. this is "niretly business rt" with sue herera and bill griffeth. another round. china reportedly wants more trade talksefore agreeing to phase one of the deal, and ininstors aren't sur what to think. boeing thshakeup. ceo is stripped of his chairman's role as boeing moves moressively to resolve the major challenges facing the company. > new capitalism. the salesforce ceo is the latest business leader to say the system needs a reboot. those stories and more on "nightly business reayrt" for mo october 14th. good evening, everyone. welcome. bill is off this evening. the optimism of friday did not carry over into the new week. stocks drifted between small gas and small losses as investors tried to fure out

just how mh progress was actually made on trade. treasury secretary steve mnuchin maintained today that a fundamental agreement between e two countries has been >> it is subject to documentation and there's a lot of work to be done on that front, but it includes intellectual property rights, it includes financialrv es, it includes currency and foreign exchange and it also i very significant structural issues in agriculture. >> but some investors feltwe detailre scant and china is describing the agreement in a way.erent nice yoon starts us off tonight in beijing. >> reporter: a chinese stateio mediagy attempted to explain why the chinese have th been describinoutcome of the trade talks as substantial progress as opposed to president trump's term, deal. the notes are closely watched by trade experts say that the reason is even though the chinese shares the same spirit

as the trump administration on the talks, that t t cy'retious about their words becau of previous, quote, flip-flops. that has been the message from the chineseide that from agreement is not yet in place. state media hereas made little mention of beijing's pledge to buy up to $50 billion of u.s. agricultural products except for tauron which said buying fm goods ichina's unique c bargainips and should be complimentary to the needs. i talked to a trade official and he said similar to a bloomberg report that in his opinion the chinese side would ask that the u.s. scrap a december tariff hike t make the phase one agreement more balanced. he also said anyext thatre would bented to president xii jinping for the summit would haveo be completely locd down. the chinese have been nervous throughout this process that

president trump could say or do something that could potentially embarrass president xi. ticking for the trade clock is negotiators and from what treasury sec tary steven mnuchin said, there's a l of work to do by nid november. for "nightly business report," i'm eunice yoon in betg. taution surrounding the partial trade deal put pressure on oil prices. the energy department is watching oil prices in the middle east after the u.s. said it was deploying me troops in saudi arabia. domestic crude settled 2% lower. one of the companies that has the most to win or lose in the u.s.-china trade war is caterpillar, in part because of the amount of business it does in that country. that's why it's followed so outlook is becoming more why its difficult to predict. seema mody has more. analysts see caterpillar as a of trade proxy for the market given it global footprint tied to china's growth story as well as its reach into the u.s. mark.

>> caterpill isrobably the single most leaf verieder namer the u.s. china tradens relat you could find from both ends. simply because it has to get ath benefit fro farmer's side, u.s. side, and just generally from the chine demand that they sell into qui q a lot over there. >> reporter: the back and forth on tradeas created a volatile year for the stocks. shares have trailed as peers and the broader market due in part to the bloomg trade thwar. have disrupted trade. china's slowing economy has hurt profits. caterpillar also generates a significant amount of its revee overseas making it highly exposed to the slowdown inhe global economy. >> the vulnerable groups, the a farmer chinese demand for u.s. multi-national corporatis are really the crux of caterpillar's business. son tositive side, it really gets a tremendous amount of benefitf there's anyof kind problems, it's the first one to be hit. that's why it's so incredibly sensitive to both sides of the u

>> reporter: some say any sign ofe- descalation on the trade front will improve visility around the f aure earning signs o progress between u.s. and china will lift confidence among companies makin capital investnts but other market experts are less optimistic. others say a partialrade dea helps improve sentiment but delaying new tariffs only stops things frometting worse rather than making things materially better. induststal ana also point to the latest headlines that suggest the chinese are more cautious about the trade agreement made in washington last week which kps the outlook for cat err ter pillar cloudy. later ts week china will publish the figures on growth which will be watched closely by multi-nationals like caterpillars where in the past they have see them as owth. analysts caution if china's economic progress slows it will slow downat perfect pillar. and the trade data out of china was weaker thanexpected.

according to rters china's exports fell more than 3% in deceer from a year ago while imports dropped more than 8%. economists pinpoint the decline on ongoing trade war with the u.s. t worldn trade organizat has formally backed u.s. tariffs on eurean uni goods. the trump administration no for previously scheduled stacles sanctions that could take effect on friday. unless a deal is negotiated between washington and brussels, the tariffs will hit everything from scotchhisky to french wine to italian chee. raising tariffs on steel imports from turkey back 50 he is also ordering sanctions against officials in response to turkey's incursion into syria which the white s houses threatens stability in that region. as we mentioned, stos made small moves as new trade coerns emerged. trading volume was also thin with many banks and fix income

desksde shut in observance of columbus day. the dow jonesustrial fell to 26,787. n thedaq down 8 and the s&p 0 was off 4. attenti now tur to earnings which kick off in earnest this week and we could hear detai on how the trade war's impacting corporate america. we're joined by david dietz, president and chief investment strategist at point view wealtht manage welcome, david. nice to have you here. >> thank you, sue. >> what kind of season are you expecting overall? >> the headline number is quite we're down 4.6%. once you start digging into the details it's not quite that bad. earnings per share because of massive stock buy backs wl leave earningsngown only 2%. if you look at the average stock as opposed to the market cap measurement we're actually going to be up 6%. the other thing to watch, sue, is revenues. a revenu up 3% market cap weighted up as much as 4% on the average stock. >> what about the trade war that's going on between the u.s.

dchina? this i believe is really going to be the t first earnings seas inarnest where we may get a chance to really see how trade and tariffs are affecting stocks. >> you're absolutely right. the wheels came off the buste i s of trade negotiations in may. that was halfway through q2. q3 is the first one where we have theull negative winds of thesorade tension. think the more overseas orient a compa is the more goods are going to be impacted. that's certainly in sync with what earnings analysts are expecting. analyst tech companies are going to be 10% and energ materials yompanies are very sensitive to the global economy will also be down m more thanhe overall market. >> how important are the financials, the banks? they're the first to report. we're going to get some this week. what do yo think? >>inancial are very important. first they can set the tone because tony go first as you just mentione because the banking system is touched by about every actor in the ecomy whethers a borrower or as a lender or both,

they have a g gd sense of the economy.ul i caution that a little bit insofar as they're domestically oriented. i don't thinkhey're going to the best barometer overseas. they're very intersensitive. we've seen a decline in the net interest margins. they're impacted by that in a way that other parts of the economy really aren't. >> what w sector do you thil fare the best? >> certainly the interest rates interest sensitive sectors will benl f from the tailwind this year. that will be particularly utilities, parcularly reits. health care companies which also aren't too exposed tthe global economy will do better than the average company. >> all right. vid dietze, thank you for being with us. >> thank you. >> david is the presint and chief investment strategist at point view wealth management. well, months afterla rers around the world grounded the 737 max due to saty concerns,boeing's ceo has been stripped of his role as

chairman of the itcompany. s the latest indication thaha boeing's board is getting more aggressive i resolving a crisis thatats weighing on boeing and its sharee. pric phil lebeau has more on the changes in the c-suite. >> reporter: boeing's executive shakeup means ceomuilenberg will no l be chairman. >> in this case a non-execive chairman is very little difference than a presiding or lead director, the role heus prev had. they're going to dine dt in a way i think which gives him a little bit more authority. >> calerun has vast ence with major industrial companies including ge where he ran the aircraft engin division and caterpillar where he sits on the board and once served as chairman. after being selected as chairman at boeing, calhounaid t bod has full confidence in dennis as ceo and believes this

vision of labore will ena maximum focus on running the e business with oard playing an active oversight role. back in april at boeing's annual meeting more than 1/3 of thede shareholrs voted toehplit the chairman and ceo jobs. after that meeting muilenberg dismissed questions about possibly resigning. >> in the light of the crisis facing your company and in the interest of re-earning the trust of the flying public, have you coided resigning? >> i think the important thing here again is we're very focused on safety. >> reporter: that focus goes software d correcting problems that led to two 737 max crashes. it also involves growing question about the culture at boeing. last week an int depth rep by a panel of aviation regulators slammed the company for failing to make proper disclosures about key components during the max certification. now with hundreds of max planes

parked around the world, muilenburg's top priority isg getthe plane cleared to fly again. he's sticking with his guidance that the max will be bac in service this year, which means boeingr has to clveral hurdles over the next ten weeks in order to convince the faa and other regulators that the max is safe to fly. phil lebeau, "nightly business chicago. in addition, the southwest pilots union today said it is looking at, quote, probably a february time frame to say the least, end quote, for the retun of eing's 737 max. ot's time t take a look at some of today's upgrades and downgrades. nike was upgraded to neutral americaerrill lynch. bank of the analyst cites the outlook for the sports wear business especially for women and children. e price target is 9d $8. the stock rose 1% to $94.88. downgradedothers was to neutral fromt positive

susquehanna. they cite the stock's valuation following ceoutperformance s e beginning of the year. the price targets $42. the stock fell a fraction t $39.25. >> tapestry,hearent company of coachchas downgraded to neutral from buy at ubs. the analyst cites the rising popularity of used handbags. the price target is th$25. stock fell more than 2.5% to25 $2 delta airlines was downgraded from equ weight at stevens. they cite the outlook for higher costs for the second half of the year. the price target is $57. despite the downgrade the stock rose to $52.99. still ahead, the switzerland of streaming. roku has found a unique role for itself in the hyperdu competiti stry and it's paying off.

don't look now, but roku shares have been soaring this year a it's all because of the company's distinctive position in t fast-growing streaming industry. julia boorstin l lks at roku's riesz and its risks. >> reporter: they've been a rocket ship up 300% year to date th expectations are that roku will benefit from the exploon of streaming apps. with disney plus launching followed byo max and peacock, roku is eected to gain ad revenue. if people t subscribe through roku it will earn a share.

>> you want to be the switzerland during the streaming wars. they are switzerland, then the wars are occurring around them. they should be paid by the arms dealers. >> reporter: in addition to generating ad revenue and taking a cut of subscription revenue and downloads, ro also makes money from selling streaming devices which range from $30ge $100. al from f licensing its technology to smart tvs which cost $200 andup. roku had more than 30 million active accounts as of its last quarterly report and analysts expect that number to grow as roku capitalizes on a shift to streaming and as it begins its ternational expansion launching in europe next year. >> roku has been entirely north american, entirely u.s. phenomenon. they announced they're launching into europe. i don't see any particular reason why they can't bees suul as a device vendor. the roku devices as anra ong system vendor and intomart tvs and the rest of the world and

also as streaming platforms. >> reporter: in contrast to roku soaring on the potential for it to benefit from the streaming wars, netflix has given up most of its gains from earlier in the year. now up6% year to date. this as investors watch all the subscribers and content.treaming for "nightly business report," i'm julia boorstin in los angeles. smile direct clu sees challeng in california, and that's where we begin tonight's market focus. california's governor signed a ll allowing the state's dental board to extend operation overseeing and regulating dental services until the year 2024. the new law also gives protections for patients who receive direct to consur orthodtic treatment from technological platfms suchs smile direct club. shares slid nearly 13% to $9.70. conni conocophillips is selling to santos. il and energy company sees

this as an opportunity to shift capital to other projects. shares fell an fract to $56.13. both lyft and uber areuing new york city as the ride sharing company's challenge thes big applew rule limiting drivers from snding time cruising in manhattan without passengers. separately uber laid off 350os employees a multiple units and marks the third round of cuts in recent months totaling more than 1,000 positions. lyft shares were up a fraction to w$39.80le uber shares rose more than 3% to $31.12. after the bell riatta pharmaceuticals repted successful trial results for its treatment of a neuromuscular di rder. the news helped shares initially spike 40% in after hours trading after closing the regular session up about p5% to 159. > theco-ceo of salesforce mark benioff said a capitalis s

we know it is dead. he said the current system has d to inequaliua. this follows recent comments from facebook ceo who said of billionaires that no one deserves to have that much money and senator s sders whod that billionaires should not exist. so does capitalism need a reboot? we are jrined by gordon, professor of michigan's school of business and the co-director of economic policy resear. welcome to both of you. >> thanks. >> thanks for having me. >> eric, you thinkhings are pretty much fine the way they are in terms of capitalism why?>> well, y know, i don't kn if everything is fine, but i don't think capitalism isdead. i don't think it needs to be anged into quasi socialist capitalism because the problems benioff complains about, things like income inequality,o right of privacy, no climate protection, those are big problems inocialist economies.

if you look at china, there's income inequality, giant incnce inequality, no right of privacy and climate protection, it's just terrible th ye. >> mark agree with what mu of mr. benioff says. number of ceos, 200 ceos have signed the same contract that he d talking about basically social justice and income co equality, ect? >> yes. and nobody's talking about turning the united states into china. we're having a debate and if you look at bernie sanders campaign, r exple, he got43% of the vote in 2016 and his ideas are now the main ideas of the democratic rty. medicare forall, $15 minimum wage, college free - tuition free college and forgiveness of student loan lbt. f that happened because people really want this. the people are really ready for serious change and i think that's what we're really talking

about, getting the things in this country that oth high-income countries have. we'rhe richest country in the world and we don't even have health cale as a right. >> markk- rather, eric, what is wrong with what mr. benioff isa ing when he says, quote, it's time for a new capitalism, more fair, equal and sustainable capitalism that works for everyone, where businesses including tech't companies d just take for society but they also give backe is tomething wrong with that? >> no, i don't thinknk there's anything wrong with at, but i ink whenbenioff goes beyond at and says capitalism is dead, i think that's wrong. i think capitalism is a system, just like socialism, is a system that's been tinkered with over many, many years. the capitalism we have today is not the capitalism we had at th turne 18th to the 19th century so i think capitalism needs to evolv and i think it will evolve but i don't think

it's dead, which is what benioff claims. >> mark, what aut that? what aboutac the that 200 change capitalism, trying to o change socieu but when look at the grand scheme of things there e a lot of oergs who have not signed off on that? >>hiwell, i -- i don't know what the author of theth op ed we're talking about really meant by capitalism is dead. he means a capitalis we know it in the u.s. is dead in the sense that peonse are really unsatisfied. look, we're at the peak of a business cycle that's the ngest running expansion in u.s. history. unemployment is at a 50-year low and inflation is very low and people are really dissatisfied. thhe'r ldiking forind of change that i've just talked about. so clearly somethi is very wrong. you don't even need t statistics. you can just ok, talko somebody who grew up in the '60s orth '70s or eve '50s and a

person -- a worker with an average wage or salary could buy id tose, send their college and the kids didn't come out with loans that they were rest oo pay off for t their lives. so something has changed. productivity and growth in the all went to the upper end of the income distribution. that's really a fundamental, deep problem. >> eric, you get the closing thoughts. you know, i agree with mark that that's a deep problem. i don't know if it's caused by capi blism. .it cou caused by the government. it could be caused by other soal ctors. it could be caused by an education system that has left people behind. it's a problem. i'm not sure who has caused i or how to solveol it. >> on that note, more to discuss next time around. eric gordon with university of michigan's ross school of business and mark weisbrot at the center for ecomic and policy research. still ahead, the brewing

battle between policians and social media companies. but, first, a lookt how commodities fai s fared because the bond market was closed today. booking holdings, formerly price line, is the iast one to back away from libra. the decision follows similar moves by ebay, master rd, visa and stripe. libra says it remains focused on moving forward with the projects treasuretary mnuchin said he toldai libra representativese would take action if the crypt kurpgs si did not meet regulatory standards. > elizabeth warren and mark this time the democratic senatoi and facebook ceo are feuding over fake ads and they're not thenly ones.

ylanmui hasur o story. >> reporter: senator i warren accusing facebook to allow people to put fake ads on the platform. she proved it by run a fake ad herself. or claed zuckerberg endorsed president trumppresident. it argues what it does is give trump free rein to lie and pay facebook gobs of money to push out those lies to american voters. facebook has been very clear that politicians areeld to different standards on its platform and that anything else would be undemocratic. >> would it be acceptable to society at large to have a private company in effect become a self-appointed referee forhi ever that politicians say? >> i don't believe it would be. in open democracies voters rightly believe that as a general rule they should be able tohaudge w politicians say themselves. >> reporter: and it's not the only social media company that made exception for speech frome

politicians. twitr notifiessers that it may violate the standards. youtube has it violated from candidates and others. >> when you have a political officer that is making information that is really importan for the constituents to see or for other global leaders to see, that is content that we would leave up because we think it's important for other people to see. >> reporter: the cr:rent politica climate is testing the limits of that approach. former vice president joe biden has asked all three platforms to take down what he says is a misleadide ad from pre trump's campaign that goes after oehis son. all three companies refused r b it's facebook that's taken most of the heat. >> facebook is condeed whether they do, whether they don't. and, yknow, they don't want to be the arbiter and they don't want to take t sides inse popotical debates and their stated policy, ithink, is fair. >> reporter: expect thiight to continue as the democratic presidential candidate and

trump campaign gear up for tomorrow's debate. for "nightly buness report" i'm ylan mui from washington. then nobel prize economics was given to a trio. e three tested specific popocies to improve educational outcomes and health and oth o issu associated with the very poor. two of the winners are from t. m. the other is from harvard. and that is "nightly business report" tonight. i'm sue herera. thanks for joining us. have a great evening see you tomorrow.

woman: tmas is "bbc world news erica." is me possible by... the freeman foundation; by judy and peter um-kovr foundation, pursuing solutions for america'neglected need f and by contributions this pbs station from viewers liku. thank you. laura: this is "bbc worlnews americer" reporting from washington, i am