♪ >> announcer: this is "nightly fesiness rept" withl b gr herera. red october. at least for stocks dropped on the first trading day of the fourth quarter, on concerns about the health of the american economy. broker battle. charles schwab cuts commissions to zero. good inves but comes at a cost for asset managers. housing mismatch. in the fall ide real estate market, creating aves and have ntsotot th "nightly business report" foa tu october 1st. >> and we do b you good ing, everybody. and welme. the first day ofhe fourth quarter turned out to be rough. day's declines wiped out

everything the dow and s&p gained during the third quarter. investors wer surprised first thing this morniirsty a new report on manufacturing. that showed that sector's a decadslump in that added tooncerns that the u.s. economy is slowing and e feeling tects of therade disputes. the dow at thelose tod down 3637 bob down to 263.57 7pisani following the slide today. >> ugly first day of quarter and dwou are it would strunling 340 points wiping out all gains from theua thirder. the thism machining index fell 47.8 in september, the lowest i readn a decade. remember any read bowng m be i0 a. recessi the big miss was a problem for

the market, moving in a 50-point range since the report came out at 100 a.m. eastern time. that's a large reaction for the market for ism data report. the outsizeded reaction was dueo the sheer size of thehe miss an e jarring headline but also cause all themo t around global trade and weaker global economy, the s&p is only 3% from historic highs. there is a lot of risk to thedownside. the newspp immediatelily d all the economically sensitive sectors and materialsri indus and materials. bankl stock f as yields dropped. the key issue now is will itp bleed to k spending? might it impact consumer spending in the u.s.? rememb, that's the bright spot holding up the glo tl economy. so this all a means that this september jobs report on frinoy becomes very impoant. all it talks is l oneousy jobs report and people will got out trying to conduct o conct the

ts that come sout thedo consumer is weaker. we'll get the services secto oh data on thursday which if strong could help offset the manufacturing weakness today. keep eye on big consumer stoc aks thant have risen home depot, starbucks, . mcdonald's, costco all weak hbu consumer iser strong. for nightly business report, bob pisani at the new york stock exchange. >> let's talk about more what to expect from the market in the fourth quarter. the chief market strategt at national securities. welcome ba, art. nice to see. >> you thanksor having me. >> as i understand it, you do not think that today por tends a continuation through october. is that a correct read. >> tha often times we look at the start of the year and say as goes thee first week so goe the rest the month. i think it's getting the cart beforehe horse. i think what happened was we

know the global machining has in slowing almost every pmi has been in cononaction except the united states now we had twi mont a row where the t ism comes in below0 ich means contraction. that's the problem. we know manufacturing is not faring well because of the u.s.-china trade war. we know the consumer is faring we pep we have a the bipolar economy. and the consumer is about 70% oo gdp is doing well. and pull push >> thishoul t a busy month typically. ually is we get the earnings, the impeachment inquiry now, the fed meeting coming up. but for you the most important will be the trade talks with china, right? >> yeah, iighink this market has shown keying on the tone around the u.s. china trade talks, the escalation and and the back and forth. the tone has gotten are the beruer. that w fbe most of the september. august was bad and may terrible. and we are seeing bowing sides

we red some tariffs or no new tariffs until october 15th. e other side ofe o that the tabe china has decided to y, listen,e're buying more agricultur products. we're moving the right direction. c if thattinues i think the market can get constructive again. if that escalates and we walk away from the meeting in oct fer e way we walked away from the meetings in august, i think this gets worse and the market willo start unravel. i think that's the key point. but you mentioned everything else, earnings season, another fed meeting. a on that note, artuchank you so art hogan national securities. it>> thhank you. elsewhere, trading online got cheaper. charles schwab said today that it's eliminatingmi cionssso trade stalks qb etfs andnd ptions, the decisionollowing a similar move by rival interactive brokers. ile it's goo news for brokerage customers. investors don't see it as good ws for t t industry. shares of schwab fell sharply

todayri so dils like td mere trade and e-trade and interactive sbrinkers. jo us with his' assessment of the move we welcome back phil blanto, the ceo and president of thalmann management. >> good to see. ommiions are coming t' n but se to say they arein bo monumental shift gow dollars now zero.hundreds for the client andof it's a benefit. now we are able to eliminate conflicts on what weht or might not buy. the idea of cost is eliminated. where does it the put the focus on asset managem tt? what's best asset? can i i rotate the portfolio? sudon't have to worry about the 's auihag af other firms in that the focus is on the greatest mutual fund or etf or money market they offer and can the compete for it. >> some of the stocks getting hardest hit today, doesn't have the diversity in terms of the

different businesses underum thr ella as schwab does. >> very problematic for firms that don't. this is an an asset grab watt t way to get sticky assets in the door. e do that you ho order variety of serviers and products. if you don't have those you'rel in tro that's the only way they survive on the other side and if they don't it's problematic sflos in a symptom of electronic trading. the trades than it has been. >> yes. >> it makes sense for them to want to bring the commissions down fae. >> there i a variety of things imcting. collapse of fees everywhere. etf was mutual funds. we watch how we work as a industry come down. robo rsvi.thselient needs and e the connatet of bying moop me as an asset manager it it eliminates the asecretary to focus squarely on asset management traern transactions. >> i ms. henninged phil this is an asset grablly schwab. that force more skongs in

the industry where you see companies that don't have the broad base business that schwab has seekee out other partners? might you see a lot of deals. >> for sure. it' slow process. it's not a knee jerks where they cutees. it's they say how it gs. but what do clients need? canhey give them pkage products working for efficiently. >hat's the money grab. o generalle you have the asset you keep it. it's how the offering the retail offer. for the end client now the options are better because youe ed cost >> wow. >> amazing. thalmann asset management.rg. thanks. >> in other issues general motors ling off workers in mexico due to the strike in the u.s. the workag sto has create add parts shortage.

halting pic up and tnsmission atexico. d the uaw today says that gm's latest offer is short. the strike is two weeks old.ld the share fell in the trading session. meanwle investors closely monitong developments in washington. not onl a on trade buto on the impeachment iuiry in the house. and in ea new sury shows some americans canned concerned about its impact on the economy. steve ley. has more. >> the cnbc survey shows americans by a narrow ameriopns sing impeachment but fewer are against it than two yeat ago. in the nationwide poll cnbc asked if congress should hold impeachmentearings to remove president trump from office. 44% favored. 47% opposed within the poll's 3.5% margin of era. but that's a closerargin than

twhuehe wnhen q 54% opposed process a big chunk of tho hem showed up a rise in percentage of americans unsure. mike roberts and cnbc's republican pollster said the american people not jumpingng toward kbeechlment tioy're caly moving away from opposing it. some americans thinkt could hurt the enomy. stock market. 40% say it's bad the economy f overall. rbut 23% answe that it will huri th personal financial situation. the real bad news for president trump came in decline in both the overall and in his h econom approval ratings the president's job approvalrov rating sunk to 37% the lowest level and 42% for approva on the economy also lowest for the first time. 50% of the public f tdisapprove his handling of th

bounced back in the past and maintained a steady but low approval rateding around 40%. this time he has to make a comeback from the roest level od presidency while facing impeachment proceeding in for "nightly business report," steve aliesman. layter in the program, even though the presidential election is more than a year a aigt there are big th political advertising race. now to other stories w newres.tt are in the e' demonstrations in hong kong protesters clashed with rio police building bfires and barricades for the first time since the protests again and live rouir. a hong kong police officer shot a teenage dmorngts who was conscious and taken to the hospital. t the same time as the protests, beijing was celebrating 70 years of communist control. e ceremony included a military in ecomind mary show off

strength. prenest x promised to keep hong kong under the one country two systems framework. still ahead,ommercial real estate risk. >> i'mraobert in new york city, which could be the hardest hit market in the we work pullback. we take you inside the building partly owned by the company founder that could be the bell weather of the next downturn coming up on nigpolyusiness . ♪ construction spending rose less than expected e in i augus. non-residential construction declinedting rise in home

building. according to the commerce department, constructionn spending edged up 0.1%, marking the fo month of lackluster results. the last few reports on housing have shown a pick up in activity, no question. but a grossing mismatch is creating a dide between the haves and have young buyers are priced out and on the move up market is. movi diana olick has more. >> reporter: this fully renovated atlanta home priced at $215,000 a bit below the median home value. and it sold quickly. to an wnvestor whol rent it out. a scenario playing out all over the country. as entry level buyers compete with investors for precious few affordable homes. fuentes says it can be rough for clients looking to live in the house. >> it's too much i don't get false home. there is no room for negotins in the homes.

they have toff top dollar. costs. no closing and it's longer an area where they can negotiate and g a great deal. especily up against the uash investors. em take a look. >> bryant moor works in finance and he and his wife worry about the economy. but in thisetompetitive ma they're looking past it. >> look at what's going on wit meg loan you have to make a decision but y palyoudye c b whaant't mau or mn happen. >> the low end of the mechanic is where most of the demand is. but not nearly enough supply. that's why seems of homes priced below $250,000 are significantly lower today than they were a year ago. sales are strongest in the 500 of750,000 range but make up0%s1 he priced homes above a million are weaker than a year ago but that's more to do with taxes and volatility in financialarkets. home builders are benefitting

from that lack of existing homes fout sale there is incre thee mismatch between their prices and the prices buyers are looking for np nearly t ees of homestead today are priced between $250,000 and and $1 mil but less than half of buyer looking to pay that much according to th association of home build he is survey. about a quarter of buyers want a home priced at$150,000 or below process. but barely three% ever new constructiont the prays poin with new homes out of reach and the competion for affordable existing homes high. families nde young today are oftence pdri "nitly b" diana olick in washington. sfr residential real estate to commercial. an a company getting a lot of attention.wo we, the firm viewed by many as both a disrupter andrt risk. ro frank is in new york tonight. >> reporter: wework owork is the largest commercial ten 199new

york, london, chigo and.c. and paid top dollar for prominent office locations in t cities around worldld but now the hecompany's pullbac could ripple through theta real markets in major cities. and this building i downtown manhattan highlights the risks. it's partly owned by adam neumann, the and now formerly ceo of wework. workweek leases and ibm subleases from wework th building is for sale with a listing price of $110 million, seen as a big, est for real estate valuesied to we wor neumann bought is it in 2015 with a proton for $est million. but there are now multiple levels of dort. hewed to buy his share of the building and there is a $78 million refinancing on theabling. so the loans are now higher than the original purcha provides. wework has been critical to the manhattan real estate market lessing over 7 million square

feet of space. but as we work struggles manhattan has a an oversupply of new commercial offices from projects like world trade center to hudson yard. flexible office space compani now leaseore than 70 million square feet of space worlwoide, rental rates deteriorate because of the wework factor among oweer things. you're going to see at somein a catalys that's going to kick-off a major repricing. when that happens, you know, it's sort ofatie bar the door. >> wework declined to comment butn one rea i'm old adam neumann was selling thewa buildg to deflect criticism of the self-dealing ahead of the ipo, the ipo now on hold foindefinitely. "nightly business report" i'm robert frank in new york city. u has a uew way of delivering pennsylvania packages where we begin t market focus with the faa gichg the usb the

approval to deliver using a fleet of drones. the company initially plans to with a possible expansion t other services in the near future. the ceo also believes this will have an impact on its growt we think it will be an enabler of jobs, especially at the beginning because when you such as drone delivery, you also have a better chance ofe o gett yotomers the rest of their deliveries. so if we ar growing our business, then we will create opportunities for our drivers at the same time. >> anday on this dowhares of ups down more 3% to 115.81. u.s. steel takesst 50% in low-ival big river steel, a deal that could be worth more than $2 billion. u.s. steel then hasel the optio to take complete controlg of

river over the next years and the company ceo sees this deal as a big st. by022, endless casting andting g, best north american mill will be created which has again, t best of both, integrated and the mini mill technology, that willappen we'l complete that in 2022. with big river and what we're buying, we're buying talent, expertisend creating this >>relatiship. .s. steel rose on adownday more than 3% to 1193. strong sales s of the franks re so the saucing and french's mustard welco mccormick top expectations ands they citee strong demand in the eriks and chinar jumped about 7% to 166.95. shares of alta beauty higher after a cpany award member who raies was also an executive at chenille bought 250,000 shares

through an entityd he cxth largest group of alta. tannidll alta shares rose 6% t 265.99. after the bill stitch fix posted better than expected earnings thanks to expandingan the onlin styling service. to include capturing for kids, maternity wear, petite and plus sizes. shares wereolnitiallyile in after hours tradingdi closing the regular session up more than 4% to 20.06. the secretiveorld of swiss banking rocked by a scandal. credit suisse finds itself at the center of the drama including spies. jeff cutmore has the story. >>onight kris swe lost the ceo but at ast the job appears safe. eo follows removes in an iestigation conducted by the board of credit suisse into

a surveillance operation. surveillance of the outgoing welt management mr.rn. he identified pursuers in zurih weeks back. confronted them, filed a complaint and a then subsequent complained to credit suisse management that he was being followed. the investigationurned up that that action had beenuthorized by the chief operating officer, pierre olivier. bouee. beauee is now gone asfs i secu. apparently, though, the ceo wasn't aware of the action that being taken. c of the board, whether we should be concerned that the ceo didn't seem t know what was going on in his own bank. >> ouslyur we base decisions on the evidencee we

have. oef obviously discussed this point with him. the inv atigatorsed him, interviewed him aboutbo this. we have absolutelyde zero ee that he was informed about it. >> there have been manytrange twists and turns in this story. uze media here in switzerland has been for months about the fallingal out between mr. kn and jan, t am and whether this was the kamgtsist for the departure. one of the more unpleasant twists involves the apparent suicide of one of the security something the board has expressed its deep regrets over. and they have also apologized unreservedly to ikbel karn for

the surveillance operation and said there is no evidence he tried to poach the staff when he left. they will be hoping atoa level at least they've done enough now to draw a veil over thisery murky story. for nightly business report, i'm jeffutmore in zurich, switzerland. >> coming up, politicians spending lot of mon on ads and marmg companies are the big winners. ♪ ♪ >> well the next presidential election maybe more than a year away but spending p onitical ads is ramping up.winning this political ad race so far. >> the fake news, right,he ke ns. >> thank to a contentious

political climate and broad range of political candidates ad spend something onsp track torow dramatically. with political spenlding pr17ected to grow from 2016 to nearly $6 billion for the 2020 race. this is absolutely a record year for video advertising in politics more than double what waspent in 2016 which would have been a record. but it'sot just t presidential election. youeeec s rdor house level senate gushl gubernatorial.as >> thest growing piece of the pie is digital with spending forecast toouble from the and facebook and google responsible for about two thirds of all the digital ad spending. >> the ltates f spernding even higher is the docrats impeachment inquiry. it's prompting president trump to drumtically incllase polpegn facebook the president and vice president mike pence spent wca

alone. running nearly 2,000 ads mentioning impeachment. that spendg more than double what the campaign spent on facebook in the first three weeks since september, according to research firm acronym part of te $10 million anti-impeachment atd campaign an and digital. while digital spend something growing,v local broadcast still has the biggest piece o th video advertising pie. 5 . theolitical politic 78 isle is so profitable as the election season heats up, rates rise at a faer rate. and once the campaigns identify the ss or district really decide the election the money pours into the areas. >> the tv giant best positioned to profit from locals t political ad blitz is next star, thanks to the purchase of. tribune, which makes it the nation's largest local tv company with 197 stations reaching over 67% of u.s.

household. but even media company was fewer situatns from ew scripps to cbs suld benefit from higher for "nightly business report" i'm julia boorstin in los angeles. another look at the day on wall street. the dow fell 343 fpoints. theasdaq down 90. and the s&p 500 slid 36. and that is "nightly businene port"onht i'm sue herera thank you for joining us. >>'m bill griffeth. ha a great evening. see you tomorrow. ♪ ♪ ♪ ♪

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