exchange. ♪ this is "nightly business report" with sue herera and bill griffeth. market anxiety, a new report tonight puts a phase 1 trade deal with china in tout. and stocks get knocked. >> in the bull's-eye, target blows past estimates and raises profitas forects at a critical time of the year for the big box retailer. supplying up prices, the of single family homes is shrinking, meaning renting just those stori and much more tonight on "nightly business report" for rwednesday, novem 20th. good evening, everyone. d welcome. if you needed a reminder that trade, today got it. about the market got the wind knocked out of it on a report that the first phase of a trade deal between the u.s. and china may

not be completed by the end of the yr. uncertainty around trade also grew after the senate passed a bill supporting the hong kong protesters. the house passed a similar bill tonight. an today the dow jones points to 27821.ge fell 112 and the s&p 500 slipped 11. bob pisani looks at how a reported stall in trade talks stalled the market. >> it was a rocky day of trading on wall soceet. starting lower then taking a deeper plunge midday as trade fierce came out again. trade sources say phase 1 of a u.s. trade deal may not be kmeeted this year and could slide to next ar,s beijing presses for tariff rolebacks ase the white h wants a deal addressing intellectual property, technology transfer issues and the two sides can't seemo agree. if the market believes that tech really are big contions of a

that is a road block for betting bigger deals. any deal we get could be more than can see keyes kind of a phase one light. no new tariffs on december 15th, thefs existing tarif remain in place and maybe some agreement for the chinese to buy agricultural goods. phase one 1 essentially. the worst-case scenario would be no deal at all as tariffs in place and then maybe a heap december.riffs coming in in no surprise we saw trade sensitive names like materials and industrial tech, semis all slipping. apple was down more than 1%. up until today the market had been fairly complacent frankly with very narrow trading range the last few weeks low volatility, optimism, broad based november rally. but the mooded shis investors try toigure out whether the markets can avoid the selloff into 2020. more "nightly business report," bob miss in at the yk stock exchange. > and there was a bright spot for the markets today.

it was in retail. yes, retail. target stock took a vtory lap after reported better than expected earnings in revenue and raised profit guidance. the shares soaring by 14% to th- alme high. courtney reagan looks at what target is still doing right. >> target hits another bull's-eye with the quarterly results. the combination of strong store traffic andin o sales drove total kprabls sales u 4.5%. the big box retailer says says the strategy tose theetwork to fulfill online orders, the same day order fulfillment services made up 83% of the digital comparable sales growth. >> when it's order online or pickup in store or drive up or fulfill by sp by 90% of the cost goes away. the economics look a lot like storenomics. and we certainly like that. >> during the upcoming holiday season, shoppers used t pickup services even more. target saw strength in many

categories, including apparel. the apparel and accessories business grew 10% in the quarter compared to last year. apparel weak for other competitors this quarter, including kohl's and wal-mart. >> i really do think that their private brands have been superior in tms of quality plus value. all right. and i think that the customer really finds that to be distinct and unique to target's offering. >> food is another area that target has seen improv while only about 2 of the sales are in that area, much less than wal-mart 5 a%, it's important traffic driver. >> the food business is just gaining traction, i think. food was spot on.strategy w we thought they needed to do it earlier. they didn't. food drives traffic. private label brands around th home and apparel side. in thee traffic comes stores and on the website you have more to sell in the higher margin. >> the big test of course starts next we canri with blacky

nine days away. but target ceo brianon cl is confident and said all indicators suggests in a sol holiday season goo. >> for "nightly business report" i'm courtney rayingen. >> lowe's reported higher profit beating analyst expectations. the ceo cited a solid macroeconomic backdrop calming nerves after the rocky report yesterday. the home improve retailer said fewer dists helped lift rgins and newer products attracted builders and contractors. the stock gained almost 4% in the trading son today. arl icahn is betting against mall owners. according to the "wall street urnal," the billionaire activist investor is thet larget sh seller of mall debt. he stands to make millions if owners are unable to pay of debts. the news sent shares of major mall owners and real estate investment trusts lower in the day's trade.

as mall orions strugwell debt and declining traffic, he former ceo of macy's says there are too many stores. >> there is too much retail space in the united statth. e is way too much retail space. this this has been a problem a long time but the bubble burst when the online business started aggressively growing. thinkbout it thi way, 20% of the businesses of apparel business now sol online well 20% of the stores haven't gone away. and the total pie isn'tinrowing. some has to give. >> greg portel joins us to talk about the state of the retail astray from malls to store closures and real estate the lead partner at at carney thank you for joining u >> thank you. >> i'm mindful more than 9,000 stores close this year alone, a record. and somody like the former head of macy easterry lund green believes we are overstored by 20%. how risky does the bet against

look right now?is it risky at a think. >> well, there is no secret thae u.s. has been overstored for quite a while, that the challenge becom when do we hit the cliff? because it's no secret that things will be moving around, consumer shopping in different locations. store closures by themselves heally aren't problem. it's the combination of multichannel sales, distribution points and a lot of other ways that retailer are using the stores that really needs to faor into the conversatiof being overstored. >> but those issues that you just mentioned aren't going away certainly. they're only going to probably crease. so you said when we hit the cliff. when is that, do you think? what's your gut sense?'t >> we d see it happening any time soon. we have a reil environment where stores have -- retailers in general haveoverinvested and overindexed toward building

digital capabities rightt the time. >> um-hum. >> now we go backhe other way where we see aap in spending on store improvements. we estimate about $100 billion worth of investment is needed in the retail physical space to meet the expectations of consumers going forward. whether that's less s footage or not, it's still an investment in the physical space of retail. >> but what about malls themselves, especially when you consider that their biggest anchor tenants are those departmentt stores te suffering so much right now? what about the future of malls in america do you >>think. ell it's easy to group malls as a single unit. but it's a bit of a mistake, because malls need to be where shoppers like to go, where traffic is. so malls that find themselves in high-traffic high-volume as to malls thaare appealing to go to we think about the mall from t 70s it looked like a military bunker.

that doesn't draw consumers in today. they needgh , space, activities, multiple uses. thels m there will be fine. the malls in isolate areas where the traffic mov away or consumers shted from will strug zblool greg with at carney thanks for>> joining us. hank you. elsewhere, the federal reserve today released the minutes of the last meeting. where policy makers lowered interest rates by 0.25%. and many saw little need for further cutre hes steve liesman. >> after fed officials cut rates in october minutesrom the meeting then show they expected to stop cutting and remain on hoome period of time. the minutes show foernls thought after a 25 basis points cut, the third of the year, the rates were seen as well calibrated to deliver moderate urowth and continued strong labor market. most said the overnighttrunds rate cled by the fed in the new rage of 1.5 to 19.75%

was likely to remain appropriate less the econo performed materially differently from the expectations. saw a lower cnce of recession and risks to the economy kpl developments declined. u.s. economy was called resilient and twoed'tfficials diant to cut at all. but they cut because of manufacturing and export weakness sparked b the trade war appear weak globa economies arket drag down the labor and the consumer. officials outright called it an insurance cut now after three rate cuts they were clear in the minnesota and speeches suns rates have stopped going down through the end of this year and likely flew a good chunk of . for "nightly business report" i'm steve liesman in washington rchlt like a to loo some of today's upgrades and downgrades. beginning with kohl's. downdwraded to neutral from buy the analyst citing fading confidence in the retailer's stratespc initiativeially

after yesterday's disappointing earnings report. ice target now $48. despite the downgrade any rosefa ture sthun to 227.42 in my a day after falling 19%.no growth upgraded to buy from neutral at bank of america merrill lynch they cited valuation after a 60% stock over the lastix months. price target is now $19. the stock was up 15%. also probablies because the house judiciary committee today passed a bill lifting the federal been on marijuana sales. that's the first step in that process. johns & johnson was given an overweight rating in new coverage at canter fitzgerald. the analystited growth in the pharma business and said the liabilities from opioid and talc litigation is manageable. price target is $160. the stock up a fraction to $1354. sti ahead, the are drivers ready to plug in.

>>? auto show you see them,lectric vees. there is a we have of them coming. dyt is the public r here in the u.s. to b evs? i'm phil lebeau? that story coming up n "nightly bu oil prices reverses two d of losses today after a new report showed a smaller than expected build in u.s. inventories. the crude market was also supported by comments from russian president putin who said russia will continue to cooperate with opec production decisions. domestic crude settled up 3% to

ckup $57 a barrel. apple breck ground on its $1 billthn-dollar facility in n austin today. the new campus is expected to open in 2022 with five thousand employees. the announcement contaminate on the same day that ceo tim took toured the manufacturing plant with president trump. the campus is going t expand apple's austin operations which currently build the new mack pro. ten democratic hopefuls are taking t stage in atlanta tonight for the fifth debate. and there willotikely be a of talk about policies related to the economy and business. john harwood joins from us the site. john starting wi health care the previous democrat debates revolved around medicare for all and tns privateance industry. do you think tonight's debate will? >> well, think it's going to be something different about it tonight, sue. and that is elizabeth warren has taken the pitical risk of saying how she would pay the enormous costs of medicare tor

all, wando it with an increase in the wealth tax she already proposed with some other tax increases thrown in as well. think that's going tohift the terms of the debate, broaden it from whether onot you can get rid ofhe private insurance backers want, but whether the economy can tolerate and whether politically they can pass tax increases ofhe scale she isab talkingt. >> speaking of elizabethren how do you think the candidates handle the issue o her public arguments with billionaires, people likelien kupperman. >> i think no democratic candidate is going to defend the feelings ofilonaires. however some other candidates like joe biden are going to say we can't divide the country. we can't be punitive. we heard that from brko o'r before he dropped out in the previous debate. we need to bring the country together, cast themselves as more moderate, broadly acceptable.i think we hear that not just joe biden but also from pete buttigieg. >> and speaking of which he is a

candidate who has really surged since the last debate. kat do wew about his wesiness in economic views? >> , pete buttigieg is now leading in iowa, new hampshire. he has come on, cast himself as a moderate. he is hing to inherit joe biden's support if he falls. he has proposedo reverse the corporate tax cut take it back to 35% to pay for hisca health plan and talked about potentially a financial transaction tax, an car tax, kind, hasn't s it out we see if he does that tonight. you can bet because of then rising positn the polls he is taking a lot of incoming fire from other campaigns. >>d, ind john harwood in atlanta for us. thanks, hn. >> you bet. salesforce raises sales outlook. that's where we begin the market focus with the software company ing the higher end of the 2020 revenue guyedens abo

analyst estimates. salesforce shares rose a vac shun to 164.20. shares of altria and phillipot morr rose after bloomberg reported the fda wilend the plan to drastically cut level of nick teen i imputable cigarettes. pack in 2018 any proposed cutting them to non-addictive levels to transition spokemoke torse-cigarettes now the world has change in that regard. altriaose more than 3% to 38.45 frill ip morris up to 43.48. general motors is suing fiat chrysler alleging the fellow auto maker bribed officials at e aoork union in 2011 and 2015 for fiat chryslern to g better wichmann and work practices. gm says the alleged bribery was authorized at the highest levels at fiat chrysler. shares of both auto makers dropped more than 3% inoday's

trade. brit ol myers said a late stage trial test to forkin cancer drugs missed the main goal of preventing curens of in some patients.ed they recommeo kin the trial unchange. shares of bristol myers fell a fraction. pg&e started hut thing off power to 150,000 commerce? nearly 20 california counties to help reduce the risk of wildteres fro exp high winds. the utility says the goal to restore power to the customers is by the end of the day tomorrow. pg&e rose more th 4.5% to 7.15. after thebell, la-z-boy posted earnings missing expect augustss. .if you were tur reiler beat comparable store sales estimates for the company-owned retail segment pmt la-z-boy also raised the quarterly dividend 8%. shares initially fell in after hours tradinghe closing regular session down a frederic shun to 36.18. ao afterhe bell, l brands reported mixed results with earnings in line with

estimates butissed on revenue. the retailer saw a drop in se ore sale especially in its victoria secret unit. but shares initially re following the news but closed the regular session down about 7.5% to 15.89. at this year's l.a. auto show electric vehicles o evs took center stage. a number of new model bei introduced. but the question is is the public ready for the new wave? as you saw, phil lebeau is there. ♪ new electric vehicles will be rolling into showrooms. from t mustang match e to the porsche tican. with so many new ev hsting the mechanic is the public ready for them? even the auto industry executives aren't sure. > first of all, the price is higher, and secondly the question of convenience. >> last year we sold 140,000

electrified vehicles we started 2013 with the 2013 i 3 going forward we have 500,000. in tipping point hard to see. >> it's being p able tovide great cars people like not because they're electric but because they e great cars that happen to be relectric. >>ht now evs make up less than 2% of all eek vehicles sold in the u.s. while there are dozens of new electric vehicles rolling into showrooms over the next five years. evs are expected to make up 10% of the maki by 202 phil lebeau, "nightly business report," los angeles. let'sn t now to rafael to nd out more about demand or electric vehicles and when we could see theales take off. she is at cox automotive mobility focusing on electric lk markets. good to see you welcome. >> thank you, sue. >> what was your imp assion at tho show? and what buzz did you hear about

the evs?on aremers ready to purchase them on a large scale. >> so i think, you know,s consumre really excited about the ev future when we talk to them 7 oh% say they can imagine a fully electrified role in five years. but that's not translating to coideration. only 4% considering. but the auto show proves what the future of ev is looking like. we satisfy see in retail sales t with introductions by pliek the ford mustang match e being a big student. >> i think one of the biggest concerns is the infrastructure in our country for charging stations. there are just a dearth of them. couple of years a number of of them being built around the country. >> i think we're starting to see new partnershiping cominup. but that's definitely an opportunity in the u.s., is th i grow infrastructure. because consumers continue to question battery ranross. until they see charging stations more prevalent at home and near work they have questions about

the range of the vehicles. >> you know, youed menti the fact that consumers are considering it. but what responsibility do the auto makers have t try and dispel some of the fears or perhaps misconceptions about thr infrture. >> i think they are greatest strength is their dealers and empowering them with more in ermation to helpcate consumers. and having more prevailens of elecic vehicles in their advertising will help consumers have the vehicles be topf mind for them. >> ford is planning to have 40 different electric and hybrid mols on the road or at least introduced in the next couple of year are we -- is ther that much demand for those vehicles out >> well, so i think much like phil said, this isut not a it being electric or -- this is about consumer demand and what theyike ifou provide the crossovers and suvs and truck,

hot for consumers they will make the shift t>>electric. ho do you think are the leaders, bill mentioned ford with all the different model but what other auto makers do you think really are cutting edge in the space? >> so i actually talked with vw today. and they have a very bright future when it comes to ev pmt i think that gm has made a strong stan? terms of the electrified future for them asl. w those are brands that you remember consumers know and lo. if they bri more electric vehicles to mechanic they'll be the ones willing to make the switch with. muchochelle thank you so >> thank you. >> with cox automotive nobility. >> coming up with home prices rising, affordability is falling and the same is true when it comes to rentals.

♪ ♪ here a look at what we're watching for tomorrow. existing home sales will tell us what impact mortgage rates are having on the housing market right now. a number of fed officials are scheduled to speak on economy and here come more retail earnings results. this time fromma 's, the gap and nordstrom. and that's what we're watching for thursday. macy'sre website washed in october. the retailer said the incident affected mall number of macy's.com customers during a with-week period. the customer information exposed includes names, addresses, phone numbers, email addresses and credit card numbers. >> finally residential housing market in most parts othe country has frustratinged as inventory is low, prices high, now also a potential for

shortage of affordable single family rental homes because demand is hotter than ever. diana olick explains. >> anyone out shopping for an entry levelwsome kno the prices are high and the picking are slim. nowhe same is holding true for cans findas more ame it harder to afford a home rental demand is soaring.pe ally for single family homes. kimberly is both a real estate agent and landlord. and she has seenen the d.c. rental market take off. >> it' more of a millennial thing in that they have the income available for higheres pr on single family detached homes and may have tried a pa kondo, ament but now they want outdoor space and they have the disposable income to u it. >> the suppl of rental homes is shrinking nationally. in the third quarter of t year single family vacancicies at ow 6.8%from 7.1% a year ago. splay is much lower on the low

end. so rent t pricere are increasing most, up 4% annually in september. higher end rents up less. but in the hottest marketsike phoenix, las vegas and seattle rents are soaring. >> rents are not going down. i have seen consistent growth ar after year. and single famil markets in particular. people want that experience of having a yard, having enough bedrooms and baths. and i have seen increasing inconsistent every >> the number of single family homes available foress than $1250 per month has dropped 40% e 2013, according to capital econom ds. all thisespite the fact that the single family rental market ballooned during the foreclosure crisis. investors paut us thougf diszris he issed home growing the rental spli by 36% between 2012 and . >> most thought that they would sell theouses for a profit a call it day. but the rental market is too

lucrativ so more investors are buying more properties. for "ghtlbusiness report" i'm diana ol zbliek another look at the final numbers on wall street. the dow fell 112 points. the nasdaq down 43. pped 11.apnea fiefd s and that is "nightly business report" for tonight. i'm sue herera f thanks joining us. >> i'm bill griffeth. have a great evening. e you tomorrow. ♪ ♪

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