this is "nightly business report" with bill griffit and sue herrera. >> get ag .trip the dow now and the s&p 500 all closed atrecords. investors start the week in rally mode. >>bruptive departure,he ceo who led mcdonalds turn around is fired and leading investors to ask what is next? >> underinvestigation. under armoronfirms a probe into the accounting practices raising a lot of questions and offering few answer those stories and more on "nightly business report" for monday, november 4th. and we do bid you a good welcome. everyone. ing like a hat trick of records to start week. the three mainlior averages all closed at all time highs today than largely to reports of

progress in the trade talks with chin and increasing confidence in economic growth. so let's right to the numbers for this day with the w jones industrial avera risiri 114 points today to close at 27,462. nasdaq added 46. bob pisani takes a closer look at what is driving the market higher. >> stocks broke new ground today n the back of high hopes for u.s.-china trade deal with the dow jones industrial average finally joining the s&p 500 and th nasdaq in the record high club. the s&p 500 is i breakout mode, now on pace for the best year since 2013. up 22%% hitting historic highs n several days in a row. what are the factors fueling the surge? have trade optimism which believe wil help the global earnings situation. secondly, the federal reserve which the market still belves standseady to act if the economy worsens. but the fact is we haveha alrea slightly better economic data in the u.s., europe, and in china tcently.

andt's causing some experts to s maybe we need toat re-eva the growth and earnings landscape in 2020 and raise the numbers a little bit. ther he been some promising signs of rotation in the market including breakouts among the cyclical stockstech, financials, industrials. all hitting new highs. the dow's rally comes despite a large drag from mcdonald's following the fire of steve esth easter bs brorm da france, y, italy, ireland, all hit new 52-week highs. japan also 52-week highs. asor the month of november, usually the second best month for the stork markck market for year and it starts the best six-nth perioer when t stock market historically had outperformed between now and the end of april. for nightly business report, bob pisani at the new york stock exchan >> and when the market is at new highs, some say it's time to re-evaluate investor appetite

for riction. one way to do that is by looking at the recent performancef one time stock darlings. mike santelli did just that and teldz tells us what he found. >> the hottest upstart chnology companies had been tramp willed in theresh record highs. a group of heavily hyped and fast growing e-commerce players including food delivery portal grubhub, on line furniture retailer wayfair and etsy had shares crushed losing between 35% and 60% from their peak values.ec now while thet bout of weakness came in response to disappointing quarterly result the action does reflect a broader reckonning forne bues to revolutionize consumer behavior but failing to prove they can do so prosrously. none of the above companies hav shown the sort of reliable generous profit margins of pure technology businesses. just because thehe operate corough an app doesn't mean they enjoy software emics. they're saddled with the cost of

real world delivery and many well financed competitors. now the challenges only underscore the vast advantages held by the likes of amazon with the massive scale and vast prime subscriber base. the poor performance of ub eaeuber and lyft reflect investors inwillingneses to endorse silicn valley's growth at any cost ephilosophy. uestion now zshgs all this amount to an emerging crack in investor risk appetites or the willingness to say this is a sign of underlying resilience in the insex is at record highs and for now.ength at least for nightly business report, i'm mike san thole. >> as bob pisanine ment the ceo of mcdonond's is out. steve easterbrook was let go because he violated company

policy. o the stock fel that news and now the company enters a new chapter with a new leadloer fac leader who faces new charges. >> a major change at mcdoevld's. easterbrook is out as sikh as demonstrating poor judgement in having a consensual relationship with an eeempl he succeeded by m cdonald'susa president. easterbrook is also off the board of directors. in a memo to employees, oo easter said this was a mistake. given the values of the company, i agree with the board that it is time for me to move on. yond this i hope you can respect my desire to maintain my easterbrook took over in march of 2015 helping to reinvigorate the brand introducing new value and all day breakfast. most importantly, easterbrook incorporated technology into hdonald's w self order kiosks, drive throughs and m modernized stores and they made

investments ts past yr to build on this momentum. his replacement has been with mcdonald since 2015. brought in by easterbrook and recently running the u.s. business working closely with easterbrook. me of steve easterbrook.rerends he has been a big supporter of the technology and delivery t initiatit the company embarked on. and also key with the fresh beef rollout the company has been undergoing. in a lot of ways, i think he was the obvus heir apparent. >> he facesng a challen space.nment in the fast food mcdonald's recently reported disappointing earnings and the chain is up against intense competition from players like chipotle, burger king and others. operating officer departed as ef well. mcdonald's declined to comment further. r "nightly business report," i'm kate rogers. >> one more ps, mcdonald's seld

that sterbrook is eligible for six months of severance pay. >> so what does it mean to you as a shareholder when a sikh makes a suddenepture? eric gordon joins us, a professor at the law school of business to talk mout this. . good to see you again, eric. >> hello, sue. >> let's sta o first wall what an investor -- what questions should an investor be asking about this situation when a ceo departs. >> the first thing they should ask i who is going to be the new ceo? onald's we know they auns noed it right away. whoyou want to find out that is. if there is an interim, you're going to be even more worried as an investors. once you know who the ceo is, you want to find out is this ceo going to makak big changes or stay thew course? o you think about them? sort of fate goes with t new ceo. so thahis the first i woul ask: >> you know,ist just seems lately there haveeen a whole slsl of ceos who have left their

companies rher abruptly. what do you think is going on here? >> you know, i think it's a tough time. the demands for performance on the job are high and on top of that, the demands for your personal conduct are higher. >> right. >> you ow, we shifted from i think a long era of wink-wink, nod, nod, well it's personal. it's - it doesn't affect the company to you know pulling out doesect the company.aying it the reputation is very important to vestors. it's very important to customers. and i think there are a lot of ceee who have in whatever business they're in for a long time who haven't caught on. >> does it matter if it's a superstar ceo or one that has just been exacting change in in a more quiet way? do the same parameters you >> you know, you hope they would. but you often wonder if the

superstars just like superstars in thehe nfl get a different dew althou have seen a couple of them, you know, have even the superstars have fallen. easterbrook was very well respecte he did a very good job there. and i think the message from mcdonald's is even if you are a superstar, even ifestors like you, you've got to act right. >> we spe m th time on ceos anyway, eric? contribution.to minimize their it ctainly can be great in many cases. but, you know, the ceos ofd intl ome other big technology giants have been changing hands. w we've got easterbrook and mcdold's,he largest fast food chain in the land. are we spending too much time on their contribution do you think? >> yeah. sometimes i think so. i mean, there are thousands of peopleopho have to doht the r things. there is usually a lot of executives near the top.

the idea of the ceo as the hero, of course that is partly justifies their pay. fwh t bus idea that they're the hero and if it they leave we're in real trouble is, i think, you know, about two-trds myth. >> on that note, eric gorthn he university of michigan's law school of business, thank you, eric. >> my pleasure, sue. > well mcdonald's was not the only surprise for investors today.rm unde this morning confirmed reports it has been the subject of a federal probe intots accounting practitions, one that's been going on for more than two years. the company also lowered the revenue guidance as well. the resul was a 18% decline in that stock. courtney reagan has more. >> news of investigations into in are armour accounting t overshad results. the department of jess and the sec have been investiga ng the accounting practices as it is recognized and whether rev ue

knee noou w. >>: knrevenue was shifted from one side to the other. the only executive thatd addreshe situation restated the company's position with similar language multiple times. >>e can certainly apprereate that yououike us to provide more detailsng regarhat matter. however, we are prohibited from doing so. that sai the most important message i think to convey is that we firmly believe that our accounting practices andlo di shurdz were entirely appropriate and we've beenn cooperating for 2 1/2 years on this. >> who is prohibiting them and why? we want to know why we're o findin about it now and not a while ago. and, you know, transrency is ways gi thing. >> under armor acknowledged the two plus year investigations after the news broke. >> hard to assess just over, you know, one night what is happened. but that is quite a long time for this investigation t still continuing. >> here is what we do know. documents were first requeheed

by government in july of .017. there were three different chief financial officers from 2016 to 2017 and under armour's sales growth began toecline in late 2016. last mow under armour founder and ceo would move to executive xla chairman and chief.oi friskd the company in july 2017. around the time theg account investigation began. north american sales fell again in the quarter reported today. some analysts are expressing concern about how to evaluate even the lesshan stellar numbers that have been provided. >> i think it's difficult externally with their public reports tor assess whether not, you know, the numbers have been accounted for appropriately. >> it's a verymall board. often these are founder dominated boards like you see ii n valley. kevin is not stepping aside the

january isst. i think he needs toesign now. >> the investigation believing some to suggest it's time to clea house rather than it's protect th house slogan. for "nightly business report," i'm courtney reagan. still ahead, a tri to the rust belt to see what manufacturers and workers make of their changing indust. new orderss for u.s. made f goodl more than expected in september. according to the commercert dent, factory orders were down .6%. the report also showed that businessing was slightly weeker than initially thought. theow wn in

manufacturing is due in part to slower global growth. b and that'ng felt by factory ners and workers in the rust belt. we went to pennsylvania, ohio, d wisconsin to get their perspective. shis graphite machine shop in pennsylvania isll summing and sawing butha quieter it ed to be. >> what about the people that used toervice these? >>orhey're notng here anymore. >> how many were there? >> we have over -- about six people have been l off. >> that's 15% fewer workers at this metalshich makes parts for industrial companies, a third of the machines ar i'ded. >> you like to replace machines >> that's partly due to $3 g. million in sayerivesbeosts use customers are buying less. the founder says it's impacting his company and also the state at large. >> a year back thathe manufacturing recession, recession strengthen in this ar

started. stern pennsylvania lost pretty big chunk of workforce. >> that trend is erging across the rust belt. a once blue corridor of heavy industry won over by president trump's manufacturing friendly message. >> we've now gainedearly 10 thoi thou new factories under my administration. >> the swing states have lost 25,000 vakt factory jobs this year:that is largely thanks to major multinational companies exposed to the slowdo overseas and their weakness is spilling over. u.s. manufacturing activity declining f three straight months with a sharper slowdown in the midwehe order backlogs are touching financial in wisconsin, a church metal spinning, the to do lists geing shorter. >> january and through may this s completely full. like i couldn't even write

anymore. now it toned down a little bit. >> george makes components for engineses, plastic molds and playgrounds. the president says he is still investing for the long haul. >> i think there is still someo mism among pple like me out there that it will be a blip. >> but there is some impact now. >> our quarterly bonuses are lower than they were. people aren'tecsarily getting 45, 50, 55 hours of work per weekwe so their overtime is down. >> in ohio, he is furloughing workers for f one week every >> they're not buy houses. they're not buying trks. they're not buying newables. they're looking at future is. >> bob harper's lobbying lawmakers for the steel workers he represents in stark county, ohio, where voters swung for trump in 2016 after threeec elons backing democrats. harper says bas onhe economy, it may well swing back. promised tohe's us is not there.

you know? i saw he went after the midwest and the rust belt, ohio, wisconsin, michigan and all that. not working. >> the white house did not respond to a request for comment. the trump reelection campaign pointed to the number of net new mafacturing jobs creatth in u.s. since 2017. but did not address the recentn declinewing states. but the recent travel schedules of mr. trump aice president mike pence suggest outreach to voters in the rust belt rains imperave. for "nightly business report," i'm in washington. >> now manufacturing represeres only about 12% of our economy decline. share continues to et does does do the name finaial conversations on wall reet. why does it get all of this attention? joining usonight, cistopher smart, chief global strategist and head of bearings investment institute. good for joining us tonight. >> nice to be here. >> what do you make of this? it gets a lot of the attention

butt yet is a much smaller share of our economic output than it was a generation ago. it's it been declining really since the end of world war ii as a share of the u.s. trkforce. nk it's a lot of attention on wall street these days because there is so much attention right nown the u.s consumer driving the u.s. economy even as many manufacturingaks showing ss. kf the jobs picture still look bright for much longer? the py,itical st of urse, is because so much of manufacturing i concentrated in many cases in smaller towns and so when the is a decline or factory closing, the political impact is very sconce traited, very painful and hard to

reverse. >> you also make the point that ng jobs aretu better paid and that has a much the various communities that those plants are loced in. >> well, it has a spillover effe throuout the economy. i think because when you are making car ortruck, youave a lot of inputs of steel and other components. you need a lot of tractor-trailer. that has great spillover effects throughout the economy. these are jobs that are better pa than their comparable jobs in the services sect v. ity important part of our exports globally in the united states. and it drives innovation in many ways. so a manufacturing job isn't just the same as another part -- another job in ano part of the economy. >> let's face it mshgs of the manufactinnu jobs that kayla was pointing to are in swing states in thiscountry. that might also answer why they get so much attention, right?

>> generally if you're an economist, you look at averages. if you're a politician, everything is local. and theocal pain that comes from a factory closing down is very real and very difficult to reverse. and that's somgohing that's g to get attention. >> christopher smart with bearings institute. ank you for joining us night, chris. >> my pleasure. health posted higher revenue for the first time in three quarters. that's where we begin tonight's market focus. the drug maker known as valiant reported better tha expected growte driven by strong and the bausch & lomb division as well as increased demand in the unit that sells gastrointestinal treatments. the shares were up 1% to $26.19. ganette saw the digital marking services grow bull sales declined. as a result, the company missed on revenue targets and lowered the guidance.

this companies as they're awaiting shareholder approvalvao be acquired by new media investmentroup for nearl $1.5 billion and that would combine the two largest the shares were a fraction ntry. to $10.71. after the bell,online c consignment the real real reported better than expected results. shares were initially volat in the after hours on that today they closed the regular session down more than 5% to $21.73. also after the bell, marriott posted mixed results missing on wall street's earningss estimats but it did top revenue expectations. the hotel operator said they were impacted by those miss protests in hong kong and b unfavorable foreign exchange markets.ia shares were iny volatile in after hours. they closed the regular session up more than 1.5% to $130.16. finally, uber missed analyst expections for mnsthly active users.

the ride shang company did st a beat in quarterly revenue. the losses for the quarter topped $1 billion. and shares initially fell following the after hour bell tonight. they closed the regular session down a fraction at $31.08. coming up, turbo charged rnings, a look inside ferrari's secret profit engine. apple is spending $25 billion to address the affordable housing crisis in silicon valley. in a blog post, tim cook said

his company has a civic responsibility to ensure the region remains a vibrant community. california grofrn said that building more affordable homes isne way to address the sky high cost of housing. something that hasto contribute he spike in homelessness in that area as well. >> saudi arabia's statewned oil producer announced plans over the weekend to gopublic. the ipo of saudi ramco could be the largesttock offering ever. trading is expected to begin on the saudi stock exchge. while f details were available, bankers have told the saudi government that mainvesto value theompany at about .5 trillion. finally tonight, ferrari said tonight the earnings are cing ahea the luxury automaker reported a solid quarter. it topped profit andevenue estimates. it also rsed it full year outlook. thanks to anin increasehicle shipments. that helped lift that stock by 5%. the legendary sportscar maker is also making money from an

operation that few people know about. here's robert frank. >> for today's wealthy, buying a ferrari is not special enough. they want a ferrari thari is mae just for them. which is why ferrari's profits are sring with help from its customization program.th are on strong earnings apr it margins of 34%, numbers more typical of luxury handbag makers rather than car companies. a big driviv is the m where cus an extra $10000 or more to customize their ride. they spe half a day in the special ferrari design center with a personal designericking out their own fabrics, wheel treatments, metal finishes, stitching reads, brake calipers and shifting paddles. you can even have their names inscribed in the interior and create one of a kind paint colors which are schethen displ on rrari's color wall. >> customization is it extremely

important to increase the customer satisfaction. h's a way to engage clits and having thempy and coming back again. >> wealth alone can't get you a taylor madeferrari. you have to apply and get accepted. ferrari only makes about 200 taylor made carsear out of a total production of 9,000. the company won'tha say qualifications are but it typically goes to customers who ferraris. dy purchased the ferrari had two taylor made studios, one in italy whe they're based and the other in shanghai but they were so ovtbooked that they j opened a third in manhattan where w got an exclusive tour. i tried my hand at catg a customized version of their lateston model, the 812 gtshich starts at $398,000. by the time i added a special blue paint, racing stripe, red ses and a special badge with my name inscribed, the price was a halfas million. what you eaver said no to? >> several time.

we will to sayno. let's sayhat if the color is a pink color with cartoons on the shield of the car, on the caret that is sng we don't want to do. >> proof that at least when it comes to ferri, money can't ways buy you everything. for "nightly business report," i'm robert frank. before we go, here's a look at the day's numbers on wall street. record close. the dow was up 114 points nasdaq added 46. s&p 500 gained 11. and that is "nightly businessreport" for tonight. i'm sue herrera. welcome back. >> thank you. i'm bill griffith. have a great evening. see you tomorr.

narrator: funding for this presentatatn is made possible by... woman: babbel, a language a that teaches realinife conversations new language, like spanish, french, german, italian anmore. babbel's 10 to 15 miete lessons are availa as an app or online. reelnformation on baom. narrator: funding was also provided by... e freeman foundation. by judy and peter blum-kovler foundation.. pursuing solutions for america's neglglted needs. and hi contributions topbs station from viewers like you, thank you. woman: and now, bbc worlwonews.