>> announcer: this is "nightly business report" with sue herera and bill griffeth. data discnenect. economic reports show strength while others show weakness, and that is making it difficult to figure out whether a recession is up ahead. putting patience before profits.er lawm say drug companies are failing o that, prompting big pharma ceos to defend their practices. major expansion. jeep sales are red hot and now fiat chrysler is making a investment in detroit. those stories and more tonight on "nightl tuesda.s report" for good evening, everyone, and welcome. bill griffeth is off tonight. it was a busy tuesday that saw the fed chairman on capitol hill. drug ceos wer a there too the

president arrived in hanoi for a summit. we begin with theconomy. today a number of reports pained a somewhat confusing picture. consumer confidence rebounded february and building permits, a sign of things to come, were higher. that's the good news. but housing starts, a report delayed becausedof the sh, tumbled to their lowest level in than two year p homeces decelerated in december, according to the home price index. and thenome depot reported earnings that missed expectations, and that sent t stock lower in trading today. courtney reagan takes a closer look at the dow components' numbers and what they may b saying about housing and the economy. >> home depot just finished its best year ever but the home improvement retailer's final quarter disappointed. the ceo said unfavorablehe weatr, cold, snowy andcoet itions is the reason for the lower-than-expected sales. when it's wet eoutside h

improvement projects get delayed. the categories that are less weather dependent performed better. >> home depotat is a g company. in the last few years they powered through when you see a company that's missing and they're starting to call out weath and rain is the first that's been called out for quite some time, that expresses someeakness in the underlying trends. the number of transactions and the amount each shopper spent both grew in the quarter. sales to professionals like contractors continued to outpace sales to do-it-yourselfers. home depot's online sales grew 23% in the qrter and half of online purchases are picked up en stores. the sh of the housing market remains a key driver of home improvement spen the chief financial officer says most housing metrics are trending positive notinghat home equity has more than doubled since 2011 in the u.s.n and more t half of u.s. homes are more than 40 years old,

requiring improvements, a bullish indicator for home depot. altogether, home depot executives classify the u.s. housing market as stable, and forecast comparable sales t grow5% this year. >> there's so much concern out there right now with what we've seen weaker housing data, maybe a weaker consumer. i don't see that in these home depot results. >> they're probably the best retailer in the coury and probably one of the best operators in general. to me it's very clear, it's signs the housing market are startingo slow. >> analysts agree it's an well retailer but if the housing market starts to weaken, even the strong home improvement players will get hurt. for "nightly business report," n'm courtney reagan. the chairf the federal reserve, jerome powell, addressed some of t conflicting economic data when he delivered hisia sual testimony on the economy. he told lawmakers that the central bank is prepared to stay the course. r stn has more. >> fed chairman jerome powell or day one o his congressional testimony offering a mild

outlook on monetary picy and interest rate hikes. he didn't close the door on another rate hike this year but emphasized the fed will wait and see. >> the committee has decided that with our policy rate in the range of neutral with muted inflationressures and some of the downside risks that we've talked about, this is a goodo time patient and watch and wait and see how the situation tvolves. >> if sounds like he said that before, it's because he had. powell stuck veryly clo to the words from the january fed meeting and his press conference. the fed m at thatting pivoted to patience. powell offered an optimistic view on the u.s. economy but said headwinds both foreign and domestic clouded the outlook. powell didn't see a threat from the economy running out of workers. >> if there's more slack in the labor market, it's because people are comingack in. if people weren't coming back in, the unemployment be substantially lower but they are or they're staying in.

so labor participation rate is rising and that tells us there is more room to grow. that certainly has implications for monetary policy. >> day two of powell's testimony is tomorrow in front of the that could be a more contentious hearing with several new committee members. investors will get a chance to see just how much support the new house members have for the fed's new policy of patience, or whether they have another polici in . for "nightly business report," i'm steve liesman. ami number of ecos and business surveys say that the odds of asi rec are rising and that it could happen later this year or next, but a couple of hedge fund managers today said tt's not necessarily the case. >> everybody is worried about a recession. i don't think that's happening at all. i do thinkou're goi to have slower growth. what that means is at least for most people, feel that.g to it's not going to feel as if things were as good as they were last year,t's just going to be slower. conditions would normally lead t a big market decline just don't seem to be presenting. conditions that

lead to a big market decline? the stocmarket spells an oncoming recession. recession is in the cards. economic owdown,yes. >> so what do we know about the economy and where it might be headed? we're joined by patrick havanick. welcome back. >> nice to see you, sue. >> housing is a perfect example. you ge starts going one way and home sales the other way. net-net how do you view the economy and conflicting data? >> first off, it's important to remembera really sluggish and uneven recovery for its entire length, for ten years. and we we kind of spoiled a little bit by the summer where a thingsy seemed to be cooking on all cylinders, but the economy ig. slow the debate right now is how much is it slowine and one of problems right now is because of the government shutdown, a lot of the data is either missing or coming out and so we kind of have to fill

in the blanks with speculation. >> so does that mean as an investor you wait fornother month to get a cleaner, if you will, number on thing like home starts or, you know, retail sales or the like? >> so the frustration right now is of course we'd likha t maximum visibility. we don't have all the visibility that we'd like. we never have clear visibility. there's always things can get better, things can get worse. i wou say from an investors point of view that you never really w bt to being your investments in a way that if two months- a monthr two months of either really good numbers or bad numbers come out that would fundamentally change the way that you're investing. we're in the tenth year of a recovery. 75% of economists that were surveyed said sometime over the next few years they expect a recession. you know at some point this cycle will end and you probably

need to be ppared to cover the downside of that. >> do you take the fed out of the equation nowhaecause they said, and the fed chief repeated it today, that they will take aery patient and measured approach to any interest rate increases? is the fed less of a component now? >> so one of the good pieces of news right now in the economy is that inflation has fairly low. and so the fed isn't really under any pressure to rse rates. that was one of the fears in the second half ofea last that caused the market sell-off, that people were afraid the fed would ways rates and push the economy into a recession. it sounds like the fed intends to beie patnt and can afford to be patient. >> you say good news will be good news nnd bads will be bad news. is it as simple as that when you have such murkine in some of these numbers? >> i said that because sometimen in the past w people were afraid that the fed would raise ra as, bad economic number would come out and the market would go up because they'd say, oh, good, the fed will ease or

won't rate hike. now the fedd has s we're not going to raise rates so that mean the economy has to stand on its own. it atrick, we'll leave there. thanks so much. well, on wall street stocks were lower in a choppy trading session as investors weighed home depot's results and the testimony from the chief. the dow jones industrial average was down 33 points to 26,057. the nasdaq fell 5 and the s&p 500 was off 2. pharma stock e wereected to see some turbulence today as a number of high-profile ceos testified in front of a senate committee on the high price o prescription drugs. while there was a lot of harsh questioning, tre was little in the way of what to do about the issue. ylan mui is covering the story for us tonight from waorington. >> rr: everyone wants to know why prescription drugs cost so much, and lawmakers today came out swinging to get some answers. >> is the stock price more important than inventing that

nextle cure? even if you buy the specious argument tha a drug price's list price at launch is driven by research costs, what could justify arbitrary price increases year after year long after the researclo and deent spending is done? >> reporter: the ceos defended their pricing, pointing to the high cost of research and delopment, or what's known as r & d. merck said it invested $10 million in r & d last year and spent a billion on a drug that market.ade it to they tried to shift the blame to the middleman, the fapharmacy benefit managers. they say they're t realeason and urge lawmakers to pursue a solution >> no one company can unilaterally lower list without running into financial and operating disadvantages that make it impossible to do that. but if we all bring the parties together around the table with the goal of doing what's bestr

e patient, i think we can come up with a system that works for all americans. >> reporter: this is just the beginning of the road her on capitol hill. senator clyck gra, the chairman of the committee that held the hearing, said he's not done just yet. >> we're not going to accept finger pointing. i believe that we all know, though, that there's so many people in this process and iere's so little transparency. >> reporter: the a lot of appetite for some sort of gislation on the hil but lawmakers still need to agree on what exactlyt like. ylan mui in washington. the fda today outlined a mber of measures to combat the opioid crisis. the measures iacludeging the pills in small amounts, such as for a day or two following rgery, and reducing the dosage amounts. it is also calling for new steps to promote non-addictive pain medicines. the fda has criticized for not having done enough to stem the

epidemic and even enabling it by approving powerful pain kil rs for widespread use. it is time to loo at some of today's upgrades and downgrades. caterpillar was downgraded from sell to buy a ubs. the analyst cites concerns over slowing global construction demand. the price target is $125. the stock fell more than 2% to $137.98. foot locker was downgraded to hold from buy at pivotal research. the analyst cites tough comparisons in the coming quarters along with the stock's valuation. the price target is $64. the shares fell 1.5% to $58.89. still ahead, why wall street's attention is turning to vietnam.

president trump and the head of north kor arrived in vietnam for an historic second summit. is a geopolitical event t t investors are watching for signs of an easingf nuclear tensions. eamon javers reports tonight from hanoi. >> reporter: it was about 65 th rs of travel time for n korean leader kim jong-un as he made his way here from pyongyang by armored train, about 20 hours of travel time for president trump onir force one. the two leaders sat f their second face-to-face summit here

in hanoi, vietnam.he among questions experts are asking are what possible agre could these two leaders come to. if they can't get to a full deal for denuclearization of north korea, including removal ofll sites and all potential weapons smaller, what are the steps that the two leaders could agree to? oneossibility is formal end to the korean war, which ended with an armistice back in 1953 t not a cessation of the war itself. that is one document that could be signe here. the other possibility is the opening of liaison offices between the two countes as a step toward the normalization of relations between north korea and the united states. so we'll watch for that. but of course these are two free-wheeling leaders who like to negotiate on the fly and maintain a lot of flexibility, as they get together face to so just about everything is on the table at this historic second summit between the two leaders here in hanoi, vietnam. for "nightly business report," i'm eamon javers in hanoi.

an and there is also interesting economic story unfolding in vietnam. the country hasf ecome one o wee surprise winners of the trade war ben the u.s. and china. eunice yoon is also in hanoi for us tonight. >> reporter: kim arrived in hanoi today. hend president trump a expected to first meet onve wednesdayng for a broef one-on-one and have dinner with their advisers. then on thursday the two will have a sers of meetings. kim is very security conscious and we don't know his exact movement so he has met with vietnamese officials. i'm at a factory that makesnd exports clothes to the united bly as and this is pos model for their own economic development. vietnam was an isolated state-led economy and llansitioned success to an open economy. managed to do that without political upheaval. kim ha feared that economic reform could lead to regime change.

vietnam is also seen as attractive because it's been able to carve p outolitical independence. the u.s. used to be an enemy and now it' an export market and that has given vietnam leverage over china. north korea is entirelyt dependn beijing. he won't be able to do what vietnam did iforth korea remains wrapped in sanctions. the trump administration's offer on the table is we will make you rich if you give up your nuclear weapons. the question is will this visit make him more willing to take that offer in the path of denuclearization. i'm eunice on in hanoi. macy's is trimming its management ranks. that's where w begin tonight's market focus. the department store plans to oiminate 100 senior management jobs as par a plan to save $100 million a year. macy's reporte better-than-expected earnings and revenue in the most rectet qu and said its plans to double down on its most popular mehandise likeeauty and jewelry to help increase its

profits. despite offering a flat outlook, macy's rose 1.5% to $24.72. higher demand for its dunkin' donuts branded coffee held j.m. smucker beat quarterly earnings and revenue expectations. the package food maker alsote bene from its purchase of the premium pet food company. the stock rose 5% to $106.09. >> troubl with the s.e.c. again. the agency has asked a judge to hold him in contempt of court after musk tweeted abo tesla's projected vehicle production saying it violates aatettlement t reached with musk after he tweeted about taking tesla public last ye. separately, investors of the energy storage company maxwell technologist are suing to block tesla's acquisition of the company. tesla's ahares were down fraction today to $297.86. and a federal appeals court has cleared at&t's $85 billion

takeover of time warner. the ruling rejects the justice department's claims thaalthe ould reduce competition and raise prices for consumers. the nj has plans to appeal further. at&t was up slightly at $31.22. and wwy forme weight watchers issued full year guidance that was below expectations after quarterly results missed estimates. the company said the year got off to a, quote, soft start and its winter recruiting campaign didn't deliver as many newmb s as hoped. the disappointing guidance initially pent sharesmmeting after hours. they closed the regular session up just a fraction at $29.57. jeep, perhaps the hottest auto brand in the u.s., is earing up for a maj expansion. fiat chrysler says it will add nears 6500 j in new or expandinged jeep plants in the detroit area, while announcing plans to layoff 1300 workers in illinois.

phil lebeau has more on jeep's shifting strategy. >> reporter: jeep, which once usedag the t line imported from detroit, now at the heart of a otor investment in the city. fiat chrysler is pumping $4.5 billion into facilities in the detroit area. that includes converting an o engine facility into a final assembly plant. ju last mon fiat chrysler's ceo said the company needs room to build all new wagoneer models. >> those new vehicles need new capacity. there's no way to fit it into our existing infrastructure so we'll bring capacity onboard for those. as you know, the pent-up interest really has ensued. >> repor ir: while jeep adding jobs in michigan, it's laying off more than 1300 workers in northern illinois, cutting a shift at the plant that builds the cherokee. over the last dealde, jeep have exploded. nowasily surpassing a million hicles worldwide.

fueled by spot-on styling and a growing love of suvs, thanks to relatively low gas prices. still, the company knows gas prices can spike quickly, so t new production will include plug-in and fully electric jeep models. the detroit area, adding thousands of jobs is a welcome shot in the arm. >> this is a moment in our state whe we've got some momentum mere that we've got to keep our foot on the gas. >> reporter: lawmakers in michigan now have 6 days to agree on requirements needed to lock in jeep's expansion. that would secure the biggest auto investment in that state since the recession a decade ago. phil lebeau, "nightly business . report," chic coming up, the brexit deadline is fast approaching, and that has some compani sc

here's a look at what to watch for tomorrow. as we reported, the fed chairman, jerome powell, will be back on capitol hill for a second day of testimony on the economy. retail earnings include lowe's, best buy and t skrchjx companie.

trade representative robert lighthizer is expected t testify. that's what to keep your eye on for wednesday. trade uncertainty is prompting american companies to pull bac on their expansion plans into china. in a survey conducted by the american chamber of commerce in china, roughly one-third of respondents say they will not invest more in that atcountry. compares to about a quarter of respondents last year. their ihief conce u.s. tariffs on products exported from china as well as rising costs and slower economic growth. and now to thed uni kingdom where the clock is ticking. britain is scheduled to leave the european union at the end of next mth and at this pointo one is quite sure how that will happen because no pn has been agreed upon. that is creating a lot of headaches for one company in southampton, england. >> prime minister --

>> thank you, mr. speaker. >> reporter: as theresa may hases to her latest parliamentary cenge this week in westminster, businesses across britain battle a stubbornly uncertain brexit future. with well-known names ready to run down their facilitie or shift jobs overseas. u.s. e-commce firm pfs has chosen a different route. >> what we see now is not the full picture. >> no. >> reporter: lisa cooley left memphis, tennessee, lat last year to open this in southampton. she's barotyn her feet under the table, but brexit's march 29th deadline is already demanding her attention. >> it's a task trying to start something up in that span of time. and it's also a task trying to get inventory moved and imported here and set up. i believe it's a little chaotic in the beginning, but, you know, at the endi our goal is to service our clients. >> reporter: those clients are as global as her consumers and her company employs thousands o

workers worldwide. until recently pfs had only one european major warehouse in belgium. just an hour outside brussels where theresa may traveled to try to salvage her divorce deal with the regardless of how well or badly brexit negotiations go in the that weeks, it's clear many sectors seeking to do business here in britain have already made significant changes. this warehouse is one big example. logistics can be relentless, and firms like pfs can't wait on the politicians while they wrap, pack and ship people's parcels. >> there's timelines. it takesime to get equipment, it takes time to get your systems up and going. of course you have to go through the process of hiring employees. time i n wouldn'tessarily say is on the side of the retailers we service. >> reporter: brexit may have shattered british politics, b the economy has so far survived,

with unemployment at its lowest level in generations. >>n the long ru it's more the uncertainty of not knowing which direction you're going to oceed. i think that's the biggest concern and the biggest shallenge here. >> reporter: and firms make preparations and bank book provisions, those brexit ncerns are now big enough to fill a building. >> but it's not just small companies watching brexit, so is boeing. that company is shifting spare parts between its distribution centers in the uk and elsewhe in the world. according to reuters, the global aerospace industry relies heavily on those distribution centers and an integrated supply chain. the boeing official said the company is making suret has parts where they're needed. to read more about the business threat of ano-deal brexit, head to our website, nbr.com. before we go, here's a look at the day's numbers on wall street. the dow jones industrial average

was down 33 points, very choppy trading session. 26,057 is where we finished. the nasdaq fell 5 and the s&p 50 was off 2. and tomorrow, the fed, trade and earnings and that summit will all be in focus. that is "nightly busines" for t. i'm sue herera. thanks for j aning us. ha great evening and we'll see you righ

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