>> announcer:is thi "nightly business report" with sue herera appear bill griffeth. flexing its muscle. th m stockket extends its record on new signs the economy is strengthening. >> from bad toorse. boeing's troubles mount. but this time it's because thec any launched its new space capsule into the wrong osht. finding, notasy with stocks at new highs. but the market monitor has a list of nimes you might want to conser. those stories and more ton onht "n business report" for this friday, december 20th. e> good evening, every and welcome. bill has the evening off. stocks powered to n t highs finish the week. putting the major averages on track for a blockbuster 2019. the trade truce with china last week put investors in a buying

mood and the buying really hasn't stopped. today positive news on the econom helped lift sentiment. and by the close, the dow jones industrial was up 78 points to 28,455. the nasdaq rose 37, the 37th and the s&p 500 added 15. all major averages were higher for the week. the economy appears to be regaining some of its footing. today we learned household spending rose in november, according to the commerce department personal income increased 0.5% and spending rose 0.4%. economists say the numbers support a strong consumer which habeen driving the economy. and stronger consumer spending helped enomic growth in the third quaer rise 2.1%, helping offset weaker business invement. consumer sentiment rose in december, according to the university of michigan index. consumers are now more optimisticnt about cur and future economic conditions.

into 2020?hateeling extend steve liesman went in search of the answer. when it comes to economic growth americas was feeling a i muc as any time in the past eight years. the cnbc a america sfri interview americans across the nation findst8% f real indications the economy kbroo a lot or somewhat. only 42% say said only a little improvement or none 10% unsure. i want not the highest level that's gauge. it's the lowest level among those saying none or littl growth since the question asked in 2011. like many of the responses when it comes to the economy, it's driven mainly but not entirely partisan views. 77% of republicans say the h econom improved a lot or somewhat. compared to just 28% of democrats. independents in the middle at 44%. for the 2020 tlook, the survey asked is the next year a year

for expansion andpportunity for you and your family or a time to hold back and save because harde times are ahead? 35% took the rosy view of 2020. the highest is since the question was asked going back to 1998. still 55% remained concerned and said they'll be holding back. maybig a of underlying caution when it comes to the economy. just about every demographic is question among those positive republicans those who will spend $1,000 or more for holiday shopping and those thinking now is a goodesime to i in stoc. for "nightly business report," i'm steve liesman. the market may have been up even more todayot if for boeing. shares fell more than 1.5% after a 1-2 punch of negative news. boeing starliner rocket failed a key nasa mission during the first trip to space. more on that just a moment. but weegin with the troubled 7 max.

united pulled the plane from the schedule again. and now the max will n be back in the united fleet until the start of the summer travel season. phil lebeaue.as m wit the grounding of the boeing 737 max expected to stretch several weeks intoext year, united airlines is pushing plane.ans for the another three months so the airline won't fly the plane than southwest and american.ater with max planes set to be grounded for more than a year, cancellations are piling up. in fact, u.s. airlines are now scrapped almost 150,000 max flights. and it could go higher. since the head of thefaa says there is no time line for approving fixes for the troubled plane. as a result boeing is halting max production next month. and so is spiri aerosystems which building the fuselage. at the company plant in wichitaa, kansas there are

already00 max fuselages built but not delivered. meanwhile it's still unclear if ge aviation, building max engines in partnership with a french firm will slow or shut down its engine production. wi the badinews for b and the 737 max finally come to an end in the new yea well it's too soon to tell. but almost everyone grows, the 73max will flygain. the question is when. phil lebeau, "nightly business report," chicago. space is ao o a part boeing's business but which don't focused on it. today we are after its starliner space craft failed on the first launch. morgan brennan at the kennedy space center in florida. >>. >> 15 seconds. >> >> rerter: critical test boeing hopes to end 2019 on a high note. instead, a setback for the >> the starliner itself on its

way to the international space challenge had a challenge. >> the unmannedaunch took place before day break at ce canaveral. >> and liftoff, the rise of starliner and new aera. went according to plan. but the trouble arose after it separate fromd the uni launch alliances atlas 5 rocket. when anutomated timer error prevented it from reaching the osht necessary to meet with the space station. a statement boeing saying tquote, further rause analysis is needed. and that quote, the combine eing and nasa team plan to worth together to define test flight object he was for the o remaindethe mission while preparing the starliner lander. boeing and nasafficials saying if humans had been onboard they would have been safe the whole time that the journey to the space station may have continued planned. something nasa astronaut nicole mann who will be on the starliner crude flight detailed

>> this vehicle is a new level automation we have not seen before. what we are doing is testing that automation. t andt's why you have test pilots onboard for the early missions. that's our job. th we are trained to do. >> still the setback in the boeing defense, space and security business coming during to a tougheek on the commercial side as it halted 737 max productn. with t time line for starliner set to slip further, nasa administrator jim bridenstine says there is no doubt there is financial impact i >> when the a setback obviously that can have a feedback when it comes to maybe ader not being able to win the next wcontract,ther nasa or another commercial company t that wants value for microgravity. that's up the commercial companies to figureout. >> starliner is part of the nas commercial crew program alongside spacex which has another safy test of its own before humans can ride in the

crew cragi capsule. for spacex the first manned flight is expected early next year. as for starliner it's unclear what the next steps will , with the focus on bringing it back to earthnd as soon as . >> it's not a failure. i would say it's certainly that we wanted to see happen. but it's also true that we test for a ren. becausebe we want t able to learn these things that we need to learn so when we do put humans onboard they can be safe. >> for "nightly business report,"en morgan n at the kennedy space center in florida. it's time to lookt some of today's upgrades and downgrades. kjell ob upgraded t buy from neutral at bank of america merrill lynch. the analystit improved sales growth which should help profit is $70.ce targe the smars rose more than 2.5% to $68.64. duncan brands upgraded at guggenheim. the analyst says therepodding of stores help increase sales.

the price target $83. stock up 2% to $74.93. mienl's downgraded to under weight from equal weight at morgan stanleyg cit declining comprables raels and rising compression. the price target is $a. shares of the small cap stock dropped nearly 8% to $6.17. in the meantime something caughtur attention in nike earnings report, yes reported better than expected profit and revenue which we told you about last night. but the company says the michael jordan brand had its first ever billioar quarter. not bad for someone w hasn't played professional basketball in more than 15 years. jabary young is the sports reporter for cnbc.com. welcome. pleasure to have you here. what is is it about the jordan brand that dri it to the record level. >> first of all thanks for having me sitting next to a legend.

i appreciate that. ejord. en brand has a history. it's perfection. i was talking to a prda person representg jordan brand at one time saying they are like disney. ody knows the jordan brand. you walk into stores clubs, langs lost time youk at people's feet, younger people even older they have on a pair of jdans if there is a pair of sneakers. you don't see the other brands as much as you see the jordan brand and nike. i think that history, the perfection, the fact that people know what it >>is. right. i owned a pair of jordans. iood at my closet i got $2,000 of jordan. that's the brand we recognize, a young urban guy from north philly. you gol to schou had a nice pair of jordan you were the man. you got a date everything was fine. listen, the jortden brand, at's what it is, the history, the connected to the culture, connected hiphop culture as long as they uphold that i thing they'll nev anywhere.

it's not surprising any got the billion-dollar qureter. >> comt to the shoe that is steph curry put out or lutron put which were also hot. >> yes. >> but differentiated for for me if you can. >> history. people -- lebron sneaker good. steph curry ispy i love poob touching mieshlg jordan. that's perfection. the difference and is when you sign to the jordan brand as a player. you got to recognize something it's not your it's michael jordans. you the won'te pardon of kawhi leonard now with new balance. you see the other brands come. but they don't have the history, theur cu thempact that jordan has and that's exactly success and will for a long time. >> congratulations to them. >> yes. >> jabay thank you so much. >> appreciate it >> sti ahead bill changes coming for millions of california workers on janry

1st. but it's not entirely clear what the changes ♪ the ukarament is moving forward on a brexit bill. all butan assuring ary exit from the european union. members approved the withdrawal agreement prime minister boris johnson negotiated with the eu iner oct today's action paves the way for britain to leave at the end of next month. a new california l goes into effect on january 1st that could change the way millions of people work. it was designed to protect ig so-called economy employees.

but there could be unintendedue conses for many more living and working in the fifth rgest economy. deedra bosa in san francisco. >> reporter: on january 1st, lifornia will implement bill that could upend the gig economy, assembly bill 5 known as ab five will be requiring employers and industries like ride hair and food delivery to contractors as employees. it could change the employment status of more than a million worker in california. right now less than two weeks from the implementation, there is more confusion than there is ity. >> no, i don't. i didn't know about the ab five hat's it consist of? >> all the drivers such as uber and lyft and door dash delivery drivers that current under ab five bill. >> not 100% certain but if that's the case i will probably sayye bye because i don't think they are giving me what i can make potentially as asa ry. >> the law is meant to empower

gig economy workers and give them protections they haven't had accessto. but at the same time it could hinder flexibility. i think the most important thing is people suld have the opportunity to decide if they want to be an employee. contract lawy doctors and r a engineers but not so for truck drivers and freelance journalists. uber lyft and door dash failing sure a carve-out for drivers are vowing to spend $90 on a ballotti iive to counter the effects of ab 5. meanwhile uber and lyft outed the bill as a risk factor in sec filings as analyst predict itd co cost them hundred of millions. uber and lyft say the drivers will remainhe contractors w the law goes into effect, likely leading to a flu of lawsuits. what happens here when ab 5 ffes not will have important implicatio for the gig economy in the rest of the country other states are considering similar legislation. in california could just the

beginning. "nightly business report," deedra bosa, san francisco. >>dw matthew l joins us to talk more about what this could mean for workers and t overall economy. he is a professor of economics pennsylvania's wharton school of business. matt, welcome, nice to have you >> hi, how are you? >> i'm agreed great, thank you medium term, short and medium-term. mpt, net whatt do you think it has on the overall economy? >> i mean, on the overall economy i would have thought tiny. although we see more gig workers than we used to. they're still a small fraction of the economy. and the t proportiot will be aircrafted which in small are. it's going to be very disruptive for small numbers of people. if you are aircrafteds in a big. de but overall economy it's not going to have a massive effect. >> for the san francisco economy which is sizable do we know the we don't.

as the report mentioned there is a sensehat the b companies that use the contractors potentiallyee major new costs. you know, assuming that they do reclassify them as employees, i understand thatber and lyft are sticking to their guns and saying the people are contractors. in the immediate terms it's ing to be more about lawsuits than it is about kindr e concrete consequences there is a potential forig costs. >> if you divided it up into winners and losers would you put employers strongly in the looser category? >> yes, i mean, some of the compies have created business models based on the idea they can treat the workers as independent contractors and potentially will be seeing big costs. some of the costs may come down as ty figure out how to organize work around treing people as employees. but i the short-term, yes they face costs that's why they fight it. >>ho are the winners, the individual employees depending onieow they themselves?

>> absolutely. i mean, i think ingo the rnment survey done a couple years ago about half of the peopleorking as contractors contingent workers said they wanted to be contingent workers and half would rather regular employment relationships niece peopl forced into this who would rather be reguloy ems. they are winners. the other people who are likely winnersre people whose employers might otherwise be thinking about could we cut costs by making these people contractors instead? i think the fact you don't have the competition from low wage contracting could be good for a large number of people as well fwloo matthew bidwell with the university of pennsylvania wharton school of business. thanks for joing us. >> thank you. strong results for blackberry. that's where with he begin the market focus. the proder of the security software and services beat analyst expectations thanks to strong sales in its patent

listening and cybersecurity businesses. the company also sawequential revenue growth across all software units. shares claimed more an 12% to $653. revenue gwth at winnebago stronger than expected thanks to rise in demand for motor homes pan towables. the company says it benefitted from acquisition of review firm nuwmar and topped estimates for seven qrters gaining 8% to $51.91. a mixed quarter for carmax, they reported better than expected revenue thanks to coarable dealer sales and rise in used car sales. but the company fell short due to higher expenses. the shares slid more than 6% to $92.71. and merck received roued entrepreur approval for the ebola vaccine marking the firci approved v for the virus. something merck called an important milestone.

the vaccineved by the european commission last month. the stockp 27% to $91.58. alleek we've been getting acady for the new year by bringing market monitor guests. font'sest has three names he says belong in yourtf pio. the last time he was on he recommended johnson & johnson up 48%. chevn, up 55% and intel is 114% higher. joining us once again a is randall ely, the chief investment officer of he had garr low max company. >> good to see you. >> you are findingeralue out even with the market at all-time highs. >> absoluly. when you have treasury -- and this is 10-year treasury interesttates less than 2% it makes stocks more attractive than would normally be the case. >> first pick is allstate. they have had a strong year. we've had a number of natural disasters but they've been very

>> that's right. face of i think many value players assume that a strong year in y price mea can't have a second strong year. but this is a cheap sck still. they've got lots of -- lots of cash,ow you strong financial position. and the fact is that they don't have to growve earnings the next year to be a good investment. >> how long would you typically hold some of the >> oh, we buy nothing unless we think we can hold at least three years. but ideally we like to hold ten years or long. >> okay. exxon next on the list, the energy sector has had tough sledding though. >> that's right. >> why do you likexo ex >> here you get the 5% dividend. so the management is talking with their action. buthe fact is energy prices are not going down forever. so you had oil prices down on oaverage. and earnings slid. people see it as a high pe stock because it's 20. yt the facts of life is a need is oil prices to bounce a

little and suddenly you bought it as a lower than normal pe. >> and pfizer facing concerns abt the loss of patent andel longtimeng drugs. certainly not the only drug stock facing that challenge. but y find other reasons to buy it,ne the pipe >> yes, this is a company that has -- they have a culture of dealing wh these challenges that drugs go off patent, and they have drugs in the pipeline. and they are also looking atth whats are doing. they also have, you know, very stronginancial position. they can withstand the ups and downs of the market. >> what abo the dividend? >> oh, what i like about them you got the low pe ratio, 14 and high y dividendld about 4%. >> very quickly on the market do you like the market overall. >> generally, i would be afraid of it because of valuation. price to book ratio, 3.5% almost twice normal. but the fact is it's the fourth year of the four-yearyc.

and that's usually good for stocks. also the fed is easy. that's good for stocks. i think it should a sane market but be prepared for something worse. >> volatility >> yes. >> because of the election year coming up or just the fact that we're a losty levels. >> the fact we're at the losty levels. i think the election year should be helpful. >> on that note, thank you so much randall. >> thank you. >> nice to have y. randy ely with the he had garr low max company. >> coming up the gaming mecca turns 20 but the next 20 could look a lot different. ♪ ♪

♪ the convenience store chain wawa hit with a large scale data brch potentiallyffecting all locations. malware was discovered on the company's payment processing servers earlier this month. now, the company says the card information was swiped, including credit and debit mb s, expiration dates and card holder names. it is unclear,we r, how many customers were actually affected. macau, a former porpgt z colony handed back to china 40 years ago. and since then it's become a major fce in the gaming economy. contessa brewer hmore. >> xi jinping is in the gaming anniversaryf the handover from portugal tohi c.

he praises the. culture. and he dangled the promise of fewer financial restrictions for the special administrative region. this week expanng the amount of money gamblers can take from ma coup to mainland china. but gaming analysts say it would have had more impact for money to freely flo the other way. there have been repts bjing exchange center in macau in an effort to diversify the economy beyond gaming. sources in the gaming indusy told me it seems particularly ambitious. they see it ashot across the bow to asia finance center hong kong. lawrence ho talked to cnbc age dwra about the possibility. >> as they integrate in the greater bay area there areanore morees opportuni if the stock exchange or all that comes to marialize, i think that's another avenue for

macau to diversify going forward. >> casino companies themselves are working to expand beyond ming with huge investments and cultural institutions dining and entertainment. when resort ceo matt maddox says we believe the investmente make in our transformative crystal paviliononexpansion in macau coupled with the government policies to accelerate growth in the bay area makes us optimistic about the futur of a diversified macau economy. the casinos are due for concession renewal in 2022. in the here and now the visit by xi jinping is expected to hit december revenues hard because of restrictions on visa and limit on overnight visits. sources tell me december is looking likell it aboff 145 to 17% for the full month and the valuable vip segment down more than 30 years year over year due tthe beijing policies cracking downn junk ets bringing the lucrative high rollers into macau. casinosxpithure to macau have a reason to celebrate 2019.

thayer stick prices exceeded the broader s&p. for "nightly business report," i'm contessa brewer. and before we go, lets take another look at the record day on wall street. the dow up 78 points, the nasdaq rose 37, the seventh consecutive record close and the s&p 500 added 15. all of the major averages were higher for the week. and that is "nightly business report" for tonight. i'm sue herera. thanks for joining us. have a great weekend, everybody. and we'll see you mond. ♪ ♪

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