♪ >> announcer: this is "nightly business report" with sue herera and bill griffeth. ♪ tri o treat? stocks were a halloween trick as the dow sold off triple digits but have investors in for a treat for the rest of the 2 i9? up smoke altria cuts value of the stakel in juu to $4.5 billion. now what? and the forest from the trees, the strategy of investing in the health of forests with the added hope of preventing wildfires. all thatnd more tonight on

"nightly business report" for this halloween thursday, october 31st. good evening, everyone and weheome. bill hasight off. halloween is at a a time for eepy tngs. goblin w ghouls, monsters. well today investors were seein ghosts of a weakening economy. soft economic data, particularly manufacturing spooked the markets ande'll have more on that just a minute. and ghosts of failed trade talks. one news report said the chinese are casting doubtth over w there really can be a a long-te trade deal. kayla tausche starts us off. >> reporter: china continues to signal.s that the. u.s. must roll back all tariffs to get the phase 2 deal but the white house says that shouldn't hold up phase 1 where talks are stillmo ng forward. the president tweeting today, a new locatatn to sign the dea will be announced soon. and suggesting the deal will include more than half the chapters that have been under discussion. there are a couplef summits

calendar. the president xi jinping will in brazil in two weeks and both leaders are invited to the world economic for up in davos. but theif looming december t are viewed as a deadline. tomorrow the principals will speak speak byhone in conversation that cou yield new details and next steps for "nightly business report," kayla tausche in washington. add it up andou have a witch's brew. the dow fell 140 points to 27046. thnd nasdaq dopd dref the s&p 500 off nine. for the month all amples up. the dow just a fracture shup but the nasdaq added 3.5% and the s&p 2%.b sani has more. >> october endwood a thud hurt by me weak manufacturing numbers and a report that china hess tan to make a long-term trade deal with the united states. but it was a strong month overall for the averages. considering we avoided any scary october crashes or major market

plunges. s&p 500 sitting near historic ghs. although the federal reserve taking on passive stance on interest rates,ra the market is confident enough that theack stop is there. meaning the fed will step in and cut rates if it needs to. trade talks are presumably still on beten president trump and chinese president xi jinping. though the market lost some long-term deal.ospect o the market sberps the seasonally strongest two month period of the year. that's important. november is the second best month for the s&p since950. december is number one. that's according to the stock traders almanac. the problem is there are still bitter memories of the disastrous december last year. that conviction for a rally from here is remarkedly lacking. trading volumes have been light in the last couple weeks because a lot of traders areiting on the sidelines. some feel it they had g gd enough returns and would like to lock in retur now rather than chase advances. and the news flo from the white house on trade is very

confuseding. so next up is the friday johns report plohikely taking hit from the gm strike this month. after that all about trading. removal of tariffs is optimistic but there is some hope the december 15 tariff hikes can be put off. what aitut ther memories of last december? a key difference. last year everyone was wored the fed would begin a cycle of hikes. that was a big factor in dee mber drop. hat is not a factor this december.for "nightly business i'm bob missfy at the new yorex stocange. so what can we expect from the market for the rest of the year? joined by sandib. baghat fromt. wittier tr >> great to have you here. >> nice to be back. >> i see from the notes that you are looking for a continuation of the rally but a more modest move in the do is that a correct read? >> that is fair. and theigge development in recent weeks, sue, is that we have seen a decline in uncertainty and a deescalation

of tensions on so many fronts. away.ese come to mind right it seems like we will avoid a we seembe on track for a phase one deal with china by the end of the year. th fedas clearly communicated where they stand. and most animpoy, all those fears about an imminent recessio well, they seem to have receded because growth is still coming in above expectations. and so against that back drop, i think the path of least tsistance istill march upon higher but it will be a slow grind. maybe two, three% more to the upside. >> um-hum. >> which is about 800 dow points and 85 s&p ou0 points. >>e sticking with your 3125 target on the s&p. >> yes, ma'am. and it's based really on these key views and assumptions. no recession any time soon. so nonen 2020. we should see a modest pickupn

growth both of the economic and the earnings variety. why do we say that? itill be boosted by all the easing that all the central banks have done. that should begin to pay off. we do some resolution partial as it may be on the trade front. and that should spur growth. and then inflation is muted and that means int rates will remain roe. >> so what areas of the market think are still fairly valued and perhaps will retain leadership as the market moves higher? >> sue, let's take this all the way from the top, right. so you have the first big stock bond decision to make. interest rates are extremely low. they're not justified just by the slowdown in growth. i think investors are seekingfe and liquidity in greatdo s and they have overpayed for those. we think actually the bond market is overvalued. the stock market is fair lip and

fully valued that leads to stocks over bonds. underneath that we like the u.s. stock market than the foreign stock markets. you had to pk sectors we would take cycliecl like tetenology. >> okay. >> consumer discretionary andls financver staples and utilities. >> on that note thank you so much. sandip. >> chief investment officer at whiter trust. a big batch of economic data out today. some good some bad. run through be number of americans filing for first time unemployment rosas wildfires in california likely played a key part. personal income and spending in september rose slightly and in line with estimates. consumerum spendings accou for more than two thirds of economic activity. it was driven last monthy purchases of vehicles and spending on health cone. inflauted last month as consumer prices measured by the personal consumption expenditures index or pce

unchange. the pce is the federal reserve preferred measure of inflation but the weight on stocks, manufacturing abbas the chicago pmi measuring mfgt activity in the midwest dropped to the lowest levelce december of 2015. so let's n turn to our adviser to talk more about what this means for the economy. he is the chief committee rsm. >> good all halos eve to you. >> startingngith manufactu and broadening tohe overall economy. you think we've been in a recession in manufacturing for some time now. >> that's right. for at least three months. the kprmt proximate cause is the trade war and the self inflicted problems at boeing you can see in sentiment and pardon data. e chicago pmi had an outsize decline. ch of it had to do with gm. however there are problems in the survey that point to the trade war. >> a lotf people when they see the employment report tomorrow

may write it off because of the gm strike. but you're one who says not so fast. >> right, so, look, there is a loss of about 50,000 jobs in goods p pducing and manufacturing which is suppressed the tin i'm expecting 75,000 net gain in emncoyment. but we back out the distortion, we'll want to look under the hood to see what's government education and health hiring which is reallyeginning to drive overall hiring. we will see further problems, though, lthked t trade war. hiring is slowing by the end of the year. we should see 100,000 per month on average. it ll-election day 2020 be about 50 and the unemployment rate going up. >> butou do not expect a recession, correct? >> , don't it would take a further policy err in re trade.r iefs onll the auto imports from the eu or and uk. all we're doing is back following back the trend at 1.8% right w that's fine.

first half of next year around 1%. not stallw speed sut s enough to cause material dsscomfort acortions of the manufacturing secretarier >> what external events or perhaps eves on your radar might derail that scenario? >> well, six weeks ago, the iranian took out halff all saudi oil production. i'm surprised we havenav had mo distortion becau of that. should there be further hostilities with iran in theas middle that could be a large enough exoxygennous shock to tip the economy into recession. but probably the more proximate cause would be an intensefy indication of the trade war with china or new front with europe. >> on that not joe bosuelso. >> with rsmus. >> late last night ford upon the unit auto workers reached tentative deal. that agreement comes less than a week after gmet workersned to work following a 4 aday strike over a new contract. once the ford deal is ratified, the union will turn to fiat.

chrysl and fiat chrysler ant european auto make are psa, the parent oft peu plan a mger. as philebeau tells us the deal a prod would create global autut giant with plenty f advantages and sizable challenges. eporter: at fiat chrysler u.s. headquarters outside detroit, it may be time to change the sign, again. the parent of classic american brands like jeep and ram trucks plans to merge with pair ohs based auto maker psa, which sells peugot appear citron with you popular brands inurope. a 50 merger creating the world's fourth largest auto maker 8.7 million ned wreak vehicles last year. for psa adding jeep and ram brand along withheir strong sales in the u.s. is attractivel meanwh fiat chrysler would move into a company with the size and scale to afford the

massive costs of developing electric vehicles. after reporting better than expected tarnings in third quarter, fca ceo mike manly would not discuss the proposed merger. instead, he talked abo the opportunity to grow sales of eectric vehicles, particularly inope. >> when i looked at the pricing in europe in particular for electrified vehicles i'm much morp encouraged now than i was a few months ago, circumstancely on the full battery electric side. >> ev sales will become more important over the next few years as europe forces auto makers to meet lower emission standards. evs will also t be critical growing sales in china. where jeep has a limited presence and peugot has struggled to breakthrough. if this merger gets approved by the u.s. andve french ments, it could lead to more deals among other auto makers. as the industry looks to offset electric autoen must vehicle.

>> the mouse moving ahead with the impeachment inquiry and puts it on a c clisionrse with another piece of business, keeping the government up and running. ♪ ♪ ♪ tobacco producer altriaes quarterlyts beat estimates for its third quarter. but the company took a big writedown or reduction of value of the stake in the e-cigarette maker juul. tatang a.5 billion charge against earnings. as a result, altria shares fell more than 2% the day. frank holland has more.

>> reporter: as vaping concerns rise. marshalak borrow altria is lowering the value of its development in juul. ss than a year after the toerk giant made a $13 billion investment in juul for 35% stake, altriaaeo howardlard said on t earnings call thahaha 5% estment is now worth less. >> while we had a range of scenarios making our investment in juul we did not anticipate in amatic a change in the e-vapor category. certainly the lg injury i think was something we had not predicted. and -- and the pretty dramatic potential, regulory change. >> today the cdc announcing 37 people died from vaichg related tilzs there more than raft week week. h illness numbers climbing to 1,900, a more than 17% increase. bothhe fda and cdc continue to chemical aalgressional f the ep leaders push for a ban on all

flored vaping products. >> it's so important that we put is in effect asap to prevent more kids pr vaping. illinois representative raja crediting that morpgty led wrote a letter to the white house to enact t flavor band proposed in september. >> i>>s disturbing to know that a company would in the first place sell such products. and then secondly, continue to do the thing went uncovered investigation. going into schools, paying high school disicts and other schools and going in t present the products as safer than they are. >> the writedown getting mixed reaction from analyst processes. onfferiy says the juul impairment sayay was not wisely invest, furthermore with cigarette share facing headwinds it looks like the pressuredmains howeve christopher grove from stifel wrote the write downfrom

juul was anticipated in the stock price from our view and more we continue with the why rating. altria says it expects profi from 2020 to 2022 tonac id by juul as well as the continued decline in cigarette sales. for "nightly business report," franke haaland. >> duncan brands bets on the new men yu.re that's w we begin the market focus. >> the restaurant chain topped earnings expectations but fell short on reven.s. sales helped by strong demand for premium breakfa sdwiches and peshl specialty cofes raising the i you will-year guidance looking to introduce new menu items beyond meat breakfast sandwiches. shares he is rose more than 6% to 68.72. universal display quarterly r relatesults beat analyst expectations. the key supplier for apple says it saw strength on a global sali and will revenue guidance. shares rose more than 15% t 218. kraft heinz reported better than

expected profits thanks to low costs. the food company also said it's looking to increase marketing for its flagship brands whose major procts cluz ketchup and velveta cheese.th e shares climbed 13.5% to 32.33. and rolling power blackouts in california helped demd more jenner ac generators as the company topped analyst estimates. ac raised guidance. the stock up more than 4% to 96.58. after the bell pirts missed revenue expectations. but the image sharing site did see growth in global monthly activeve users but the revenue miss st shares down initially down more than 15% after hours. closingg the regulation session down about3% to 25.14. the house passed a resolution formallyizing the impeachment inquiry againstru president. in establishing a road map of the process and makes it more bl . and w wle this isoing on, the

deadline to fund and not shutdown the government is rapidly approaching. ylan mui h more on this collision course. >> the atmosphere was charged after hse democratsoted to formalize the impeachment investigation into present trump. >> we take no joyon having move down this road and proceed with the ieach president inquiry.he but ne do we shrink from. >> every singl republican rejd the the impeachment if. >> it includepen hearing with new witnesses the intelligence committee putting to a fin f report and the judiciary mendota eystading whether to move forward with articles of impeachment. it will be a bitter and partisan fight. but amid all of that, republicans andemocrats will have to find a way to work together to keep the lightsn in washington and prevent another government shutdown. >> weeed to fund the government every year. and congress and the president

will always find an excuse to kick the can on the deadline. so we have to -- we have to be able to walk and chew gum at the same time. there are just eight working days left in the house before the government runs out of month on november 21se hopeaker nancy pelosi and senate majority leader mitch mccoell spoke about this earlier this week. but today mcconnell accused de crats of maying p pitics particularly with funding for the military. >> the core messagear here is to miss. our democratic cleague haves a priority list picking fightht with the white house is priority number one. number one. and our men and women in uniform fall somewhat further down. >> democrats say there is no time line for the impeachment investigation just yet. and they're committ to funding the government. but there is a broad expect aches that congress will have to to a stopgap spending measure and kick the can down the road once again. for nightly business report, i'm

ylan mui in washingtonen >> politics at the forephone for social media. we told you last night that twitter said it will ban platticking ads from the rm. as julia boorstin tells us that stance in stark contrast to facebook's stance. >> at the same moment fis er released earningsng wednesday afrnoon, jack doorsy tweeted at he is banning all political and issuero ads twitter to stop the spread of misinformation. tweeting qb quote, a political message earns rch when people decide to follow an account or retwreet. paying for reach removes that decision. allowing highlily opt myselfe targeted adds on peopl political adz ce a tiny% of revenue generate atntion $3 million during the midterm elections. and the company says it doe't imct guidance for fourth eearter. fresh on the h of doorsy's

nounsment mark zuckeederg defe the his decision to run political ads on the facebook platform and not fact check them. zuckerberg saying in the earnings call that political ads are key for free speech. >> we estimate the ads fromli cians will be less than 0.5% of revenue next year. i that'so not why we're doing this. the ftc fine the same critic the said wouldn't be enough to change the incentive was 10 x big are than this. e reality is we believe deeply that political speech is impoant and that's driving this. >> a lot of reaction in washington, d.c. to twitter's new policy. with the trump campaign blasting the decision. calling it get yet anoth attempt to silence conservatives. amy dential candidate klobuchar pointing to lack of consistent policies across social media as evidence of the ed for regulation. but twitter has its defenders including hillary clinton and congresswoman alexandria occasion owe cortes. they say dorsehe making right

call. 'sis overshadowing the headline about facebo better than expected results. beating expectations across nancial metrics grew users faster than expected and guidance better than analyst projections for nightly business report, julia boorstin in l angeles. coming up, an investment stragy to help prevent wildfires. li the one in california. ♪ ♪ ♪ ♪ in addition to the fires that have been burning, a new blaze has firefighters battling a wind-dven wildfire in san bernardinoalornia. zroigs six homes and two outbablding 500 homes evacted. it's burning east of los

angeles. and hotter, dryer weather with overgrown forests have contributed to the most desttoctive fires in h in just the past few years. now there is a new strategeg to prevent these fires that has investors piling in. diana olick explains in t latest the installment of the series on the rising risk to real estate. >> as wildfires now rip through thousands of acres of california real estate on the heels of record setting destruction last year, a uque financial strategy to prevent such fires is underway in nearby thoe national forest. a bond that provides immediate mucheeded funding for fast restoration of the now overly dense, dry and dangerous forests. >> i see a beautiful orest in front of me. what do you see out there. >> it'sea strikinglyiful. but what we really have right now is an overstocked forest. >> zach knight is managing partner of the non-profit blue forest conservation and the

brains behind the first of iki bond. >> it's really a public private partnership where we ve gaged investors like pension plans smurns companies, to help cover the up-front costs of doing this needed forestat restorn work with the primary goal o o reducing risk f catastroph>> wildfire. here is how it works. investors buynto the bond. in this case, a $4 million loan held by blue forest giving the mone to contractors who do the forest thinning. shefrai investorings are back ov five4% years with interest by those bifurcating from the work and have contracted with blue forest like the forest service. yuba water ions a whose reservoirs receive water from the forest. upstream that you're water comes from we care about the quality of the water from the for zbleeft he says it's wor it for yuba to pay a littl bit more over time because of the invaluable benefit of goating the work done now. >> the need for funds is

immediate. we have a longer summer season or shorter wet seaso and we have significant north winds in effect of climate change. we need to to do something now. >> ty can't rely on funds from the forest service anymore because the service is spending f more nan he budget fighting fires. and climate change could push that >> it creates this vicious cycle we spend all the money to fight fireing money away from the preventative work that could stop the fires in the first placng >> the dri force behind this is an increasesing popular type esting called esg environmental social and govern. sens vechg for the greater good. buying into the health of the forest but making mone >> our investors are looking for impact and a financial return. and this is off the charts wn you look at what it's givin back. >> jennifer price says herer investors want to align capital with their values. and fighting the effects of climate change is number one on

their agenda. >> it's a bit harder i do find for people to buy into at times, preventing rather than mitigating and taking it away or opping but we prevent it from even happeng. >> the greatest risk she says is if they don't do more bonds like this one. >> because in transaction isn't recommendndicated or if there isn't other funds allocated to do the forest clearing, the forest fires can still fra >> nightly business report, diana olick in thoe, national for zbleeft before we go another from wall et.ay's fin numbers the dow fell 140 points. hee nasdaq dropped 11 and the s&p 500 was off 9. for the month all of the averag u were and that is nightly business forsue herera thank joining us. have have a great evening. we'll see you tomorrow. ♪ ♪

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laura: