as we, report hedge fund manager paul tudor jones called buybacks a mia and said companies should focus more on what he calls ethical

investing. >> i think we've got a mania going on in buybacks and a mania going on in terms o shareholder premisy. it wast always thisway, right? if we just go back to when i was a youngster, corporate pay, ceos made 20 times that of the average line worker. so, things have been different and can be different n.ag and if they're not, i'm really nervous about what the ultimate social consequences are in this country. i i don't know iant to see a legislativeme out for this. i'd love to see this happen srganically. >> well, joining now to talk about the impact that limiting stock buybacks would have on thk s, eric marshall joins us tonight. he's portfolio manager with the hodges funds. eric, welcome back. good to see you.>> good to be here. >> politics aside, what impact do you think limiting buybacks would have on the stock market?

let me a it a different way. what impact do buybacks have on stock market performance, do you think? >> well, we see buybacks is actually a healthy mechani t keep capital markets efficient. oftentimes, if a company has excess capital andon they have opportunities to reinvest that capital in projects that earn high returns above their t cost capital, sometimes the best thing to do is to return thatapital tohe shareholders through buybacks from the capital markets so that capital can be reinvested maybe in smaller cpanies who need that capital to grow their businesses and take advantage of higher return projects. so, wectually think buybacks actuallykeeep the m efficient, which ends up creating economic growth in jds benefits all of society. >> what happens as the stock market conties to move higher,

eric, to the thought by companies that t dy want to more buybacks, or do they do less buybacks in a strong ma >> well, that's a good poin if we have a situation where as the market goes up, the cost of capital becomes -- ofpiquity l becomes less expensive. then it doesn't make as much sense to continue t buy bac stock. but i think over the recent phenomenon of a these companies buying back stock in recent years, it's really been a function of highearnings yield on stocks relative to really low interest rates. >> right. >> as lg as we're in that environment, it makes sense in a lot of cases for companies to return extra capital to the shareholdershrough these buybacks so that they can be reinvested elsewhere. >> by th token, while we are still in a relatively low interest rate environment, there are those who that that capital that they use to buy back their shares could also be

used to build factories and crbste even more in other words, it's a better use of the capital than just buying their share back. what do you think? >> well, that's a good point. not all buybackrograms a created equal. if a company can earn a return on capital by reinvesting in their business, as a shareholder, you'd want them to do that, because that's going to create even greater value in the future. but if they're going to invest in subpar opportunities in a stagnant business, oftentimes the best thing do is put that money back into the capital markets and let other companies that may be smaller, may be more innovative, that maybe nee capital reinvest it in other places in the economy that are growing faster. >> eric marshall with the funds.s again, thanks for joining us tonight. >> thank you. time to take a look at some of today's upgrades and downgrades. cisco was downgraded to equal

weight by morgan stanley, citing slowing growth in one of their s busi cisco reports earnings tomorrow. their shares rose a fraction to $47.89. take two was downgraded to underperform from market perform ateamo capital markets. the analyst cites a decline in buzz around one of its most popular video games. the price target is $80. the stock fell about 4.5% to $89.25. gilead sciences was downgraded t market perform from outperform at wells fargo. the analyst cited a lack of growth catalyst following a recent drug trial failure for the company. price target now is $68. that stock fell tay to $65.40. and surgical equipmentmaker nuvasive was downgraded to hold from buy at jefferies. the analyst there says he's skeptical of the reports that smith and nephew is ready to make an offer for nuvasive, and even if it does, the analy thinks a bid above $60 a share

is not likely, and so the firm cut its pri target to $60, but the stock still rose on that takeover chatter.p it was 3.5% today to 8.. there are a record number of job openings. the labor department today reported 7.3 million opens, positihich is the most since the government started tracking that data in december of 2000. economists say the report shows that employers expecan d to remain strong. the number of job openings is also much greater thannuhe er of unemployed, which totaled 6.3ilon last month. and while the labor market remains strong, economic growth is still uneven. that's especially the in the mississippi delta and other low-income parts ontthe c where many residents still don't even have a bank account and wher atms are relatively recent arrivals. fed chair jere powell traveled address egion today to that very issue. steve liesman has the story for us tonight from moorehead,

mississippi. >> reporter:rwo fires in th homes in the mississippi delta left thara appleberry and her two girls in destitute and in bankruptcy. >> we have to pray. we prayed in unison because i didn't wanto lose another home. and one of my gls said, mama, it's going to be all right. god got us, that t this shall pass. >> reporter: and along, literally, came hope, a credit unionocused on economically distressed areas in the south that brings basic bankingrv es to the nation's poorest. >> the rate of poverty here is three times what you see inti t as a whole, even greater for the region's afriren-american dents. if you look at level of banking servic, three times the level of people who don't have a banking account. and when you add the number of people who use check cashers and pay their lenders, almost between 60% and 70% of the members who joined our credit union were outside the banking synem or the edge of the financial system, paying high

ras or did not have basic tools to support their families andtabilize their financial lives. >> reporter: you can see the assets of banking services in poor towns like thishroughout the mississippi delta. nationally, one in four amicans is known to be unbanked or underbanked, meaning they don't have access to basic bankin some live in banking deserts where there aren't banks f some people don't trust banks d some peopl think they're too poor to open an account. but there is more focus on the issue. fed chairman jerome powell made a hisric trip to t delta, speaking to students and attending a conference along with i aestment bankers community activists to shine a national spotlight on the problem of the unbanked. >> access to safe and affordable financial services is vital, especially among famies with limited wealth, whether they're looking to invest in education, star business, or simply manage the ups and downs of life. >> reporter: access to banking is such a problem down here that it was only in 2015 that hope opened the town's first bank

atm. >> when hope camein, that was first thing they did. a hole in the wall and put an atm machine there. there was very little business th you cou find up here, more head at that branch. >> reporter: for appleberry, the financial counseling from hope means she suld be out of bankruptcy by november. >> once i get out of bankruptcy, i know that it may not be the ttest account, but i'm looking to have enough money in hope th a if i have dry day, me and my girls will still make it. >> yes. >> so, i have to learn to stay small to get to inbig. c up, did you know all that time you sit in traffic isn't only taking a toll on you, but taking a bite out of the economy? have more on that a little

it has been a tough stretch for some of e video game makers recently, and it's been no different for activision blizzard, which late today reported revenue tha missed estimates. the company issued weak guidance as well and said it plans to cut 8% of its workforce. activision earned $1.29, a penny better than expectations, but it was the revenue of $2.8 billi that was considered disappointing, and so was the outlook that it provided for the first half of the year, and that sent the stock initially lower after-hours trading tonight. josh lipton has more on activision's results. >> reporter: $6.3 billion, that was one number in activision's report referring to netbookings. that's the measure of both digital and physical gamesales. oppenheimer's andrew ersaitz that's important because that metric captures all revenue the company's generating, and it was down $1 billion year over year. o on tther hand, he notes a potential positive, saying the company is increasing head count

in development to aelerate the pace of new content from its leading franchises. but others at activision will be losing their jobs. the company did announce a workrce reduction of 8% from its total workforce of 9,800 employees. for "nightly business report," i'm,osh lipt san francisco. rm under aour powers past estimates. that's whe we begintonight's "market focus." the sports apparel retailer repoaned better-xpected earnings and revenue, thanks to strong sales and growth overseas.ts analay the company was able to cut excess inventory ana ge excitement around new product launches, and that helped send the stock up nearly 7% to $22.21. quarterly profits topped expectations atnternational brewer molson coors, but sales cll due to weak demand in the u.s. andada and rising transportation and aluminum costs. molson, which coors and blue moon beer, is also restating two years o financial results after finding accounting errors. sales plunged to $59.19.

>>y private equ firm toma bravo is buying software company ellie may. shareholders will receive $99 in cash for each share that they own, a 21% premium over yesterday's clo price. today, ellie may surged thatmu , up 21% at $98.95. and here's another private gsuity play. jab hold says that it plans to raise its stake in cosmetics conglomerate cody from 40% to 60%, a bump of nearly $2 billion in shares of cody, include covergirl and sally hance yso hanson. stock rose to $10.87. and a group of democratic senators is urging the justice partment and thefcc to reject the proposed merger bween rint and t-mobile. the senators say that the $26 aillion combination would prices for consumers and stifle. competit a house panel is set to hold a

hearing on this deal tomorrow. sprint rose a 3% today to $6.14, while t-mobile added more than 1.5% to $69.60. a new report from analytics company inrix found that americans snd a lot of time and money sitting in traffic every day. according to the data, american drivers lose about 97 hours a ye t sitting in traffic andt congestion costs the economy nearly $87 billion in 2018. trevor reid transportation analyst at that company joins us to talk more about the nice to have you with us, trevor. welcome. >> thank you for having me. >> and you collected this data from all of these new connected cars that we're all driving in correct? >> yeah, and we collected it from a lot of traditional sources, too, so gps, cell data, street coils, traffic came . you name it, we probably collecm something fit. >> clearly, sitting in a car for hours a day is not being

productive. there things cities can do? i know some cities have staggered starting times fie comp so that you're not all rushing to get to town by 8:00 or 9:00 in the morning. what else can cits do toelp companies? >> there's a lot of different ways. one o them that's been very popular in seattle is promoting the use of public transit amongst employers into the most dense portions of the city. and youknow, for every car you're able to get offin the ro he most dense part of the city, it really pays big benefits as far as reducing >> now, you ranked some of these cities. ston, washington, d.c., and where you are, seattle, they did t fair well in this particular study, but i'm struck by the fact that boston and washington, d.c., are very old cities, so do they need to commit more to infrastructure and that other typef transportationhat you just mentioned in order to maybe try and reverse this or at least

mitigate some of the >> yeah. so, i'm really glad you brought up the age of the cities, becaus what we found in our study is that age is the best predictor of congestion in a city. and when you think about itma i s a lot of sense, because a developed oston, it around walking, horses, even in the oldest parts of the city. and so, it's really ill suited to using an automobile, which is 20th-century technology in a 17th-century,6th-century city. so, especially in these old cities, the discussion should be much more about how do we use these streets most efficiently to serve these very dense populations. >> okay. and on that note, trer rei with inrix, thanks so much for joining us tonight. by the way, california's governor is abandoning that state's $77 billion high-spe rail plan to connect los angeles and san francisco. according to the "associated press," cost was cited as the reason. during his state of the state,

governor gavin newsom also proposed a digital dividend that would allow consumers to share in the profiade by the tech firms in that state. d did not have details on how theidend would work, but he did say something bold has to be done. coming up, the got off to a slow start this ar, but just wait. amazon and general motors are reportedlyn talks t invest in electric carmaker ryvan, which spetralizes in el pickup trucks and could be a tesla rival. according to reuters, the investmant would given and gm minority stakes in the start-up and would val ryvan between $1 billion and $2

billion. reuters add that theeal isn't final, it could fall through. nissan has cut its forecas for its profit and vehicle sales. it also took an $84 million charge related d toerred compensation it says was pr to former chairman carlos ghosn. as you know, tokyo prosecutors have charged mr. os with underreporting his pay. the out your maker said that it's facing a decline in global vehicle sales, especially in the it will in europe, and reconsider its plan to deepen its alliance with france's renault. everybody loves buying something on sale, of course, but according to a new all of those markdowns cost retailers $300 billion in revenue last year. that equals about 12% of sales.p thist does not include gr well,e are just a few weeks in to 2019, but already it's apparent that the year is not starting the way hollywood would li but are things about to sdmange julia boorstin takes a look at the box office

challenges and why things may be about to heat . >> reporter: "the lego movie 2: the second part" has failed to turn around a struggling2019 x office. it grossed $34 mlion at the domestic box office, as much as $20 million less than some estimates forhe film. wa disappointingkend bringing the year-to-date u.s. box office down 14.5% from last year, which is bolsted by a"star wars" film, and this winter, films such as "bird on netflix have been making headlines and drawing attention. >> the bar isin dely higher in terms of getting people to go m the movie theater because there's soh compelling content at home on the small screenom so now it down to the marketing, the strength of that marketing ter movies in th those big tent pole films, the excitieing marve movies, the horror movies. all those big franchises are going to be the films that get people off their couch and into the movie theater. >> one issue -- once people stop going to the movies and get used to streaming movies on netflix ,

insthat means they stop seeing trailers and getting those reminders about why to come back. a box office decline can start a vicious cycle. analysts warning rsfiquarter box office revenue could fall further on tough comparisons to st year's blockbuster "black panther," but disney's "captaina el" coming on march 8th sh to turn things around. >> comparisons a up until "captainmarvel," which thankfully is required viewing for "avengers e game," which will kick off at the end of april. sooo the news is help is on the way. the bad news is it's going to take a little while to get but it's coming. >> expected to bolster the box office, a slew of sequels in the works, such a marvel "avengers: end game," "godzilla: king of the nsters," "toy story 4" and "far from home.", plisney is debuting three live-action remakes of popular family films, dumbo, alladin and

the lion king, brands big enough to cut through the clutter and likely get crowds back to theaters. but there's no question with so much content streaming atho , consumers need more reasons to pay up for the more expensive trip to the theater. for "nightly business report," i'm julia boorstin in los angeles. >> here's a look athe final numbers from wall street today. the dow rose 372 points.da the n added 106. s&p 500 was up 34. that does it for us tonight. i'm sue anherera. for joining us. >> i'm bill griffeth. have a great evening. see you to

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